Braskem 3Q25: Liquidity Strain Deepens as Bonds Remain in Distressed Territory

Execution on secured funding, governance resets, and shareholder alignment is critical as weak fundamentals, high interest burden, and January coupons intensify default risk

We maintain Braskem with an Overweight recommendation, supported by our view that the company’s large domestic footprint, political relevance, and partial government ownership make a default event less likely in the near term. That said, the timing of liquidity measures and clarity on policy relief will be decisive for any re-pricing potential. At current spread levels, we think most of the downside risk is already priced in, with Braskem bonds trading in the $37–42 range. We favor exposure to the lower-priced bonds within the curve, where investors are better protected against potential haircuts, and find greater value in the 2030 notes, priced at $38.6 and yielding 32.0% for a 3.0-year duration. By contrast, we see elevated risk in the 2081 hybrid notes due to their coupon-deferral optionality and structural subordination.