Indorama Ventures
Play
Cottoning to India's export ban Outperform - maintained Share price: Bt 40.25 Target price: Bt 50.00
Indorama Ventures Plc (IVL)
The recent ban on cotton exports by India’s government should trigger a price reversal for cotton, providing upsides to polyester and PTA margins and demand. Additional earnings growth would come from IVL’s continued acquisitions. We expect higher cotton prices to result in improved earnings in 2012. IVL’s superior returns and growth should lead to a share price rerating. Our Outperform call and target price, based on 8x CY13 EV/EBITDA, remain unchanged.
