2025-05-27-Jefferies-元素is有限公司（ELM）_滑石粉出售_向前迈出变革性一步；重申买入_11页_409kb

Summary of Elementis PLC Equity Research

Rating: BUY
Price Target: 180.00p (+38% upside from Nov 27, 2025 closing price of 130p)

Talc Divestiture

• The sale of the Talc segment represents a transformative step for Elementis, eliminating an overhang from the carcinogen ruling and improving the company's focus on high-quality, high-margin businesses.
• Despite selling at a discount to the Mondo acquisition price, the transaction significantly improves the outlook due to reduced end-market exposure to weak European markets.

Investment View

• Reiterate "Buy" rating after positive update from the asset sale.
• Personal Care and Coatings (PC&C) segments are performing well marginally despite no volume leverage,
• Early achievement of the group's 19% margin target positions Elementis favorably among peers.
• New CEO enhances sentiment, and upcoming July strategic update is expected to be a catalyst.

Valuation

• 175p PT increases to 180p, pegged to FY2026 consensus EV/EBITA of 11.2x.
• Valuation support via FY2026F PE of 12.8x and significant discount to UK chemicals peers (16%).
• Reiterated net debt reduction, FX improvement and buyback also support PT.

Financials

• EBITA guidance for FY2025 remains negative but significantly lower than consensus.
• Talc removal drives discontinuous improvement in core operating performance metrics.
• Balance sheet remains strong with EBITA coverage up to 6.5x.

Summary of Impacts:

Current price   : 130p  
Price target    : 180p (+38% upside)  
Sector discount : 16% vs UK chemicals peers  
Outlook drivers : Improved PC&C margins; Talc divestment complete; Strong balance sheet  
Downside risks  : End-market weakness; Slow margin progress than expected  
Upside catalyst : July strategic update; CEO market influence; Potential spin-off speculation