Rallying Unigel Bonds Are a Top Pick for Lucror in Latin America

(Bloomberg) -- Unigel Participacoes SA bonds rallied to their highest level since March after the Brazilian petrochemicals maker posted better-than-expected quarterly results, Lucror Analytics said, naming it among its top picks for Latin America.

*Unigel bonds due in 2026 gained 1 cent to 92.3 cents on the dollar, according to data compiled by Bloomberg

*Yield fell to 10.49% from over 20% earlier in the year

*Quarterly earnings reported Friday showed robust cash generation

**“We believe Q2 was the turning point for Unigel’s leverage development,” Lucror analyst Soummo Mukherjee wrote in a note Tuesday

*Lucror expects Unigel to continue on a deleveraging trajectory with the following positive catalysts:

**Approval of legislation that could open “the Brazilian natural gas market and further reduce input costs for the company’s fertilizer production”

**Removal of the negative outlook by S&P

**Medium-term refinancing of the bond and a potential IPO

By Ezra Fieser