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Al Rajhi Capital raises Advanced Petrochemical’s TP to SAR 59/shr

Al Rajhi Capital raises Advanced Petrochemical’s TP to SAR 59/shr
Sales volume declined 3% year-on-year in Q2-19
ADVANCED
2330
0.27% 37.40 0.10

Riyadh – Mubasher: Al Rajhi Capital has raised Advanced Petrochemical Company’s (APCC) target price (TP) to SAR 59 per share instead of SAR 58.90 a share.

“APCC reported Q2 earnings at SAR192mn, broadly in-line with our estimate of SAR184mn and higher than the consensus estimate of ~SAR174mn,” the Saudi financial services provider said in a report on Wednesday.

Moreover, Advanced Petrochemical’s sales volume declined 3% year-on-year in Q2-19, leading to a slight miss in top-line, Al Rajhi Capital noted, assigning “Neutral” rating on the company’s stock.  

“The company continued to demonstrate strong operating performance, with fixed production costs  (other than feedstock costs) declining 30% q-o-q, helping the company to expand gross margin by over 6pps sequentially in Q2,” the statement highlighted.

 Equity income declined sharply in Q2, below Al Rajhi Capital’s expectation amid lower product spreads.