CLSA Securities wrote in an analysis that IRPC Public Company Limited (SET: IRPC) has reported a net profit of THB 2.9 billion (THB 0.14 per share) for the second quarter of 2026, a year-on-year increase of 237%. The decline of 63% quarter-on-quarter was attributed to a significant stock gain recorded in the previous quarter. Performance in refinery and petrochemical operations were key drivers of this result.
The company’s market gross refining margin (GRM), including lube base oil, rose to $13.5 per barrel, up from $11.8 per barrel in 1Q26, largely due to higher lube base oil spreads. Lube base oil alone contributed $4.1 per barrel to the GRM, compared with $1.3 in 1Q26. However, the refinery-only GRM declined to $9.4 per barrel from $10.5 in the prior quarter following a government price reduction and an export ban. The refinery run rate marginally fell to 94% from 97% in 1Q26.
Petrochemical margins improved noticeably, CLSA noted, with the market product-to-feed margin increasing to $2.8 per barrel from $0.6 in the previous quarter. This was supported by stronger spreads in HDPE, PP, and ABS. The power segment also contributed positively, adding $0.9 per barrel to the gross integrated margin (GIM), resulting in a total GIM of $17.1 per barrel for the quarter, up from $13.2 per barrel in 1Q26.
In the quarter, IRPC recorded a net stock loss of THB 3.7 billion and a hedging gain of THB 2.1 billion. The net profit for 2Q26 stood at THB 2.9 billion, a 237% rise YoY but a 63% decrease sequentially due to the previous quarter’s large stock gains.
Looking ahead, CLSA expects the company’s operations for the third quarter to remain strong, buoyed by healthy diesel crack spreads. Quarter-to-date GRM is estimated at $10 per barrel, according to the securities firm, despite a government price cut of $0.8 per barrel through mid-August.
The brokerage house anticipates further upside for petrochemical spreads, given regional feedstock shortages. Spreads for HDPE, PP, and ABS have shown strength in August, which is expected to support third quarter profits.
Reflecting tighter refinery supply than previously anticipated, CLSA raised IRPC’s GRM assumptions for 2026 and 2027 to $12 and $8.50, respectively. Earnings forecasts for 2026/27 were also adjusted up by 6% and 13%, with the target price increased from THB 2.40 to THB 2.80, pegged at 0.70 times 27CL PBV. The analyst also raised the company price-to-book ratio by one-notch to reflect the refinery supply condition.
