Saudi petchem sector Q1 profit set to rise 60%, says Riyad Cap

The aggregate net income of Saudi Arabia’s petrochemical sector is expected to rise by 60 percent year-on-year (YoY) and 16 percent quarter-on-quarter (QoQ) in the first quarter of 2017, Riyad Capital said in an earnings forecast for petrochemical stocks under its coverage.

“Q1 2017 earnings are likely to be a mixed bag as prices of basic petrochemicals rose feebly, while few intermediates have gone up (ammonia and MEG). We believe with KSA producers being primarily ethane and propane feedstock users, the high prices (feedstock) correspondingly lead to spreads contraction,” the report said.

Saudi Basic Industries Corp.’s (SABIC) net profit is forecast to see a rise by 48 percent year-on-year to around SAR 5 billion.

Saudi Industrial Investment Group (SIIG) is expected to see a 66 percent YoY increase in net profit in Q1 to SAR 146 million, while National Petrochemical Co.’s (Petrochem) net profit is likely to jump 40 percent YoY to SAR 171 million.

Sahara Petrochemicals Co.’s net profit for Q1 is forecast see net profit rise of 30 percent to SAR 71 million, while Rabigh Refining and Petrochemical Co. (Petro Rabigh) is likely to see a net profit of SAR 84 million compared to a loss of SAR 33 million a year earlier.