When viewing Sasol shares holistically, it becomes clear there were several obstacles, but also some wins, for the price for this stock over the last year.
A year ago, today, SSL shares sold for $20,28, whereas currently, they are $5,15. During March, Sasol was downgraded to junk status by Moody as a result of shares plummeting by more than 60 per cent, which in turn resulted in the chemical group’s long- term rating being lowered to Ba1, the first non-investment grade level.
However, after this, SSL shares started a steady climb during late March. It moved in an upwards direction when it experienced a slight dip at the beginning of October when shares were $7,66, and then saw a steady decline again up to where it currently lies.
During October, it was announced that Sasol had sold 50 per cent of a stake in the Base Chemicals business at the Lake Charles plant, and formed a joint venture with LyondellBasell, a chemicals giant. This substantially highlighted Sasol’s battle to attempt
saving its balance sheet.
By the end of June, Sasol reported a $5,4 bill loss due to a substantial decline in crude oil, as well as chemical product prices caused by the added impact that Covid-19 had on the industry.
In addition to this, Sasol was forced to shut down the Lake Charles operations as a result of interruptions caused by hurricanes. Hurricane Delta was the most recent on October 9, making it the second hurricane to disrupt operations in 2020.
Despite Sasol’s shares losing more than two-thirds of its value, the company hopes to restore its blue chip status, regardless of debt challenges and the unpredictable operating environment it finds itself in, on top of facing volatile commodity prices.