Kepler starts Elkem at 'buy', with silicones unit sale set to sharpen focus

Elkem ASA

03/12/2025 11:25

** Kepler Cheuvreux initiates Norway's Elkem ELK.OL with a "buy" rating, citing its transformation into a simpler firm after the planned sale of its silicones business

** The strategic pivot makes Elkem a focused upstream supplier of silicon products and carbon solutions, a shift from its earlier strategy of becoming a specialized chemicals company, the broker says

** It sets a PT of NOK 32.1/share, which assumes the silicones unit sells at the low end of Elkem's guided fair value range, NOK 10.5-21.1 billion ($1.0-2.1 billion)

** A higher sale price could significantly lift the company's fair value, making the risk-reward attractive, it adds

** Kepler adds it believes the markets, weakened by oversupply from China, have bottomed out, forecasting a gradual recovery towards mid-cycle levels

** Out of seven analysts that cover Elkem, five rate it "strong buy" or "buy" and two "hold", according to LSEG data

($1 = 10.0753 Norwegian crowns)

(Reporting by Marta Frackowiak)

((marta.frackowiak@thomsonreuters.com))