S&P Global Ratings has revised the outlook for PTT Global Chemical - known as GC - to negative from stable, even as it affirmed the company's long-term issuer credit rating at 'BBB-'. The ratings agency flagged an extended downturn in the petrochemical sector that it says will postpone a meaningful recovery in GC's credit metrics.
S&P does not expect a material earnings turnaround for GC until at least 2027 and projects that the company's leverage will likely remain elevated in the 6.5x-7.5x range over the same period.
GC's full-year 2025 performance missed S&P's expectations, producing an adjusted debt-to-EBITDA ratio of roughly 9x. The rating agency attributed the weaker results to compressed product spreads and reduced sales volumes, the latter partly driven by planned maintenance at GC's refinery and its aromatics plant. Additionally, the ongoing restructuring of subsidiary Vencorex contributed to operating losses of nearly THB2 billion.
In response to these trends, S&P lowered its business risk assessment for GC. The agency cited persistent structural overcapacity in the global petrochemical market that it expects will continue to impair profitability over the next two to three years. The commissioning of larger, lower-cost petrochemical capacity in China and the Middle East has eroded GC's competitiveness in commodity chemical segments.
Over the last four to five years, GC's EBITDA margins have been depressed at approximately 3%-5%, a performance S&P said is weaker than that of global peers with comparable business risk assessments.
Looking forward, S&P projects GC's EBITDA to be about THB26 billion in 2026, a figure that is 25% lower than the agency's prior forecast. That projection incorporates expectations for somewhat higher petrochemical and refined fuel sales volumes over the next 12 months, supported in part by cheaper Gulf gas feedstock under Thailand's revised gas prices that took effect in January 2026.
Given constrained free operating cash flow under current market conditions, S&P anticipates GC will increasingly rely on a THB30 billion asset monetization plan to pay down debt. GC expects THB9 billion of that program to be completed in the first quarter of 2026, with the remaining THB20 billion to be delivered through several transactions.
The ratings agency also noted that continued financial support from parent company PTT will help underpin GC's credit profile. S&P estimates GC can access an additional THB20 billion-THB25 billion from an extended trade credit facility with PTT, which should assist in meeting refinancing needs through at least 2027.
S&P's change to a negative outlook reflects its assessment that persistent weakness in the petrochemical industry casts uncertainty over GC's deleveraging path during the next 12-24 months. That uncertainty increases the imperative for GC to adhere to plans to reduce leverage toward a 5x debt-to-EBITDA target and to successfully execute its asset monetization initiatives.
Clear summary
S&P has moved GC's outlook to negative while affirming a 'BBB-' rating, citing prolonged industry weakness, weak 2025 results with adjusted debt-to-EBITDA about 9x, structural overcapacity and the need for asset sales and parental support to reach deleveraging targets by 2027.