The IMF forecasts Egypt’s real GDP to slow to 3.7% in 2023, from 6.6% in 2022, but to recover to 4.1% in 2024, in light of the current FX crunch. The fund is now projecting inflation in Egypt to average 24.4% in 2023 and to rise further to 32% in 2024.

The National Bank of Egypt and Banque Misr will today launch two new USD certificates of deposit, one with a 9% annual percentage rate that pays out interest in EGP upfront and another with a 7% rate that pays out in USD quarterly.  

Egypt’s current account deficit narrowed by 40% y-o-y to USD 3.5 bn in 3QFY22/23, where:

• Oil and gas exports fell almost 40% y-o-y to USD 3.2 bn during the quarter.  
• Non-oil exports declined to USD 6.4 bn compared to USD 6.6 bn.  
• Tourism revenues rose 25% y-o-y to USD 3 bn. 
• Suez Canal revenues saw a 29% increase to USD 2.2 bn. 
• FDI halved y-o-y, falling to USD 2.2 bn. 
• Remittances fell more than 30% y-o-y to USD 5.5 bn. 

Subsidies for petroleum products in Egypt decreased by 2% YoY to EGP58 billion in FY22/23, double the subsidy targeted in the budget.  

Egypt’s holdings of US Treasury bonds reached USD1.1 billion in May 2023, down from USD24.4 billion in February 2020.

The Ministries of Petroleum and Electricity have agreed to import fuel oil in order to replenish the reserves used to produce electricity. 

Bloomberg reported that the Egyptian government asked urea producers to reduce production output considering the need for conserving gas in light of the heat wave. We contacted with producers who noted that the stoppage was for 1-4 days only last week during July and that production levels are back to normal this week. However, prices are now above USD400 per ton.

Silverstone Capital Investments, an entity controlled by Qalaa Holdings (CCAP), transferred 270.5 million shares worth EGP1.6 billion and representing 20% of TAQA to one of its creditors, namely the military’s National Service Projects Organization.

Dubai-based National Paints Holding (NPH) acquired the 20% of EGX-listed Paint and Chemical Industries (Pachin) that it didn’t already own for EGP9.21 million.

Zamil Steel - Egypt is in negotiations with the Ministry of Supply and ORAS to establish 10 strategic storage facilities for pharmaceuticals and food commodities.

FWRY announced evaluating Saudi expansion through preliminary discussions with Saudi Payments. Additionally, FWRY confirmed evaluating potentially applying for a digital bank license.

Market Overview 



prepared by: Mayada Amin - CETA, CFTe

[Correction] The US Federal Reserve is expected this week to take the last step in its tightening cycle by raising interest rates by another 25 bps.  

The cabinet denied media reports that have claimed that the production at the Zohr gas field has declined due to technical problems. 

EGP-denominated bonds’ value rose on the Luxembourg Stock Exchange. The cost of insuring Egypt's 5-year sovereign debt (CDS rates) hit 12.76%, while non-deliverable forward contracts for the Pound against the Dollar amounted to about EGP40.70. 

World Bank data revealed that Egypt has debt repayments worth USD15.3 billion in 3Q2023, out of which USD7.7 billion is for GCC deposits, or renewable.  

CBE has notified banks of the cancelation of the 11% subsidized lending tourism initiative, and to stop granting any new funding under the initiative. Work is underway on a new initiative. 

ORHD (FV: EGP20.38, OW) plans to open its fourth yacht marina in El Gouna in 2023. 

Tourist yachts will now be able to obtain entry permits to Egypt through the Transport Ministry’s digital platform within 30 minutes.

RMDA's shareholders approved increasing the company's capital by EGP127.88 million to EGP380 million through issuing 0.507 bonus shares for each original share held. Then, decrease the company’s capital by EGP5 million to reach EGP375 million through the cancellation of 20 million treasury shares.

ECARU (Egyptian Company for Solid Waste Recycling), Qalaa Holdings (CCAP), and Axens signed a cooperation protocol to carry out technical and economic studies for a project of second-generation biofuel (advanced bioethanol) and Sustainable Aviation Fuel (SAF) production.  

One of TAQA’s major shareholders transferred 270.5 million shares worth EGP1.6 billion and representing 20% of the company to one of its creditors. 

Japanese manufacturer Yazaki will begin construction of its EUR 30 mn factory in Fayoum’s first free zone after signing land contracts with local authorities. 

