Al Ahly Pharos

Tourist arrivals rose 25% y/y in 1Q25 to 3.9 million. Tourism minister expects the 5% y/y increase in 2024 to be followed by an 8% y/y increase in 2025.

The House of Representatives will start discussing amendments to the Old Rent Law today.

The IMF said in its latest Regional Economic Outlook that “economic activity is expected to pick up but remain modest” this year in Egypt.

According to IMF data, public debt fell to 89% of GDP by the end of FY23/24, compared to 95.7% at the end of the previous year.

Fitch Solutions expects Egypt's economic indicators to gradually improve during the period from the current fiscal year until 2027/2028.

Net sales of government bonds and treasury bills by foreign investors amounted to approximately USD1.7 billion during the month of April 2025.

President El Sisi has given the final approval for the revamped Labor Law.

International oil companies Chevron, Shell, and Eni have submitted offers for exploration blocks in the Mediterranean.

Eni plans to inject USD1 billion in new investments in the Zohr field.

Japanese medical device manufacturer JMS, its local agent Interpharm, and the Egyptian Company for Medical Investments will establish a EGP1.4 billion factory for blood collection bags and tubes in Ain Sokhna’s industrial zone.

Chinese firm XinGaoyi Medical Equipment (XGY) and the Arab African Company for Medical Industries (AACMI) signed a partnership agreement to establish a factory to locally manufacture medical equipment.

Chinese solar tech company TrinaSolar is looking to increase its solar panel sales in Egypt by 20% y/y in 2025 to reach USD600 million.

CIEB 1Q25 consolidated bottom line recorded EGP1,869 million (-4% q/q, -18% y/y). CIEB is currently trading at P/E25 of 3.1x and P/B25 of 0.9x.

SWDY will distribute cash dividends of EGP1.00/share on 15 May 2025 for shareholders on record on 12 May 2025 (DY 1%).

The Ministry of Finance intends to unify the value-added tax rate on contracting activities at 14% instead of the 5% currently applied to supply and installation works combined. 

CIRA released its 2Q24/25 financial results, reporting a net profit of EGP226 million (+20.3% YoY, +26.8% QoQ). CIRA is currently trading at FY24/25f P/E of 29.6x and EV/EBITDA of 7.6x.

GBCO plans to introduce three new models of the Chinese automotive brand, Changan, in the Egyptian market during 2H25.

RMDA’s general assembly approved cash dividends of EGP0.11/share to be distributed over two equal installments in June and November. The assembly also approved 0.3:1 bonus shares.

ALCN released financial indicators showing 9M24/25 net profit of EGP5.4 billion, up 31.1% y/y.

CCAP has contracted with independent financial advisor Graviton Financial Advisory for Securities to conduct a study of the fair value of the company's shares. Upon completion, the extraordinary general assembly will be invited to consider increasing the company's capital.

- Market Overview 

- COMI

- ALCN

- RMDA

- ETEL

- OFH

- Prepared by: Mayada Amin- CETA, CFTe

*Key news articles for today*

Egypt is having to increasingly look to debt to bridge the budget deficit and repay its debt obligations, with the government financing gap in the next fiscal year’s draft budget up by over 25% to EGP 3.6 tn. The widening shortfall is attributed to a fall in non-tax revenues coupled with increased social spending.

The days of investors trudging from government office to government office to get projects off the ground may soon be over, with the state set to launch its in-the-works online unified licensing platform next month.

The exchange rate of the USD against the EGP fell below EGP 51 this week, as US reduced customs duties began to bring out relief for the market. The rebound in the value of the EGP is down to an increase in foreign investment inflows, a senior banking source said.

The Deputy Minister of Electricity, revealed that investments in the project to export Egyptian electricity from renewable energy sources will range between USD15 and USD20 billion, adding that the government recently completed preliminary studies for the project and is in the process of conducting detailed and final studies in cooperation with the Emirati company K&K.

The number of tourists arriving to Egypt increased by 25% year-on-year during 1Q2025, reaching 3.9 million tourists.

The CBE withdrew EGP740.85 billion through the weekly open market auction, with an annual return of 25.5% and for a period of 7 days.

ExxonMobil is seeking to sell its only gas discovery in Egypt, Nefertari-1, as it believes the discovery does not fit within its portfolio in terms of the reserves required to begin development and production operations, as it focuses on discoveries with reserves exceeding 4 trillion cubic feet of gas.

