PETALING JAYA: The situation for Lotte Chemical Titan Holding Bhd
is not looking good.
Aside from analysts expecting the petrochemical manufacturer to post a loss of between RM400mil and RM500mil in the fourth quarter of financial year 2025 (4Q25), the global situation has not picked up either.
In a report, BIMB Research said the group lost RM1.1bil for the first nine months of financial year 2025 (9M25), and with just RM1.2bil cash left in its balance sheet, the outlook is extremely dim.
It’s worth noting the group has already experienced 14 quarters’ of loss-making, and the next one will mark the 15th.
“At the current pace, Lotte Chemical has barely two to three quarters before the liquidity cupboard runs bare based on the current cash burn run rate of RM120mil to RM140mil monthly,” it noted.
BIMB Research said, moving forward, it believes the next quarter will be another loss-making one on the back of weak petrochemical margins in the period and the negative impact of a strong ringgit against the US dollar.
The group also notably has a capital base that keeps thinning with every quarter that goes by. On the global end, BIMB Research said that global petrochemical margins remained weak in 4Q25, weighed down by soft end-demand, elevated supply and persistently low utilisation rates.
“Supply conditions in China and the Middle East remained more than ample, materially eroding producers’ pricing power despite discussions on supply rationalisation among producers in Japan and South Korea, there was still little impact on global balances.”
Investors should not be hopeful that the parent company, Lotte Chemical Corp, will step in yet again.