Weekly Commodities |            Last Price        WoW Change, % 

Brent, USD/bbl            81.1     1.5% 

Diesel-HSFO Spread, USD/ton          348.0   14.7% 

Egypt Urea, USD/ton  405.5   7.4% 

Polyethylene, USD/ton           1,020.0            3.0% 

Polypropylene, USD/ton         885.0   0.0% 

Steel/Iron Ore Spreads, USD/ton       367.4   -3.0% 

LME Aluminum Cash Price, USD/ton 2,164.5            -3.0% 

Egyptian Retail Cement, EGP/ton      1,710.0            0.0% 

Steam Coal FOB Newcastle Australia, USD/ton            133.0   1.0% 

SMP, USD/MT            2,503.0            -0.9% 

Market Overview 

prepared by: Mayada Amin- CETA, CFTe

COMI (FV: EGP 68.54, OW)  2Q23 net profit post minority recorded a robust EGP7.99 billion (+32% q/q, +127% y/y), bringing 1H23 profit for equity holders to EGP 14.1 bn (+81% y/y). Robust sequential performance came on the back of 1) strong margins, 2) lower OPEX, 3) lower booked provisions, and 4) lower effective tax rate. The stock is trading at P/E 2023 of 6.1x and P/B 2023 of 1.9x.

The Federal Reserve will hold its two-day policy meeting on Tuesday and Wednesday this week. An unexpectedly large slowdown in inflation in June led consensus to expect a hold on rates. 

The Egyptian economy grew at a 4.2% clip in FY22/23, down from 6.6% the year before.  

The government is currently in talks for some USD 400 mn in financing from the Abu Dhabi Fund for Development to help finance Egypt’s wheat imports. 

The cabinet gave its preliminary approval to grant five new golden licenses with an investment value of more than EGP 10.2 bn.  

The Commodity Exchange is discussing with the Ministry of Supply offering sugar for trading through it in an attempt to control the unexplained spike in local prices. 

Power outage in Egypt is caused by insufficient gas and diesel supplied to the Ministry of Electricity. 

Oil prices rose 1.2% WoW to settle at USD81.07/bbl, buoyed by growing evidence of supply shortages in the coming months and rising tensions between Russia and Ukraine.

Rebars retail price dropped by around EGP3k/ton compared to last month due to slowing raw materials prices and low local purchasing power, according to local media.

Local pharma manufacturer “Gennecs” plans to invest USD150 mn in its Gennvax factory that will produce medicines, serums, and vaccines. 

Electrolux will sell its factories and brands in Egypt as part of its global reprioritization plans.

The local arm of Chinese home appliances giant Midea Electric will establish a USD105 mn factory to manufacture home appliances.

Basata Pay (MTIE/BINV) plans to expand its network of branches to 30 by July 2024, up from 3 currently.

PHDC (FV: EGP3.99, OW) closed a EGP472.5 million securitization.

ARAB (FV: EGP0.65, EW) declared 1:10 stock dividends. Record date is 8 August. Distribution date is 9 August.

Market Overview 
COMI
ETEL
ORAS
JUFO


Prepared by:Mayada Amin- CETA, CFTe

All tourism projects will be eligible for the golden license and will receive the necessary approvals to start operations within 20-days of applying.

The Sovereign Fund of Egypt has reportedly received three offers to buy stakes in military-owned fuel retailer Wataniya, from the Abu Dhabi National Oil Company (ADNOC), the Emirates National Oil Company (ENOC), and Saudi firm Petromin.

Several Gulf investment funds are eyeing a minority stake in Misr Digital Innovation (MDI), a company set up by Banque Misr to launch its digital banking arm. The bank is willing to sell 10-20% of the digital bank.

The government plans to launch an international tender for the exploration of minerals in the eastern and western deserts before the end of the year. 

The CBE is studying allowing money transfers from Saudi Arabia and the United Arab Emirates through Instapay.

The Ministry of Finance will start paying EGP313 million in export subsidy to 64 exporting company today.

CIRA released their 9M22/23 results showing attributable net profit recorded EGP351 mn, pressured YoY by 17.2%. NPM reached dropped to 17.5% from a previous 28.9% in 9M21/22 with a YoY squeeze of 11.5pps. The drop in profitability came trickling down of weaker gross profitability due to the rise in operating cost as well as recognition of construction costs that were not present in 9M21/22. Revenues for the period reached EGP2,006 mn, with a YoY rise of 37%. CIRA is currently trading at a FY22/23 P/E of 15.7x and an EV/EBITDA of 7.0x.

