Indorama Ventures Public Company Limited (SET: IVL), a leading global producer of polyethylene terephthalate (PET), stands to benefit after the United States government announced a sharp increase in tariffs on imports of the widely used plastic, according to an analysis from Kasikorn Securities.
A new proclamation from the White House dated September 5 has placed PET on the list of products subject to ‘reciprocal tariffs’. Effective immediately, the average duty rate on imported PET has jumped dramatically, from 6.5% to as high as 27-28%. The move is part of a broader review and tightening of US trade enforcement policy.
Kasikorn Securities views this development as a positive catalyst for IVL. The steeper US tariffs are expected to reduce the competitiveness of imported PET, which accounts for roughly one-fifth of America’s demand, or about 1 million tonnes annually, mainly sourced from Vietnam, South Korea, Taiwan, and Thailand.
With foreign supply likely throttled by the tariff hike, IVL—one of the largest domestic producers—could see improved operating rates at its US-based PET, PTA, MEG, and PX plants. Analysts estimate the company’s production volumes in these lines could grow by 10-20%, or about 100,000 to 200,000 tonnes per year, with a prospective lift in annual EBITDA of $25-50 million. That translates into a net profit boost of roughly 700 million to 1.4 billion baht.
Despite the tactical advantage, Kasikorn Securities maintains a ‘Hold’ rating on IVL, with a target price of THB 22.60. The upside impact from the tariff change is limited—with a target price uplift of barely 1%, or THB 0.11-0.23 per share—though the development is likely to provide a near-term boost to market sentiment for the stock.
