Al Ahly Pharos

*Key news articles for today*

The Minister of Planning expects the agreement with the European Union to grant Egypt EUR4 billion in funding next June to support the budget as part of the structural reform program for the economy.

Egypt’s USD bonds were among the emerging markets’ top gainers following Trump’s return to the White House and the Gaza ceasefire. 

The government cleared up USD1 bn in arrears owed to foreign oil companies in the first week of January. A new schedule to settle the accumulated USD6.5 bn in arrears had been agreed on with companies, with repayments set to run from next month until June 2025.

The Suez Canal is preparing to receive the navigation services of major shipping lines, as it is expected to benefit from the ceasefire agreement in the Gaza Strip. The Houthis have announced a halt to attacks on American and British ships in the Red Sea region, after the Gaza truce agreement came into effect.

State-owned Arab Organization for Industrialization’s (AOI) joint solar panel manufacturing project with Sweden’s Sunshine Pro is set to be operational in July of this year and have a production capacity of 1 GW of panels by July 2026, AOI’s Arab Renewable Energy Company Executive Director said. The project is expected to cost somewhere between USD200-300 mn.

Over 12k medical tourists from 50 different countries visited Egypt for treatment in 2024, an increase of 200% y-o-y, the Egyptian Healthcare Authority said.

The government targets proceeds of EGP250 million to EGP350 million from the offering of Misr Pharmaceuticals Company during 1H25. Sources told local press that the government intends to offer a 25% to 30% stake in the company, in addition to offering the same stake in Seed Pharma.

OLFI Net profit recorded EGP279 million in 4Q24 (+70.9% YoY, -6.8% QoQ). In FY24, net profit recorded EGP1,000 million (+112.5% YoY). OLFI is currently trading at FY25f P/E of 7.4x.

BoD proposed cash dividend distribution of EGP2.0/ share implying payout ratio of 80% and dividends yield of 10.4%.

EGBE 4Q24 stand-alone bottom line recorded EGP620 million (-11% q/q, +69% y/y), bringing FY24 bottom line to EGP2,550 million (+80% y/y, and 18% higher than Al Ahly Pharos estimates). BoD proposed increasing the paid-in capital by EGP550.55 million through bonus shares and proposed cash dividends distribution of EGP0.99/per share.

Ministry of Environment assigned cement companies to expand in establishing waste recycling plants to produce alternative fuel (RDF), with five cement players have committed to fund 13 plants throughout 2025.

- Market Overview 
- BINV
- BTFH
- CLHO 
- PHDC
- EKHOA


- Prepared by: Mayada Amin, CFTE, CFTe

Our take on Trump’s return to the White House, becoming the 47th President of the United States: One of the main channels that might affect Egypt's economy is the fact that Trump's main economic policies might cause an upward pressure on the USD globally. Trump is pro expansionary fiscal policies, and likely to try to boost businesses in the US through tax cuts. This, in turn, might imply some inflationary pressures, which means the Fed might need to revise its pace of easing, that easing was long awaited for by the EMs in general to relief some of the pressure on their currencies. Besides, Trump's expected trade protectionism through tariffs means lower pressure on US current account, which also might mean a stronger dollar. In addition, such kind of trade policies might trigger some fears of a negative impact on the Chinese economy, causing some risk aversion in global financial markets that will eventually affect EMs cost of borrowing.

The head of the EGX said that six temporarily listed companies will offer their shares on the stock exchange during H1 2025. Regarding the offering of the companies “Safi” and “Wataniya”, he said that the procedures for listing the two companies have not yet begun, but we are anticipating them soon.

Around 500 Turkish garment manufacturers expressed interest in investing in Egypt last year with the total proposed investments amounting to around USD 5 bn, head of the Federation of Egyptian Industry’s apparel chamber said. Some 50 Turkish companies have already taken steps to move their operations over to Egypt, investing around USD 150 mn.

Government sources said that the average bond issuances in the international markets range between USD2.5 billion and USD3 billion annually until 2028.

The government is in discussions with the private sector to finalize studies on setting a more profitable feed-in tariff rate, the set price that the government pays for the electricity projects generate, for its initial phase of waste-to-energy (WtE) projects, a government source said. The new tariffs aim to ensure a good return on investment for companies currently making investments in the sector.

China’s JA Solar will supply 1.25 GW worth of solar panels for AMEA Power’s Abydos 2 project, located in Aswan's Benban, under an agreement with project builder China Energy Engineering Corporation, the solar panel manufacturer said in a statement. No details about the cost of the agreement were disclosed.

UAE-based Nas Investments Holding submitted a mandatory tender offer to acquire an additional 57.5% stake in EGX-listed fertilizers player EgyFert (SMFR). The move would bring Nas’ total holding in the company to 90% through the acquisition of an additional 5.5 million shares. If Nas hits its acquisition target, the total transaction would be valued at EGP522.5 million, with Nas paying EGP95.0 per EgyFert share, implying a 2024e annualized PE of 8.5x. Nas did not put forward a minimum acceptance threshold.

Misr Petroleum will establish and revamp 70 fueling and service stations nationwide in FY25/26, building on the 33 stations upgraded in 2H24, Misr Petroleum Chairman Mohamed Maged Bakheet said. 

The Financial Regulatory Authority (FRA) has issued a decision setting new increased minimum capital requirements for companies operating in the ins. sector, in line with the Unified Ins. Law ratified last year. T

SWDY reached financial close on its 50MW/100MWh battery energy storage system project in Greece. T

EGTS’s court date for the 20.0 million sqm third phase Sahl Hasheesh land plot lawsuit is postponed to 28 January 2025.

