CLARIANT: Still +8% on March 21, now already +20%!

After a certain dry spell, things are moving forward and the shares of the specialty chemicals group CLARIANT are turning from a takeover candidate into an "insider tip"! In any case, several securities firms jumped on the bandwagon last week, such as Exane BNP Parisbas, which now rates the share as Outperform with a price target of CHF 16. Citigroup has also switched from Neutral to Buy, also with a target price of CHF 16, assuming that the sales markets will soon pick up and margins will improve as a result. Have investors finally rediscovered the "Swiss pearl"? In any case, the share is still undervalued, even if CLARIANT's customers are not yet buying with the "big ladle", i.e. the end markets remain challenging. The high oil price is also likely to exert a certain amount of cost pressure for the time being. On April 30, when the figures for 1Q24 are published, we will see in concrete terms whether and what progress has been made and whether the trend is good enough to drive the share forward. Citigroup, the major US bank mentioned above, sees a unique opportunity to enter the sector; having any US investors on board is at least not a bad thing.

How the Group develops in China will also be important in the overall picture, as the Asian "economic giant" accounts for around 11% of sales. And CLARIANT even wants to increase this to 14% in the medium term. Without major political disruptive maneuvers, this is a clear plus point, but a certain "cluster risk" should nevertheless be kept in focus. China is no longer automatically a sure-fire success and there are also foreign chemical companies that are scaling back their involvement in the Far East. Overall, CLARIANT is and will remain innovative and attractive. In addition, the Group is already optimizing certain production processes with artificial intelligence (AI). At the target price of CHF 15.50, we are reducing half of the position (weighting)!