TMGH (FV: EGP75.00, OW) is in advanced stages of negotiations to develop a mixed-use project on a 14.0 million sqm land plot southwest of Baghdad in Iraq. The project is expected to host around 45k mixed-use units and generate sales of around USD17.0 billion and recurring income of over USD1.5 billion per year upon completion. TMGH expects to receive the land by the end of 2025.

SUGR released 1Q25 financial indicators, with net profit reaching EGP315 million (+45.3% YoY. +8.7% QoQ). SUGR is currently trading at FY25f P/E of 4.9x.

SWDY stated they haven't signed new industrial projects in Iraq, but they are still studying some potential ventures.

Market Overview 

Prepared by: Mayada Amin- CETA, CFTe

China’s Wu’an Xin Feng has kicked off construction on its planned USD1.7 bn integrated industrial complex in Ain Sokhna’s Industrial Zone, the Suez Canal Economic Zone (SCZone) said in a statement. The two-phase complex being built by the company’s Egyptian arm Xin Feng Egypt Steel will be completed over a five-year period and create 8k direct jobs.

The Asian Infrastructure Investment Bank (AIIB) is putting together USD300 mn in budget support for Egypt, Planning and International Cooperation Minister Rania Al Mashat said. The agreement is expected to be finalized by June, Al Mashat said, adding that negotiations have been completed.

Kuwait’s Bukhamseen Holding plans to invest between EGP30-40 bn in Egypt over the coming two years, Asharq Business reports. The investment ticket, currently equivalent to USD590.0-786.6 mn at today’s exchange rate, will go toward several sectors, with a focus on hospitality.

Five Arab and foreign investment funds are negotiating with the Egyptian government to acquire strategic stakes in government hospitals and pharmaceutical companies that were recently listed as part of the IPO program, according to government sources. They added that Emirati and Saudi companies are the most interested in the Egyptian pharmaceutical market, and they expect the coming period to witness major acquisitions in this sector.

Egypt’s non-oil trade deficit narrowed by 27.7% y-o-y in 1Q 2025 to USD6.3 bn, according to a government document. This was supported by a 27% y-o-y rise in non-oil merchandise exports, reaching USD12.7 bn, up from USD10.0 bn.

The overall state budget deficit decreased during 8M FY2024/25 to EGP879.3 billion, 5.1% of GDP, compared to EGP898 billion, equivalent to 6.5% of GDP, during the same period of the previous year. This was due to a 32.8% growth in general revenues to EGP1.442 trillion, compared to EGP1.086 trillion.

The central bank sold USD984.9 mn in one-year USD-denominated t-bills yesterday at an average yield of 4.25%, surpassing its USD950.0 mn target, according to data on its website. The issuance will go toward refinancing an outstanding debt worth USD950 mn.

TMGH is negotiating with the Iraqi government to develop an administrative project in Baghdad, with the project expected to cost over USD10.0 billion and cover a land area of 35.0 million sqm. The final agreement is expected to be reached by the beginning of 2026.

OCDI reported annually solid 1Q25 revenue of EGP2.8 billion, up 50.0% y/y and down 20.5% q/q, and net profit of EGP950.7 million, up 143.7% y/y and down 40.3% q/q.

CCAP expects ASEC Mining's (ASCOM) disclosed impairment, amounting to EGP320.5 million, will have a negative impact on CCAP's consolidated net profit on 31 December 2024 of c. EGP190.6 million. Noting that the impairment has been booked until the legal proceedings, which may result in the return of the pledged shares or their value, are completed. 

EFID plans to invest EGP1.0 billion in 2025 to expand its production capacity.

Weekly Commodities Update

 |   | Last Price | WoW Change, %
| Brent, USD/bbl | 66.9 | -1.6%
| Diesel-HSFO Spread, USD/ton | 216.7 | 2.1%
| Egypt Urea, USD/ton | 392.5 | -0.6%
| Polyethylene, USD/ton | 940.0 | 0.0%
| Polypropylene, USD/ton | 990.0 | -0.5%
| LME Aluminum Cash Price, USD/ton | 2,396.3 | 2.9%
| LME Copper Cash Price, USD/ton | 9,376.4 | 2.4%
| Egyptian Retail Cement, EGP/ton | 3,527.0 | 0.1%
| Steam Coal FOB Newcastle Australia, USD/ton | 93.8 | -1.4%
| SMP, USD/MT | 2,795.0 | -2.8%

- Market Overview 

- HRHO

- MASR

- RMDA

- MFPC

- TAQA

- Prepared by: Mayada Amin- CETA, CFTe

We published this morning our earnings expectations sheet for companies under coverage in 1Q25/FY25, with the following key conclusions:

• In FY25, aggregated net profit is expected to increase 10% YoY
• Stocks that are expected to witness a shift from net loss to net profit YoY in 1Q25: ORHD and EGCH
• Stocks that are expected to witness a spike (>80%) in net profit growth YoY in 1Q25: MBSC, CNFN, FAIT, MCQE, and ARCC. (sorted from highest rise in net profit)
• Stocks trading at P/E 2025 less than 5x: CCAP, EGBE, CICH, ADIB, and CANA. (sorted from lowest P/E)

Please refer to our sheet published this morning for detailed earnings expectations and trading multiples.

