Reuters: Hot Stocks: STOCKS NEWS THAILAND-CIMB upgrades PTT Global Chemical, raises target

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STOCKS NEWS THAILAND-CIMB upgrades PTT Global Chemical, raises target Jul 31st 2012, 02:29 Mon Jul 30, 2012 10:29pm EDT CIMB Research upgraded PTT Global Chemical Pcl to 'outperform' from 'neutral' and raised its target price after the petrochemicals maker announced a new pricing formula for its gas purchase from parent PTT Pcl. "The sooner-than-expected announcement of the gas feedstock pricing revision and the only slightly larger impact would remove the share price overhang," broker CIMB said while raising its price target for the stock to 77 baht from 65 baht. PTT Global Chemical shares closed up 2.6 percent at 58.75 baht on Monday. The stock had fallen 3.7 percent so far this year, underperforming a 16.4 percent gain of the broader market . "We believe the change will significantly reduce the margin risk for PTTGC for many years, given that the new formula reflects an oil price assumption range of between $70/bbl and $130/bbl, and a HDPE-naphtha spread range of $450-600/tonne, sufficiently capturing future price volatility," CIMB said in a report. PTT Global Chemical said on Monday the new pricing formula would increase its petrochemical feedstock costs by 8 percent. 0911 (0211 GMT) ($1 = 31.58 baht) (Reporting by Viparat Jantraprap in Bangkok; viparat.jantraprapaweth@thomsonreuters.com) Link this Share this Digg this Email Reprints

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