MEED 100 Sector analysis: Petrochemicals

31 March 2010

Saudi firms once again dominate the rankings for regional petrochemicals companies

Petrochemicals giant Saudi Basic Industries (Sabic) retains its position in the MEED 100 as the region’s largest listed company.

After its market capitalisation fell by almost two thirds in 2009 to $39.1bn from $111bn, the company’s capitalisation has rebounded to $70.8bn in this year’s ranking. This is despite the company posting its first quarterly loss since 2001 for the four months to April 2009.

Petrochemicals
Rank 2010Rank 2009CompanyExchangeMarket Cap ($m)Share price ($)
11Saudi Basic Industries CorporationTadawul70,79923.60
1620Saudi Arabian Fertiliser Company Tadawul9,40037.60
2324Rabigh Refining & Petrochemical Company (PetroRabigh) Tadawul7,7098.80
2527Saudi Kayan Petrochemical CompanyTadawul7,2404.83
3350Yanbu National Petrochemicals CompanyTadawul5,64010.03
5485National Industrialization Company (Tasnee) Tadawul3,5507.71
9195Abu Qir Fertilizers and Chemical IndustEgypt2,07140.92
9496Saudi International Petrochemical Company (Sipchem) Tadawul2,0186.05
100naNational Petrochemical Company Tadawul1,9204.00
Source: Thomson Reuters

The firm returned to profitability later in the year. However, net income for the full year in 2009, totalling SR9.1bn ($2.5bn), was some 59 per cent lower than for 2008.

Sabic’s roller-coaster ride was mirrored by other petrochemicals producers in the MEED 100. Dramatic falls in profitability in the first quarter were followed by a gradual return to growth in the rest of the year. Their market capitalisation and positions have risen as a result of improving sentiment.

Saudi Arabia continues to dominate the regional petrochemicals sector in the rankings, with eight out of the nine petrochemicals listed in the MEED 100 located in the kingdom.

Saudi Kayan Petrochemicals Company and Yanbu National Petrochemicals Company have yet to begin commercial production, but are scheduled to do so in 2010. This should see them climbing even higher in next year’s list.

Sabic’s roller-coaster ride was mirrored by other petrochemicals producers in the MEED 100 list this year

Following its initial public offering in August 2009, National Petrochemical Company (Petrochem) is a new entrant to the MEED 100. The company holds a 65 per cent stake in the local Saudi Polymers Company with the US’ Chevron Phillips holding the remaining 35 per cent. The joint venture partners hope to start production at their Jubail petrochemicals complex in 2011. Petrochem ranks at 100, with a market capitalisation of $1.9bn.

PetroRabigh, a $10bn joint venture of state energy giant Saudi Aramco and Japan’s Sumitomo Chemical, was officially inaugurated in Saudi Arabia in November 2009.

The company ranks at 23 in this year’s list with a market capitalisation of $7.7bn.

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