Core Viewpoint - The Australian IPO market is currently facing challenges, with a lack of new listings and a recent withdrawal of Barkly Rare Earths from its planned IPO, indicating a continued struggle for new company listings despite some optimism in the metals market [1][2][5]. Group 1: IPO Market Status - Unity Metals recently listed on the ASX, marking the first IPO of the calendar year 2026 [1]. - Barkly Rare Earths has postponed its listing from January 22 to an indefinite status, contributing to a bleak outlook for new IPOs [1][5]. - The easing of ASX IPO listing rules last year has not significantly improved the situation, as the market still resembles the IPO drought experienced in late CY23 [2][3]. Group 2: Upcoming Listings - Two upcoming IPOs are scheduled for February: Eastern Gas Corporation aiming to raise $5.5 million and Macallum New Energy targeting $9 million, both categorized as smaller listings [6]. - There is a notable absence of larger, high-profile companies looking to list, with Canva confirming it will not pursue an ASX IPO, leaving investors awaiting a significant listing [6]. Group 3: Market Sentiment - Despite the recent enthusiasm in metals prices, the overall sentiment in the IPO market remains cautious, with stockbrokers returning from holidays in anticipation of new listings [2][4]. - The current environment suggests that investors who favor IPOs may find limited opportunities in the near term [5].

Group 1 - Petrobras and IG4 plan to implement alternate control over Brazilian chemical producer Braskem [1] - This strategic move indicates a shift in ownership dynamics within the Brazilian chemical industry [1] - The collaboration aims to enhance operational efficiency and market positioning for Braskem [1] Group 2 - The involvement of Petrobras, a state-controlled oil giant, highlights the significance of energy companies in the chemical sector [1] - IG4's participation suggests a growing interest from private equity in the Brazilian chemical market [1] - This development may lead to increased investment and innovation within Braskem, impacting the broader chemical industry landscape in Brazil [1]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investing can be risky as stocks may lose momentum if future growth does not justify high valuations [1] - A safer approach is to invest in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [2] Group 2: Braskem (BAK) Stock Analysis - Braskem (BAK) has shown a four-week price change of 1.4%, indicating growing investor interest [3] - Over the past 12 weeks, BAK's stock gained 18.6%, with a beta of 1.89, suggesting it moves significantly more than the market [4] - BAK has a Momentum Score of A, indicating a favorable time to invest [5] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investors [6] - BAK is trading at a low Price-to-Sales ratio of 0.09, meaning investors pay only 9 cents for each dollar of sales, indicating a reasonable valuation [6] Group 3: Additional Investment Opportunities - Besides BAK, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, suggesting further investment opportunities [7] - Zacks offers over 45 Premium Screens tailored to different investing styles, aiding in stock selection [8]

Core Viewpoint - BofA has lowered the price target for Braskem (BAK) to $3.30 from $3.70, maintaining a Neutral rating due to recent legislative changes in Brazil that negatively impact the company's expected benefits [1] Group 1: Price Target Adjustment - BofA reduced the price target for Braskem from $3.70 to $3.30 [1] - The firm maintains a Neutral rating on Braskem shares following the price target adjustment [1] Group 2: Legislative Impact - Brazilian President sanctioned Draft Bill (PL) 892/2025, which establishes the PRESIQ benefit and the REIQ's rate schedule [1] - The proposed increase in REIQ for 2026 was vetoed, which was previously incorporated into the firm's expectations [1] - The analyst views the news as negative for Braskem, as it alters anticipated benefits for the company [1]

Core Insights - Petrobras and Braskem have signed long-term feedstock supply contracts valued at $17.8 billion, marking a significant milestone in the Brazilian petrochemical industry [1][2][18] Group 1: Overview of the Agreements - The agreements consist of two major contracts: one for petrochemical naphtha worth $11.3 billion and another for natural gas liquids (NGLs) worth $5.6 billion, set to commence in January 2026 [3][4] - The naphtha supply deal will provide 4.116 million tons in 2026, increasing to 4.316 million tons by 2030, ensuring a stable supply for Braskem's operations [5][6] Group 2: Strategic Shift and Expansion - Braskem is transitioning from naphtha to more competitive NGLs like ethane, aiming to enhance Brazil's position in global petrochemical production [2][11] - The $5.6 billion contract for ethane, propane, and hydrogen is crucial for expanding Braskem's Duque de Caxias facilities, expected to run for 11 years starting in 2026 [6][7] Group 3: Long-term Supply Commitments - From 2026 to 2028, Petrobras will supply 580,000 tons of ethylene equivalent annually, increasing to 725,000 tons per year starting in 2029, supporting Braskem's expansion plans [10][11] - Additional propylene supply agreements valued at approximately $940 million will further support Braskem's diverse production lines, ensuring access to necessary feedstocks [14][15] Group 4: Strategic Influence and Future Outlook - Petrobras is increasing its influence over Braskem as Novonor plans to divest its stake, indicating a trend of state-controlled entities shaping Brazil's petrochemical sector [12][13] - The collaboration between Petrobras and Braskem is expected to unlock nearly $800 million in investments, driving growth and modernization in the Brazilian petrochemical industry [7][18]

