Orbia Advance Corporation (ORBIA.MX): It‘s About Simplification; Maintain Buy Rating

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Orbia Advance Corporation (ORBIA.MX): It‘s About Simplification; Maintain Buy Rating

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29 Jul 2026 19:00:14 ET │ 13 pages

Orbia Advance Corporation

(ORBIA.MX)

It’s About Simplification; Maintain Buy Rating

CITI'S TAKE

Buy

Orbia investors may weigh the fact that 2H26 looks less exciting than it did Price (29 Jul 26 14:00) P$24.22a few months ago against the possibility that management completes the

divestiture of Netafim. Our Buy rating is based on our view that PVC margins Target price P$28.00

remain above 2H25 levels and that some of the non-cash gains that helped Expected share price return 15.6%

drive the 2Q26 earnings beat versus consensus could reverse in the coming Expected dividend yield 0.0%quarters. While we still believe that the simplification strategy outlined by

management may finally begin to deliver tangible results, something that is Expected total return 15.6%

partly reflected in the stock’s re-rating—the completion of this transaction Market Cap P$47,665M

could help build investor confidence in management’s ability to take US$2,734Madditional steps to further simplify the business.

Model Update — We update our Orbia model after a 19% beat to consensus EBITDA,

and to incorporate fresh feedstock prices. We keep our Target Price of P$28.0/share Price Performanceand our Buy rating. We see Orbia trading at 6.6x-5.7x 2026-27E EV/EBITDA. In our

base case, we see 2026YE net-leverage declining to 2.8x from 3.2x as of 2Q26 (3.7x (RIC: ORBIA.MX, BB: ORBIA* MF)

as of 2025YE).

2026 EBITDA still points to $1.3bn — Above the >$1.2bn guidance, and in-line with

consensus. We understand part of the 19% beat to consensus EBITDA is explained

by some non-cash inventories gains that are likely to reversed in 2H26, explaining