Positive View On Buying Allnex; Panic Selling By PTTGC Provides A Buying

We are positive on PTTGC acquiring Allnex. No cash call is required. After the M&A, it will raise PTTGC’s overall EBITDA margin (Allnex’s EBITDA margin = 17% vs 15% for PTTGC) and our 2021F core profit is expected to rise by 13% with the acceptable net D/E of 0.6x after the M&A. PTTGC pays at 9.8x EV/EBITDA in 2021F vs. that of 10.3x paid by Covestro (Allnex’s key competitor) on its RFM deal. The panic selling by PTTGC should provide a buying opportunity. Maintain BUY. Target price: Bt76.00.