Daol Securities has highlighted the significant positive impact of the recent US tariff hikes on imported PET and recycled PET (rPET) for Indorama Ventures Public Company Limited (SET: IVL). As of September 8, 2025, the US imposed new reciprocal tariffs ranging from 15% to 50%, with Asian Pacific countries facing about 20% and India up to 50%. These measures were implemented to support domestic industries by making foreign PET less competitive amid a surge in overseas supplies over the last three years.
IVL, a major US-based PET producer with 1.1 million tonnes per annum (mtpa) capacity out of the country’s 3 mtpa domestic capacity, stands to gain considerably. The tariffs will:
- Reduce the competitiveness of imported PET resin and flakes.
- Disrupt major trade flows from Southeast and South Asia, where there were prior exemptions.
- Introduce market uncertainty, leading some suppliers to pause shipments pending further clarity.
- Allow for potential PET price increases of up to USD60 per tonne.
For IVL specifically, higher margins on 2026 PET contracts and increased utilization of plants—particularly following the anticipated start-up of the long-delayed Corpus Christi PET-PTA plant—are cited as key benefits. This plant, jointly owned by IVL, Alpex, and Far Eastern New Century, currently incurs annual maintenance costs but may soon become operational.
Looking forward to 2026 and beyond, Daol Securities estimates IVL could secure an additional EBITDA of USD200 million–USD500 million from three main areas:
- Improved PET margins and utilization in the US due to tariffs (USD50 million–USD80 million).
- Higher specialty PET sales and margins via imports from Mexico (USD10–USD30 per tonne).
- Continued earnings growth from India and Africa, bolstered by IVL’s large market share and recent acquisition of a 24.9% stake in flexible packaging firm EPL in India.
Daol Securities maintains its BUY recommendation on IVL with a target price of THB28 per share. The brokerage sees IVL as the “best play” on US tariff protection, and growth opportunities in India and Africa. Incremental EBITDA for IVL in 2026–27 could climb by USD420 million–USD550 million, bringing total EBITDA to USD2.0 billion by 2027, up from USD1.4 billion in 2025.
