In the midst of the sharp 6.2% fall experienced by the Chilean stock market on Monday, after learning that the next President will be Gabriel Boric, the role of SQM-B sank 14%. Although the election result had to do with the collapse, the hardest blow came from a Bank of America (BofA) report analyzing how the new government could affect the company.
The day after the voting, the SQM-B share was the most traded, with a volume that exceeded 1.23 million shares. The following days, the paper recovered part of the losses and yesterday rose 3.04%, but accumulates a drop of 8.73% and is at a price of $ 43,800, the lowest in almost two months.
What did BofA do? It lowered its target price for the non-metallic miner’s ADR from US $ 67 to US $ 50. With Boric’s arrival, the bank said that “while higher taxes and interference from existing concessions are not formally considered , could be a potential risk for SQM ”.
Along these lines, the President-elect proposed to create “a national lithium company that develops a new national industry of this strategic resource, with community leadership and adding value to production.”
Regarding BofA’s fears, Renta4’s studies manager, Guillermo Araya, believes that “the agreement reached with Corfo under the administration of the entity’s former vice president, Eduardo Bitrán, could be reviewed.” In his opinion, the most important thing is the renewal of the concession contracts in the Salar de Atacama, beyond the year 2030, but he explains that “this would not depend on the government in power, but would be a matter that could be determined by the Convention Constitutional”.
– .
