Company Coverage
Siam Cement (SCC TB): 2Q26 Profit Beat Driven By Chemicals And Packaging
BUY (Maintained)
Current price:
Target price:
Upside:
Bt259.00
Bt320.00
+32.78%
Analyst
Highlights
- SCC reported a strong 2Q26 net profit recovery, significantly up qoq, driven by improved earnings contributions from SCGC and SCGP.
- Its financial position strengthened after using proceeds from the partial divestment of its CAP stake to repay debt, bringing both net debt-to-equity and net debt-to-EBITDA ratios back to healthy levels.
- Maintain BUY. Target price: Bt320.00.
Analysis
- Chemicals and packaging drove a strong 2Q26 earnings recovery. Siam Cement (SCC) reported a 2Q26 net profit of Bt11.54b, up 85% qoq, beating our forecast by 19% and market consensus by 41%. The earnings beat was mainly driven by stronger-than-expected contributions from the cement building material (CBM) and packaging businesses, as well as higher-than-expected stock gains. Excluding inventory gains, core profit came in at Bt10.83b, improving significantly qoq and yoy, with 1H26 core earnings accounting for 80% of our full-year forecast.
- SCGC: Stronger spreads offset lower sales volumes. SCG Chemical (SCGC) reported a 2Q26 net profit of Bt4.82b, up 347% qoq, supported by improved HDPE, PP, and PVC spreads, which more than offset lower sales volumes. Olefins sales volume declined 28% qoq to 489,000 tonnes following the closure of the ROC plant on 10 March and the LSP plant in mid-May. SCGC recorded stock gains of Bt1.08b in 2Q26 (vs Bt4.17b in 1Q26).
Highlights
- SCC reported a strong 2Q26 net profit recovery, significantly up qoq, driven by improved earnings contributions from SCGC and SCGP.
- Its financial position strengthened after using proceeds from the partial divestment of its CAP stake to repay debt, bringing both net debt-to-equity and net debt-to-EBITDA ratios back to healthy levels.
- Maintain BUY. Target price: Bt320.00.
Analysis
- Chemicals and packaging drove a strong 2Q26 earnings recovery. Siam Cement (SCC) reported a 2Q26 net profit of Bt11.54b, up 85% qoq, beating our forecast by 19% and market consensus by 41%. The earnings beat was mainly driven by stronger-than-expected contributions from the cement building material (CBM) and packaging businesses, as well as higher-than-expected stock gains. Excluding inventory gains, core profit came in at Bt10.83b, improving significantly qoq and yoy, with 1H26 core earnings accounting for 80% of our full-year forecast.
- SCGC: Stronger spreads offset lower sales volumes. SCG Chemical (SCGC) reported a 2Q26 net profit of Bt4.82b, up 347% qoq, supported by improved HDPE, PP, and PVC spreads, which more than offset lower sales volumes. Olefins sales volume declined 28% qoq to 489,000 tonnes following the closure of the ROC plant on 10 March and the LSP plant in mid-May. SCGC recorded stock gains of Bt1.08b in 2Q26 (vs Bt4.17b in 1Q26).
BUY (Maintained)
Current price:
Target price:
Upside:
Bt259.00
Bt320.00
+32.78%
Analyst
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at the following link: https://research-api.uobkayhian.com/assets/disclaimer/df64a6ea-7980-447c-ae9e-fd19b93257dc, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
