According to an analysis by CLSA Securities, Thai Oil Public Company Limited (SET: TOP) reported a notable net profit of THB 2.5 billion (THB 1.10 EPS) for the fourth quarter of 2025, marking a 14% increase quarter-on-quarter, though still trailing last year’s result by 11%. This performance beat CLSA’s estimate and the consensus by 13% and 7%, respectively, buoyed by stronger refining margins and increased production rates.
Thai Oil’s Gross Refining Margin (GRM) surged to $9.4 per barrel, up sharply from $3.5 in the prior quarter, largely due to higher crack spreads for diesel, jet fuel, and gasoline. The refining run rate improved significantly to 114%, up from 82% in 3Q25 when a 30-day maintenance shutdown dampened throughput.
CLSA stated that despite posting a THB 3.5 billion stock loss compared to a THB 1.5 billion gain in the previous quarter, Thai Oil exhibited a strong operating performance. Aromatics operations improved on a quarter-on-quarter basis, with the product-to-feed margin rising to $51 per ton from $21 in 3Q25, contributing an additional $1.0 per barrel to the group’s gross integrated margin (GIM). The aromatics run rate rose to 76% from 39% in the previous period.
The lubricants business also saw improvements amid a higher run rate, adding $1.5 per barrel to the GIM. Consequently, TOP reported a market GIM of $11.8, up from $5.2 in 3Q25.
Other notable extra items included a THB 408 million gain from net realizable value (NRV), a THB 330 million foreign exchange loss, and a THB 1.1 billion hedging loss. For reference, TOP booked a profit of THB 2.1 billion in 3Q25, reflecting a 67% quarter-on-quarter decline at that time.
Looking ahead, while quarter-to-date crack spreads for jet fuel and diesel have softened slightly, CLSA estimates the GRM should maintain at around $8 per barrel. Crack spreads and oil prices are expected to remain robust in the first half of 2026, supported by low global diesel inventories and heightened geopolitical tension in the Middle East. This environment is also likely to reduce the risk of significant stock losses.
Thai Oil maintains a solid liquidity position after issuing a $600 million perpetual bond in the fourth quarter and confirms it does not plan further issuances this year. With $1.9 billion in cash on hand and $1.2 billion earmarked for capital expenditure toward the Clean Fuel Project (CFP) in 2026, the company appears well within its means to fund expansion.
CLSA also notes the potential for additional fundraising through a 15% divestment in Chandra Asri Petrochemical and prospective strategic investments from PTT.
Reflecting confidence in Thai Oil’s outlook, CLSA has raised its target price to THB 58.00 per share (from THB 36.00) and upgraded the rating from ‘Hold’ to ‘Outperform.’ The firm increased its 2026 and 2027 earnings estimates by 15% and 19%, respectively, following visible earnings momentum. Furthermore, Thai Oil has announced a final dividend of THB 1.0 per share, with the shares set to go ex-dividend on 25 February.
