KUALA LUMPUR (Jan 6): Shares of Petroliam Nasional Bhd (Petronas) – linked stocks declined in early trade on Tuesday as crude oil prices hovered around the US$50 per barrel mark.
Petronas Chemicals Group Bhd fell in early trade on Tuesday, in line with the decline of the broader market as well as other Petronas-linked stocks.
At 9.09am, P Chem lost 2.89% or 15 sen to RM5.04 with 38.600 shares done.
AffinHwang Capital Research had downgraded Petronas Chemicals Group Bhd (Pchem) to “Hold” at RM5.19 with a lower target price of RM5.30 (from RM5.60) and said that triggered by the sharp fall in oil prices, polymer prices declined by 18-24% in 2H14 and may soften in 2015, further weakening profit margins for Pchem’s gas-based products.
In a note Tuesday, the research house said it expects the net impact to be negative, although higher utilisation and a stronger US dollar should offset the margin squeeze.
“As we now see a higher risk of margin pressure in 2015, we downgrade Pchem to Hold,” it said.
Meanwhile, Petronas Gas Bhd lost 3.3% or 72 sen to RM21.10, and Petronas Dagangan Bhd was down 1.41% or 24 sen to RM16.80