UK Chemicals Sector – Strengthens Its Position as the Top Choice for Cross-Border Expansion

This report is an updated version of the report published on 11 June 2025 at 08:11 AM GMT+1.

Section 1.0. UK Chemicals Sector Landscape, Trends & SWOT Analysis

The Chemicals industry is diverse in nature and includes the manufacturing of commodity/bulk chemicals, specialty chemicals, polymers, consumer chemicals, and others. The product of the sector finds its way in daily essentials like medicines, food, construction materials, etc. Some of the well-known companies in the space include Johnson Matthey PLC, Treatt PLC, Croda International PLC, etc. Kalkine’s Sector Report covers the Investment Summary, Sector Landscape, Trends & SWOT Analysis, Risks, Recent Business Updates along with the Valuation, Target Price, and Recommendation on the stock.

Section 2.0. Sector Risks & Opportunities

The UK chemicals sector continues to strengthen its appeal for cross-border expansion, supported by its advanced infrastructure, strong R&D ecosystem, and access to global markets. Strategic regulatory frameworks and a skilled workforce make the UK an attractive destination for international firms seeking high-value manufacturing capabilities. Despite post-Brexit adjustments, the sector remains resilient and well-positioned for international collaboration and investment.

After gaining insights into the Chemicals sector, we will look at the business model of two relevant players listed on the London Stock Exchange. 

Section1: Company Overview

Croda International PLC (LSE: CRDA) is an FTSE 100 listed company specializing in creating high performance ingredients and technologies that improve people's lives. Its sales, marketing and research activities are organized into three global market sectors: consumer care, life sciences and industrial specialties.

Section2:  Financial Highlights – 2024

Section 3:  Stock Recommendation Summary

Valuation Methodology: Price to Earnings Multiple Based Relative Valuation (Illustrative):

The stock has witnessed an upside of ~3.28% and of ~0.58% over the 1 week and 3 months respectively. It is trading below the average of 52-week high price of GBX 4,335.00 and 52-week low price of GBX 2,551.00, providing an opportunity to accumulate the stock.

One-Year Technical Price Chart (as of June 10, 2025). Source: REFINITIV, Analysis: Kalkine Group

Section4: Company Overview

Treatt PLC (LSE: TET), a constituent of the FTSE All-Share Index, is a UK-based global manufacturer and supplier of natural extracts and ingredients for the flavor, fragrance, and consumer goods industries, with a strong focus on the beverage sector. The company offers a sustainable and diverse portfolio of high-quality products catering to multinational clients.

Section5:  Financial Highlights – H1 FY25

Section 6:  Stock Recommendation Summary

Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative):

The stock has witnessed an upside of ~6.79% and downside of ~27.24% over the 1 week and 3 months respectively. It is trading below the average of 52-week high price of GBX 527.25 and 52-week low price of GBX 194.80, providing an opportunity to accumulate the stock.

One-Year Technical Price Chart (as of June 10, 2025). Source: REFINITIV, Analysis: Kalkine Group 

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

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is 10 June 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: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/ or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 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.’

Note 6: Dividend Yield may vary as per the stock price movement.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.