DOW Increases Propylene Glycol Capacity in Thailand Facility

Dow Inc. DOW recently announced the start-up of propylene glycol capacity increase at its integrated manufacturing facility at Map Ta Phut, Rayong, Thailand. The low capital intensity, high-return incremental expansion boosts PG capacity by 80,000 tons per year, bringing total output to 250,000 tons per year, making the Dow Map Ta Phut PG manufacturing facility the largest of its kind in the Asia Pacific.
The back-integration at the Map Ta Phut facility ensures a cost-competitive supply of essential upstream PG raw materials such as propylene oxide (PO) and a dependable supply position to support growth in downstream high-value PG markets. The expansion of DOW's Map Ta Phut site not only optimizes the company's current asset infrastructure but also strengthens its regional and global industry leadership, allowing it to better serve customers.
Dow's propylene glycol business upgrades fundamental chemical building blocks to make high-quality ingredients for cosmetics, food, pharmaceuticals and a wide range of everyday items. The company is expanding sustainable PG production by employing lower carbon energy sources and adopting bio-circular and circular feedstocks using the mass balance approach at PG manufacturing plants around the world under ISCC PLUS certification.
Dow has introduced new PG solutions with externally proven sustainability benefits in North America, Europe and Latin America. It intends to gain ISCC PLUS certification for the Map Ta Phut PG facility by the end of 2024.
Shares of DOW have gained 14.4% over the past year compared with a 2% rise of its industry.

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On the first-quarter call, Dow said that demand in key end-use markets such as packaging, mobility and energy applications is trending higher sequentially, which is in sync with its expectations at the beginning of the year.
The company expects its high-value organic growth investments and advantaged portfolio to allow it to deliver earnings growth and increased shareholder value as the economic recovery gains strength. This provides DOW with the financial flexibility to advance its Decarbonize and Grow and Transform the Waste strategies, which are expected to deliver more than $3 billion in underlying earnings improvement annually by 2030.

Zacks Rank & Key Picks

Dow currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the basic materials space include ATI Inc. ATI, Carpenter Technology Corporation CRS and Ecolab Inc. ECL.
ATI carries a Zacks Rank #1 (Strong Buy) at present. ATI beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 8.3%. The company's shares have soared 62.3% in the past year.
Carpenter Technology currently carries a Zacks Rank #1. CRS beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 15.1%. The company's shares have soared 128.4%% in the past year.
The Zacks Consensus Estimate for Ecolab's current-year earnings is pegged at $6.59 per share, indicating a year-over-year rise of 26.5%. ECL, a Zacks Rank #2 (Buy) stock, beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 1.3%. The company's shares have rallied roughly 35.6% in the past year.

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