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Highlights

  • Dyno Nobel shares inch up 0.2% to AU$2.625 despite a 10.6% decline year-to-date.

  • Citi and Morgan Stanley offer mixed views on the company’s fertiliser distribution divestment.

  • Citi cautious on explosives business growth; Morgan Stanley calls divestment proceeds “underwhelming.”

Shares of Dyno Nobel Ltd (ASX:DNL) remained largely unchanged on Tuesday, edging up 0.2% to AU$2.625 in afternoon trade. The modest rise comes amid broader market gains, although Dyno Nobel stock remains down 10.6% year-to-date, including today's movement.

The key development drawing attention is the company’s planned divestment of its fertiliser distribution business to Ridley Corporation Ltd (ASX:RIC).

Mixed Broker Reactions

Brokerages Citi and Morgan Stanley have weighed in with cautiously optimistic assessments of the divestment. Both see the deal as a constructive step in the company's broader restructuring strategy. However, Morgan Stanley expressed disappointment with the expected financial outcome, describing the proceeds as “underwhelming.” The firm also stressed that the market must wait for a full separation of the fertiliser business before judging the strategic impact of the move.

Meanwhile, Citi has adopted a more guarded tone, particularly regarding the company's core explosives segment. While analysts acknowledged that the divestment signals a clearer focus on explosives, they remain cautious about the pace of growth across regional markets. Citi projects that the explosives segment will remain a dominant earnings contributor, with second-half FY2025 EBIT in the Americas and APAC expected to contribute 60% and 65%, respectively.