[Click eStock] "OCI Anticipated to Recover Across All Divisions... Target Price Set at 130,000 Won"

On March 31, Samsung Securities analyzed that OCI is entering a phase of valuation re-rating, driven by expectations for a recovery in performance across all of its business divisions, including Basic Chemicals and Carbon Chemicals. Accordingly, the firm maintained its BUY investment opinion and set the target price at 130,000 won.

Hyunryul Cho, a researcher at Samsung Securities, stated, "OCI's valuation, based on a 12-month forward P/B, peaked at 1.2 times in 2023 and declined to an average of 0.45 times in 2025," adding, "This is due to deteriorating profitability, as the ROE fell to as low as -5.4% during the same period."

However, profitability is expected to recover in earnest along with future performance improvements. Cho predicted, "Thanks to simultaneous recovery in performance across all business divisions, including Basic Chemicals and Carbon Chemicals, OCI's ROE is expected to recover swiftly to 7.2% in 2026 and further improve to 8–9% in 2027–2028. As a result, additional re-rating is possible compared to the current P/B of 0.68 times."

In the Basic Chemicals division, the recovery of the semiconductor industry is identified as a key variable. The profitability of related materials is expected to improve rapidly, driven by the rebound in the memory semiconductor market. Cho explained, "We expect a notable recovery in the profitability of materials for semiconductors, thanks to the rebound in the memory semiconductor industry. The benefits of this recovery will be reflected sequentially in phosphoric acid, hydrogen peroxide, and polysilicon."

In particular, the high proportion of semiconductor customers is expected to have a positive impact. He emphasized, "With sales to semiconductor customers accounting for more than 62% of the Basic Chemicals business, a clear recovery in profitability is anticipated." Additionally, for high-value-added products such as phosphate-based etchants, customer quality certification is in its final stage, and commercialization could serve as an additional catalyst for upward valuation revision.

The Carbon Chemicals division is also reflecting expectations for a market recovery. This business is operated based on coal-derived raw materials, with some products competing with those made from petroleum-based raw materials. Cho stated, "Among carbon chemical sales using coal-based raw materials, 45% compete with petroleum-based raw materials. The recent surge in oil prices, leading to higher product prices, is expected to provide an indirect benefit to OCI's Carbon Chemicals business, which uses coal-based raw materials."

This content was produced with the assistance of AI translation services.