Core Insights - Brazilian petrochemical producer Braskem announced that conglomerate Novonor has agreed to sell its controlling stake in the company to private equity firm IG4 Capital [1] Company Summary - Braskem is a leading player in the petrochemical industry in Brazil [1] - The sale of Novonor's controlling stake indicates a significant shift in ownership and potential strategic direction for Braskem [1] Industry Context - The transaction highlights ongoing consolidation trends within the petrochemical sector, as private equity firms seek to invest in established companies with growth potential [1]

Core Viewpoint - Norsk e-Fuel AS and Braskem have formed a strategic collaboration to explore the integration of e-Naphtha into the plastics value chain, aiming to enhance the development of carbon-derived plastics and promote a circular economy [1] Group 1: Companies Involved - Norsk e-Fuel AS is recognized as a pioneer in Power-to-Liquid (PtL) technology [1] - Braskem is identified as a global leader in polymers and biopolymers [1] Group 2: Objectives of the Collaboration - The partnership seeks to accelerate the development of plastics that utilize carbon emissions that would otherwise be released into the atmosphere [1] - Both companies are committed to reinforcing a circular future through this collaboration [1]

Financial Performance - In Q3 2025, Braskem recorded a consolidated recurring EBITDA of US$150 million, a 104% increase compared to Q2 2025[28]. - The net revenue for Q3 2025 was US$3,175 million, reflecting a 1% increase from Q2 2025 but a 17% decrease year-over-year[22]. - The gross profit for 3Q25 was R$615 million, reflecting a 14% decrease compared to 2Q25 and a 61% decrease compared to 3Q24[65]. - Recurring EBITDA for 3Q25 was R$1.1 billion, an increase of 29% compared to 2Q25, but a decrease of 40% compared to 3Q24[83]. - The net financial result for Q3 2025 was a loss of R$904 million, a significant improvement compared to a loss of R$2,332 million in Q3 2024[182]. - The company recorded a net loss of R$174 million in Q3 2025, a 55% improvement from a loss of R$390 million in Q2 2025[168]. - The company recorded a net loss attributable to shareholders of US$1 million (R$26 million) in 3Q25, primarily due to geological event provisions and the hibernation of the chlor-alkali plant[195]. Sales and Market Performance - Sales volume of main chemicals in Brazil increased by 11% in the domestic market and 10% in exports[25]. - The sales volume of resins in Brazil decreased by 5%, while exports remained stable[25]. - The Brazil/South America segment recorded a 35% increase in Recurrent EBITDA compared to 2Q25, despite a 39% decrease compared to the same quarter last year[37]. - Resin sales in the Brazilian market decreased by 5% compared to 2Q25, primarily due to higher import volumes[43]. - Exports of resins increased by 1% compared to 2Q25 and by 9% compared to 3Q24, driven by higher product availability[46]. - The sales volume of main chemicals in the Brazilian market increased by 11% compared to 2Q25, driven by higher demand for paraxylene, ethylene, and propylene[50]. Utilization Rates - The average utilization rate for ethylene in Brazil was 65%, down 9 percentage points from Q2 2025[22]. - The utilization rate in the United States and Europe was 79%, with a negative recurring EBITDA of US$15 million[26]. - In Mexico, the utilization rate was 47%, significantly impacted by a general maintenance shutdown[27]. - The average utilization rate of petrochemical complexes fell by 9 percentage points compared to 2Q25, attributed to scheduled maintenance shutdowns[41]. - The Green Ethylene utilization rate in 3Q25 was 40%, down 31 percentage points from 2Q25 and 55 percentage points from 3Q24[84]. - The average utilization rate of PE plants in Mexico increased by 3 percentage points compared to 2Q25, reaching 47%[129]. - The utilization rate of PP plants increased by 5 percentage points compared to 2Q25, reaching 79%[98]. Debt and Financial Structure - The corporate gross debt at the end of Q3 2025 was approximately US$8.4 billion, with an average maturity of 9 years[29]. - As of September 30, 2025, gross debt stood at US$2.179 billion, with net debt increasing by 9% year-over-year to US$2.133 billion[160]. - The average debt maturity was approximately 5.2 years, with a weighted average cost of debt at exchange variation +7.3% per annum[157]. - Fitch and S&P downgraded Braskem Idesa's ratings to 'CCC+' and 'CCC', respectively, due to concerns over its capital structure[163]. - The company announced it is evaluating a range of economic-financial options to improve its capital structure amid macroeconomic uncertainties[126]. Investments and Projects - The Company approved the Transforma Rio Project with an estimated investment of R$ 4.2 billion to expand ethylene and polyethylene capacity in Rio de Janeiro[31]. - Total investments planned for 2025 amount to US$104 million, including US$23 million for the completion of the ethane import terminal[149]. - The ethane import terminal has a capacity to import up to 80,000 barrels of ethane per day, covering 120% of Braskem Idesa's needs[153]. - Total investments expected for 2025 are US$404 million (R$2.4 billion), with approximately US$133 million (R$725 million) invested in 3Q25[197]. - The total investment in Brazil for 9M25 was R$1.478 billion (US$270 million), with a projected total of R$2.174 billion (US$363 million) for 2025[199]. - Braskem advanced in capacity expansion projects through resources from REIQ Investimentos, with an updated investment estimate of R$405 million (US$72 million) for 2025[200]. Cost and Expenses - COGS in 3Q25 was impacted by R$435 million due to the hibernation of the chlor-alkali plant in Alagoas[72]. - SG&A expenses increased by 40% in reais compared to 3Q24, primarily due to higher provisions for losses in accounts receivable[80]. - SG&A expenses increased by 8% in dollars compared to 2Q25, mainly due to higher spending on personnel and IT[119]. - COGS decreased by 7% in dollars compared to 2Q25, primarily due to a 5% reduction in international propylene price references in the U.S.[115]. Geological Events and Provisions - The Company faced a geological event provision of approximately R$ 524 million, impacting its financials[40]. - The provision balance for the geological event in Alagoas at the end of 3Q25 was R$3.8 billion, a decrease of 19% compared to the end of 2Q25[61]. - The Company entered into a State Agreement with the State of Alagoas on November 10, 2025, involving a total payment of R$1.2 billion, with R$139 million already paid[61]. - The company recorded a provision of R$524 million related to the geological event in Alagoas, impacting other operating expenses[81].