The Ministry of Electricity is preparing to allocate about one million square meters for ORAS in the next few weeks, to inaugurate wind stations in West Sohag, with investments amounting to USD3 billion

The General Authority for the Economic Zone of the Golden Triangle has received three offers from local and international investors to establish fertilizer complexes in the Golden Triangle in Red Sea governorate at a combined USD1.6 billion of investment.

HELI Board approved studying an offer received on the company's Heliopark land plot.

TMGH intends to issue securitized bonds worth EGP500.0 million backed by club memberships.

BINV BoD approved the conclusion of a financing contract worth EGP 150 million with the National Bank of Kuwait, without mentioning the details and uses of the loan.

Investors fully subscribed to BTFH blockbuster EGP 10 bn capital increase. 

Market Overview 
CCAP
FWRY 
TMGH
PHDC
MNHD
ISPH
ORAS
RMDA


prepared by: Mayada Amin - CETA, CFTe

Russia yesterday said it would withdraw from the grain export pact with Ukraine in a move that threatens to spark renewed volatility in global food prices. On the short-term, this will not have a significant impact on Egypt's wheat imports, since Egypt collected about 3.8 million tons of local wheat during the last season, which is enough for 6 months.

Saudi renewable energy firm ACWA Power yesterday signed a land allocation preliminary agreement with the Electricity Ministry for its planned 10-GW wind farm. ACWA will conduct feasibility studies for the project ahead of signing the final contracts.

Egyptian authorities are in talks with the Greek government about how to fund the planned 3-GW Egypt-Greece Interconnector (GREGY). 

The European Bank for Reconstruction and Development provided a USD100 million loan to Banque Misr, directed to lending to small, medium and micro local enterprises.

EFIH is considering applying for a digital banking license and expanding in Saudi Arabia within a month.

FWRY is considering applying for a digital banking license and expects to make a decision by the end of the year. The company is eyeing regional expansion, including Saudi Arabia, in 2024.

MTIE’s BoD approved to invest up to EGP205 million to acquire 40% in “B Pharma Holding” a company dedicated to investing in the pharmaceuticals distribution and trade services sector in partnership with BINV. 

The parliament will discuss the new taxes on tobacco products by next October. The budgeting and planning committee asked producers not to apply any price increases until the new tax rates are declared.

The government is studying to raise the prices for wheat, beats, and sugar cane supplied for different governmental entities for the next harvest season by EGP200-300/bu. This might affect SUGR margins.

SKPC’s BoD approved the fair value studies submitted by Baker Tilly, the independent financial advisor for both SKPC and Ethydco. Baker Tilly valued SKPC at EGP23.1 billion, and Ethydco at USD1.1 billion (EGP33.5 billion using an exchange rate of EGP30.9). The valuation of the new combined entity will be EGP50 billion. The new entity’s total number of shares should add up to 1.6 billion with a valuation of EGP30.6 per share. 

TALM released their 9M22/23 attributable net profit for the period recorded EGP345 mn compared to EGP277 mn in 9M21/22 (+24% YoY) with a margin of 48% versus 46% in the previous period. The rise came backed by higher revenues and margins, as well as a rise in net finance income to reach EGP19 mn compared to a previous EGP8 mn. TALM is currently trading at an annualized FY22/23 multiples of P/E 6.2x and an EV/EBITDA of 4.6x.

ADIB (FV: EGP 35.00, OW) and International Finance Corporation (IFC) have signed the first Shariah-compliant subordinated Tier 2 financing agreement worth USD 50 million. 

BINV's BoD agreed to conclude a financing agreement worth EGP 150 million with the National Bank of Kuwait. 

The House of Representatives will discuss and approve the Unified Insurance Bill in October. 

Rami Aboul Naga, Deputy Governor of the CBE, estimated the volume of Internet banking transactions at about EGP 3 trillion in 6 months. He added that a number of Egyptian banks have started to offer financial derivative products to customers.

MNHD (FV: EGP3.16, EW) signed an MoU with Misr Engineering Development Company to implement infrastructure development worth EGP1.0 billion in Taj City.

Market Overview 



Prepared by: Mayada Amin- CETA, CFTe