Petkim: A crude awakening (downgraded to HOLD)
In this report, we downgrade Petkim from Buy to HOLD, with a new price target (PT) of TRY 5.80, offering 11% upside, on rising oil prices, Turkish economic woes and major sector investments. Crude oil is at its highest level in four years, ethylene prices have fallen by 3% and 5.6m mta of new ethylene capacity should be onstream by the year-end. Internally, however, the company should benefit from cheaper raw materials and lower logistic costs due to the STAR refinery. Petkim has been increasing its default capacity utilisation rates and has launched a number of initiatives to cut costs, increase reliability and improve product yields. The company paid out 39% of its 2017 earnings in 2018, and management has indicated a desire to pay regular dividends.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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