KUALA LUMPUR, Nov 4 — Kenanga Research has ugraded Petronas Chemicals Group (PetChem)’s rating to ‘outperform’ from ‘market perform’ following its plan to acquire three companies through its involvement in the Refinery and Petrochemicals Integrated Development (Rapid) project.

PetChem said yesterday that it was officially involved in the Rapid project and was acquiring three companies, namely PRPC Glycols Sdn Bhd, PRPC Polymers Sdn Bhd and PRPC Elastomers Sdn Bhd from its parent company, Petronas.

Kenanga Research also lifted PetChem’s target price to RM7.50 from RM6.29 previously.

In a note today, the research house said PetChem was expected to spend US$3.9 billion (RM16.64 billion) for the project which would add 2.7 million tonnes per annum capacity to the group once it is fully operational by 2019.

The research house said PetChem had performed fairly well for an index-stock with 19 per cent appreciation year-to-date.

“With better petrochemical prices in the fourth quarter this year, new earnings from Sabah Ammonia Urea next year and the growth story arising from the Rapid project, PetChem is the stock to watch.

“Hence, we upgrade the stock to ‘outperform’,” added the research house.

At 11.40am, PetChem gained one sen to RM6.51 with 7,700 shares traded. — Bernama