Abu Dhabi National Oil Co. (Adnoc) is in talks to take equity stakes in refining units linked to Thailand’s PTT Public Company Limited (SET: PTT), as the Emirati energy giant pushes to secure long-term crude off-take deals and expand its global fuel trading footprint, according to a Bloomberg report.
The state-backed oil major could finalize an agreement before the end of the year, with PTT Global Chemical (PTTGC), Thai Oil (TOP), and IRPC among the units under discussion as part of PTT’s broader search for international strategic partners.
Kiatnakin Phatra Securities (KKPS) believes Adnoc is looking to expand its fuel trading business and secure long-term buyers for its own crude by taking equity stakes in overseas refineries — a deal that could be announced before the end of this year.
In a research note, KKPS said Adnoc is part of a shortlist of national oil companies (NOCs) — including Saudi Aramco, Kuwait Oil, Sinopec, and Qatar Energy — that have been actively expanding downstream and trading footprints outside their home markets. Adnoc in particular has been aggressive over the past five years in building out its chemical and energy businesses beyond the Middle East.
Among PTT’s listed refining and petrochemical units — PTTGC, TOP, and IRPC — KKPS thinks Adnoc is most likely to be interested in taking a stake in TOP.
The brokerage’s reasoning centers on TOP’s Clean Fuel Project (CFP), which will increase the refinery’s output of diesel, naphtha, and other refined products — precisely the kind of barrels Adnoc would want to feed into its expanding global trading operation. KKPS also noted that a large share of TOP’s crude supply already comes from Adnoc, and taking an equity stake could be a way for Adnoc to lock in that relationship and protect TOP from switching to other crude suppliers over time.
Based on a hypothetical 10% stake sale across the three PTT units, KKPS estimated the following:
At a base-case valuation of 1.00x book value, a 10% stake sale would imply proceeds of roughly Bt30.8bn for PTTGC, Bt20.3bn for TOP, and Bt7.6bn for IRPC — a combined Bt58.7bn (about US$1.78bn) across all three. The implied estimated prices sit well above current closing prices, translating into premiums of 49% for PTTGC, 36% for TOP, and 24% for IRPC.
KKPS flagged a recent precedent that could argue for an even higher valuation multiple than the 1.00x BV base case used above: Saudi Aramco paid US$3.4bn for a 10% stake in China’s Rongsheng Chemical/refinery complex, a deal that implied a valuation of more than 1.5x price-to-book (P/B).
That comparison is notable given where Thai refiners currently sit relative to their own trading history. KKPS’ charts show TOP’s price-to-book value (PBV) currently trading near the low end of its historical range — around its -1 standard deviation level of 0.6x, versus a long-term average of about 1.0x and a +1 standard deviation level of 1.4x. Meanwhile, regional refiner SPRC, by comparison, is trading closer to its historical average of 1.2x.
Taken together, KKPS’ analysis suggests that if a strategic buyer such as Adnoc were willing to pay a premium multiple — in line with Aramco’s Rongsheng precedent — rather than the 1.00x BV base case, the implied deal value and share-price premium for TOP could end up higher than the base-case estimates above.