Core Insights - Brazilian engineering group Novonor is nearing an agreement to sell a significant portion of its controlling stake in the petrochemical company Braskem to IG4 Capital [1] Group 1 - The transaction involves the sale of most of Novonor's controlling interest in Braskem, indicating a strategic shift for the company [1] - Sources indicate that the deal is in advanced stages, highlighting the urgency and importance of this transaction for both parties involved [1] - The potential sale reflects ongoing consolidation trends within the petrochemical industry, as companies seek to optimize their portfolios and focus on core operations [1]

Financial Data and Key Metrics Changes - In Q3 2025, Braskem recorded consolidated recurring EBITDA of $150 million, which is 104% higher than in Q2 2025 [5][13] - The company's cash position at the end of the quarter was approximately $1.3 billion, sufficient to cover debt maturities over the next 27 months [6][18] - Corporate leverage stood at approximately 14.7 times at the end of Q3 2025, mainly due to lower EBITDA over the last 12 months [18] Business Line Data and Key Metrics Changes - In Brazil, recurring EBITDA was $205 million, a 35% increase from the previous quarter, driven by prioritization of higher value-added sales [7][8] - The utilization rate of the Green Ethylene Plant was 40%, down 31 percentage points from the previous quarter due to lower demand from Asian markets [8] - The Mexico segment had a recurring EBITDA of negative $37 million, impacted by higher idle expenses and lower provisions for fine receivable [11] Market Data and Key Metrics Changes - Utilization rates at petrochemical plants in Brazil were lower due to maintenance stoppages and production optimization strategies [4][6] - Resin sales in the Brazilian market decreased due to higher polyethylene imports and lower polypropylene demand [7] - The global macroeconomic scenario was marked by moderate growth, accelerated inflation, and high interest rates, impacting industrial activity in resin processing [6] Company Strategy and Development Direction - Braskem's resilience program aims to implement tactical initiatives to generate sustainable value, focusing on maximizing EBITDA and mitigating cash consumption [19][20] - The company is pursuing a transformation program structured around optimizing naphtha base, increasing gas base flexibility, and migrating to renewable products [19][24] - The Transform Rio project was approved to expand the Rio de Janeiro plant's capacity, expected to add 220,000 tons per year of ethylene capacity [25][27] Management's Comments on Operating Environment and Future Outlook - Management highlighted that the petrochemical industry is facing a prolonged downturn, with expectations of a challenging environment until at least 2030 [32][38] - The company anticipates a significant gap between supply and demand in the petrochemical industry, driven by expansions in China and the Middle East [38] - Despite negative outlooks, Braskem continues to advance its resilience project to enhance global competitiveness [39] Other Important Information - Braskem signed an agreement related to the Alagoas geological event, providing for a total payment of BRL 1.2 billion, with around BRL 139 million already paid [15][53] - The company has established 79 action plans globally, with potential for capturing around $400 million in EBITDA and $500 million in cash generation for 2025 [20][22] Q&A Session Summary Question: When will a decision on the restructuring be made? - The company is currently completing a diagnostic with external advisors, and no options are confirmed or discarded at this moment [44] Question: What was the main economic driver for weak resin volumes this quarter? - The demand for resins is strongly associated with Brazilian GDP, and a drop of about 4% is expected for the next months, with a recovery of about 3% for the following year [45] Question: What is the timeline and expected impact of the Transform Rio project? - The project will begin its engineering phase now and is expected to be completed by the end of 2028, potentially adding just under $200 million per year to EBITDA [47][48] Question: What is the status of the PRESIC bill? - The bill has been approved by the Chamber of Deputies and is awaiting urgent evaluation in the Senate, with hopes for approval by the end of 2025 [51] Question: Can you provide details about the Alagoas agreement? - The agreement involves a total payment of BRL 1.2 billion over a 10-year period, with initial installments respecting the company's projected financial condition [53]