From the Sector

Indorama Ventures Public Company Limited (IVL), a global sustainable chemical producer, today reported improved earnings for the first nine months of 2026, driven by deliberate management actions to optimize its asset footprint, reduce fixed costs and strengthen working capital, alongside supportive market conditions. 

In the first nine months (9M26), Indorama Ventures’ EBITDA rose 63% year-on-year (YoY) to THB 43.5 billion. EBITDA per ton increased approximately 75% YoY and the EBITDA margin widened to 11% from 8%, on 5% lower sales volumes. Lower volumes partly reflect capacity rationalization under IVL 2.0 and production aligned with sales and inventory targets. Net profit before impairments and exceptional items was THB 9.8 billion, compared with a loss of THB 2.6 billion a year earlier, while reported net profit was THB 5.3 billion. In 3Q26, EBITDA was THB 13.7 billion, up 65% YoY and down 37% from the second quarter, when market conditions were exceptionally strong. 

Through its Sales & Operations Execution (S&OE) discipline, IVL has steadily reduced its inventory exposure, so a future decline in crude prices should affect earnings far less than in past cycles. This also allows the company to gradually raise operating rates, which it deliberately curtailed in 2026, through 2027 and 2028. 

Despite crude prices rising by about one-third, inventory turns improved from 4.7x to 5.2x, and the company is targeting 6.0x. Operating cash flow after maintenance capex rose 47% to THB 34.5 billion, about 80% of EBITDA. Net debt fell by about THB 19 billion year-on-year, and net debt to EBITDA improved to 4.69x from 6.61x. 

Since 2023, Indorama Ventures has exited or restructured 10 uncompetitive sites, removing about 3.5 million tons of capacity. Most of these sites were in Europe and in the CPET and Fibers segments, where the structural reset in aromatics and industry overcapacity hit hardest. By moving production to its most competitive assets, the company kept its customers and market share while reducing total fixed costs by approximately THB 10 billion from 2023 levels, a structural saving that does not depend on market spreads. 

The consolidation of Indovida’s packaging business in India remains on track to complete in the first quarter of 2027 and is expected to nearly double Indovida’s EBITDA. Together with management actions and recovery in key businesses, this is expected to offset the normalization of 2026’s exceptional market conditions. 

Mr. Aloke Lohia, Group CEO of Indorama Ventures, said, “Favorable markets have supported our results this year, but they are not the whole story. Deliberate management actions are making us more competitive, improving the quality of our earnings and generating the cash to reduce debt. Our local-for-local model and access to feedstocks allowed us to serve customers reliably when they needed it most. 

“We enter 2027 from a stronger position, with a leaner cost base and lower debt. We reaffirm our 2028 ambitions to double EBITDA and reduce net debt to EBITDA to 3x or below, and I remain confident we will deliver the midway 2027 milestone we set out at our Capital Markets Day.”