SIIG likely to post higher profit in 2018, says Falcom

12/06/2018 Argaam

 

Saudi Industrial Investment Group’s (SIIG) net profit is forecast to be driven this year by restart of operations at Saudi Chevron Phillips (SCP) and Jubail Chevron Phillips (JCP), after completion of periodical maintenance in Q1 2018, Falcom Financial Services said in a recent report.

 

Revenue is expected to rise at a compound annual growth rate (CAGR) of 3.5 percent between 2017 and 2021.

 

The company’s petrochemical segment is likely to benefit from a potential 25 percent rise in demand for polypropylene in 2022, compared to the current levels.

 

In addition, higher global oil prices and utilization rates along with pent-up demand for China’s petrochemical products are key positive trends for SIIG.

 

Meanwhile, a strong balance sheet and a high yield from free cash flows makes SIIG’s stock a solid investment bet, the brokerage firm added.

 

Falcom recommended an “overweight” rating on SIIG, setting the stock’s target price at SAR 30.60.

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