Riyadh - Mubasher: Al-Rajhi Capital increased their target price (TP) for Yansab and SAFCO up to SAR 58 and 62 per share, respectively, and reiterated their ratings and target prices for most Saudi petrochemicals companies.

According to a recent report by Al-Rajhi Capital, oil prices declined in January by 3.3% compared to December on renewed concerns on higher US supply, recording its first monthly drop since October last year.

The research firm also noted in its Saudi petrochem sector monthly report, the increase in feedstock costs, as Naphtha prices rose 3.3%, and is currently trading at its highest level since July 2015.

“As for NGLs, Saudi Aramco has increased propane and butane prices for February to their highest levels in more than two years,” the report indicated.

Ethylene and HDPE remained almost unchanged while other polymer products such as LDPE went up by 2.7%, while polypropylene increased by 2.4%, according to the report.

“Overall as feedstock costs increased more than the increase across most product prices, spreads contracted as we had expected and discussed in our previous report,” it added.