INCO – 3Q23 earnings in-line with our expectation

INCO – 3Q23 earnings in-line with our expectation Vale Indonesia (INCO) booked US$52.6mn of net profit in 3Q23, or declined by 25.4% qoq. The decrease in net profit was attributed to a lower average realized price by 9.8% qoq, while energy price mixed. Meanwhile, the production level grew 4.6% qoq in 3Q23. Despite the slowdown in profitability, it's worth noting that INCO achieved a higher profit of US$221.1 mn in 9M23, or grew by 31.3% yoy. (Source: Company) Comment: We view INCO's earnings for 9M23 is in-line with our expectations but fall below street estimates, coming in at 89.2% of our 2023 forecast and 82.0% of the market's consensus as we anticipate INCO may face further challenges in 4Q23 due to the ongoing decline in nickel prices and the impact of rising oil prices.