The sale of Incitec Pivot's fertiliser segment is not proceeding, which should result in a negative market reaction, according to Morgan Stanley, due to uncertainty around the strategic direction of the business.

On the flipside, the share price should gain some support from the commencement of the $900m buyback.

While negotiations have ceased with Indonesian company Pupuk Kaltim, management have indicated they will continue to pursue options for structural separation.

Equal-weight rating. Target $3.00. Industry view: In-Line.

Sector: Materials.

Target price is $3.00.Current Price is $2.90. Difference: $0.10 - (brackets indicate current price is over target). If IPL meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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