Egypt’s total local and foreign debt repayment obligations are projected to jump around 30% to EGP2.1 trillion in the next fiscal year, up from an estimated EGP1.6 trillion for FY24/25.

The Finance Ministry intends to issue new local debt instruments worth EGP1.5 trillion in the upcoming fiscal year, up from EGP1.2 trillion in the current fiscal year, as part of the government's plan to raise spending on social welfare and narrow the budget deficit.

Egypt is among six Arab countries set to face a significant impact from Trump’s tariff regime, assuming the tariff measures are fully implemented, the United Nations Economic and Social Commission for Western Asia (ESCWA) said in a policy brief. A significant impact is defined as at least 5% of a country’s global exports going to the US.

The state is working to liberalize the country’s electricity market by 2026, along with restructuring the Egyptian Electricity Transmission Company (EETC) and its separation from the Egyptian Electricity Holding Company (EEHC).

Federation of Egyptian Industries delegation is in Riyadh to talk investment in the Kingdom during a three-day business forum that wraps tomorrow. 

The government has estimated the financial allocations needed to import LNG and diesel shipments to meet the country's fuel needs during FY25/26 at approximately USD9.5 billion, compared to more than USD6 billion spent so far this year.

President El-Sisi approved a USD500 million loan agreement from the International Bank for Reconstruction and Development (IBRD) to finance the Development Policy Financing for Resilience program.

Scatec’s 1 GW Obelisk solar plant will be connected to the grid by 220 kV transmission lines built under a contract between the Egyptian Electricity Transmission Company (EETC) with the consortium of Kharafi National and Power Ring. The project is planned to power EGAL’s aluminum complex in Nagaa Hammadi. 

CCAP's United Foundries Company is planning to invest up to USD10 million in a new foundry in Helwan focusing on producing castings for the gold mining and cement industries, adding some 40k tons to the company’s production capacity and bringing total output to around 70k tons annually.

Hilton will open two new hotels in the New Capital. The two hotels, Hilton Cairo New Capital Downtown and Hilton Garden Inn Cairo New Capital Downtown, are scheduled to open in 2028.

- Market Overview 

- COMI

- ALCN

- PHDC

- EFIH

- ORAS

- ORHD

- Prepared by: Mayada Amin- CETA, CFTe

The World Bank sees the Egyptian economy growing at a 3.8% y/y clip during the fiscal year 2024-2025, raising its outlook 0.3 percentage points from its 3.5% forecast in October.

The Finance Ministry is considering exempting imported auto parts used in manufacturing from the 3% state development fee, to instead collect the fees upon commercial sales and during license renewals, following a proposal from car manufacturers, a government source said.

Egypt’s unemployment rate dropped to 6.6% of the total workforce in 2024, down 0.4 percentage points from 2023, according to data from CAPMAS.

The Finance Ministry has issued a guide clarifying the eligibility criteria, obligations, and penalties under the newly approved tax code as well as the dispute-resolution mechanism that it outlines. SMEs will be taxed on their turnover, eliminating arguments with tax inspectors over expenses. The rates are ranges from 0.4% for companies with annual revenues below EGP500k; and 1.5% for revenues between EGP10 million and less than EGP20 million.

Trump is demanding that American military and commercial vessels pass the Suez Canal and Panama canal “free of charge”. 

The Transport Ministry is offering up 23 dry ports and logistic zones investment projects, it said in a statement. 

Twenty French companies have begun serious negotiations with the Egyptian government to establish various projects in the Egyptian market, as part of their strategy to expand beyond their country's borders.

The Suez Canal Economic Zone (SCZone) is anticipating total investments of more than USD90 billion in the green hydrogen industry, according to the zone's Vice President. 

Chairman of the Suez Canal Authority, Osama Rabie, revealed that the Authority aims to restore approximately 70% of the number of ships that used the Canal by 2023.

- Market Overview 

- COMI

- HRHO

- FWRY 

- EFIH

- AMOC

- PHDC

- prepared by: Mayada Amin- CETA, CFTe