This report is an updated version of the report published on 3 January 2025 at 2:31 PM AEDT.

Ampol Limited (ASX: ALD)

Company Overview: Ampol Limited (ASX: ALD) is an Australian transport energy provider engaged in refining, importing, and marketing fuels and lubricants.

Recommendation Rationale - SELL at AUD 29.240

• Higher Finance Costs: During H1 FY24, Finance Costs increased by 10% YoY due to increased interest rates.
• Lower EBITDA: During H1 FY24, RCOP EBITDA (excluding significant items) declined by 7.7% YoY due to Lytton production disruptions.
• Transition to Renewables: Ampol faces challenges in transitioning to a low-carbon future. If it fails to adapt effectively, it may lose market share to greener alternatives.
• Decline in Total Sales Volume: During Q3 FY24, Total Sales Volume fell by 5.7% YoY due to planned maintenance.

ALD’s Daily Chart

 (Source: REFINITIV; Analysis by Kalkine Group)

Valuation Methodology: Price/Cash Flow Approach (FY Dec'25E) (Illustrative)

ALD is expected to trade at a discount compared to its peers considering its Sales Volume decline in Q3 FY24, lower EBITDA and higher Finance Costs in H1 FY24. For conducting the valuation, the following peers have been considered: Viva Energy Group Ltd (ASX: VEA), AGL Energy Ltd (ASX: AGL), and Endeavour Group Ltd (ASX: EDV).

Considering the volatile market condition, risks associated, and the share price can face consolidation at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of AUD 29.240, as of 3 January 2025, at 3:08 PM AEDT.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 3 January 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Dividend Yield may vary as per the stock price movement. 

Note 5: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.