Barclays is bearish on European Chemicals & Ingredients, warns of structural decline

Victrex

12/11/2025 11:00

** Barclays starts European Chemicals & Ingredients with a "negative industry view", adding the sector is "structurally impaired"

** Unless Europe regains cheap Russian gas or China's slowdown cuts capacity, European chemicals may face an inevitable decline, Barclays says

** "We expect most European chemical manufacturing that faces global competition to disappear over the next two decades, like many other EU manufacturing sectors over the last 30 years," it adds

** The brokerage cuts Arkema AKE.PA to "underweight" from "equal-weight", citing a potential risk to dividend payment, poor returns since 2019 from organic capex and M&As

** The brokerage prefers IMCD IMCD.AS "overweight" over Azelis AZE.BR, which it cuts to "equal-weight" from "overweight", citing the former's better incremental return on investment and stronger balance sheet

** It cuts Evonik EVKn.DE to "equal-weight" from "overweight" on higher restructuring charges and lower earnings quality

** The broker downgrades Lanxess LXSG.DE to "underweight" from "equal-weight", pointing to leverage concerns

** It cuts Victrex VCTX.L to "equal-weight" from "overweight" on structural concerns in near-term

 (Reporting by Amir Orusov)

 ((Amir.orusov@thomsonreuters.com))