OCI (XAMS:OCI, Financial) is a company that produces methanol and nitrogen-based fertilizers. It has very competitive costs, an excellent logistics network, and is backed by a family that owns more than 40% of the capital and has proved over the years that it knows how to invest well. Its financial position, without being bomb-proof, is solid for the low phase of the cycle we are in, there are no major short-term debt maturities and a possible sale of the methanol business would correct the balance sheet at once. At our average entry price, we estimate a FCF yield of 14%, which is attractive enough for the risks that we anticipate.
From azValor Asset Management's third-quarter 2020 letter.
