Citi downgrades Australia's Orica to 'neutral'

ORICA

29/02/2024 19:29

** Citi downgrades rating for mining solutions provider
Orica Ltd  ORI.AX  to "neutral" from "buy" but hikes target
price to A$18.5 from A$17.0
    ** Shares of Orica ended 0.5% higher on Thursday
    ** To retain a "buy" rating, ORI needs to have more
aggressive consumption expectations for ex-China commodity
demand in CY24 and into CY25 - brokerage
    ** Citi says it does not have a high confidence level around
Cyanco modelling assumptions at this early stage
    ** Orica said on Feb. 21 it would acquire U.S.-based
chemical company Cyanco Intermediate 4 Corp for $640 million to
expand its geographical reach in mining chemicals business
    ** Ten of 11 analysts rate stock "buy" or higher, one
"hold"; median PT is A$18 – LSEG data
    ** Stock up ~7% YTD

 (Reporting by Neha Soni in Bengaluru)
 ((Neha.Soni@thomsonreuters.com))