- Market Overview 
- BINV
- SWDY
- ARAB
- OLFI

Prepared by: Mayada Amin- CETA, CFTe

The General Authority for Investment and Freezones is looking into setting up a freezone in Minya that would house textile projects from a Chinese investment alliance that is eyeing USD1.5 billion in initial investments.

The Finance Ministry will launch an electronic tax system for clearing investors’ receivables and debts next month.

Net foreign assets of the CBE were almost flat at EGP592.469 billion (c. USD11.7 billion) by the end of December 2024.

The FRA issued a decree determining the minimum capital for insurance companies. The Authority obligates insurance companies to raise the minimum issued and paid-up capital in two stages over two years to reach EGP400 million in the first stage within one year, and in the second stage to EGP600 million by the end of the second year.

NTRA is set to launch WiFi calling services in Egypt today. The new service will enable mobile phone users to make high-quality voice calls over internet connections, rather than via mobile networks.

ESRS general assembly approved the issuance of corporate guarantees in favor of subsidiaries, sister companies, and related companies at a maximum of USD500 million or EGP equivalent. 

According to local media, HELI plans to develop a project on 25 feddans in New Heliopolis, with expected investment of EGP1.8-2.0 billion. The project is expected to generate sales of EGP4.0 billion.

Social Impact Capital (SIC) will soon have increased its stake from 51.2% to 88.7% in CIRA. The additional 37.5% stake will officially transfer to SIC upon the completion of the Mandatory Tender Offer.

Organi Group targets establishing a USD100 million chlorine pellets factory that will mark the Middle East’s first facility producing the swimming pool cleaner when it starts operations in 2025. 

The General Petroleum Company plans to drill 41 new oil and gas wells and repair or recomplete 39 others as part of its FY25/26 investment budget.

MICH posted EGP314 million in 1H24/25 net profit, a 12% YoY growth, supported by a 14% YoY growth in revenue to EGP528 million in 1H24/25.

Alamal Alsharif Plastics is expected to make its EGX debut through a direct listing in 2Q25. The listing will reportedly see the government-owned National Investment Bank divest its entire 29.5% stake in the company.

Weekly Commodities Update
 |   | Last Price | WoW Change, %
| Brent, USD/bbl | 80.8 | 1.30%
| Diesel-HSFO Spread, USD/ton | 302 | 8.60%
| Egypt Urea, USD/ton | 431 | 1.70%
| Polyethylene, USD/ton | 940 | 0.00%
| Polypropylene, USD/ton | 953 | 0.00%
| Iron Ore 65%, USD/ton | 122 | 1.10%
| Steel/Iron Ore Spreads, USD/ton | 370 | -1.00%
| LME Copper Cash Price, USD/ton | 9,082 | 1.00%
| LME Aluminum Cash Price, USD/ton | 2,674 | 4.50%
| Egyptia Retail Cement, EGP/ton | 2,847 | 0.00%
| Steam Coal FOB Newcastle Australia, USD/ton | 117 | 3.30%
| SMP, USD/MT | 2,682 | 0.00%
| Last price may vary week over week in some indices due to time difference

- Market Overview 
- CCAP
- ALCN
- OFH
- SCEM



- prepared by: Mayada Amin- CETA, CFTe

The CBE has released the Balance of Payment (BoP)'s performance report for 1QFY2024/25. The overall BoP recorded a deficit of USD991.2 million 1QFY 2024/25, as opposed to a surplus of c. USD230 million in the comparable period in the previous year. The current account deficit has surged by 110.5% YoY to USD5.9 billion in 1QFY2024/25 up from a deficit of 2.8 billion in 1QFY 2023/24, mainly fueled by a record-high trade deficit at USD14 billion, the highest trade deficit for a single quarter on our records which go back to 2001.

The IMF and the WB have slashed Egypt's growth forecast for the current fiscal year and the upcoming fiscal year in their respective outlooks. The IMF now sees the economy growing at a 3.6% clip during the current fiscal year, down 0.5 percentage points from previous forecasts. The World Bank slashed this fiscal year’s growth forecast by 0.7 percentage points to 3.5%.

The Cabinet approved the EGP30 billion initiative to support companies in priority industrial sectors during its weekly meeting last week. 

Egypt imported a record 981 mn cfd of natural gas from Israel last year, up 18.2% y-o-y, according to a report from industry publication Mees. 

Agricultural exports were up 15% y-o-y in 2024, increasing by 1.1 million tons on the year before to come in at 8.6 million tons, Agriculture Minister Alaa Farouk said.

Egypt's 5-year CDS rates slid down to 5.35% from 5.96% on 14 January on the declaration of Gaza ceasefire agreement, as, if maintained, it is expected to have positive effect on external finances, including Suez Canal revenues as well as tourism in Sinai.

The Ministry of Planning signed the terms of the executive agreement for the soft loan from Japan worth USD230 million to support the budget, empower the private sector, and diversify the economy.

French yeast producer Lesaffre Egypt will receive the golden license for its EUR120 million yeast production and packaging facility to be set up in Beheria.

Finnish food packaging manufacturer Huhtamaki secured the golden license for its EGP1.5 billion factory.

EGCH inked a seven-year agreement with Saudi capital-backed Al Sharq Real Investment, under which the latter will operate and maintain an electric arc furnace for silico-manganese alloys production. 

ABUK's BoD approved proceeding with the second phase of the company's solar energy project and starting the procedures for tendering the installation of new solar energy stations in several locations within the company with a capacity of 2.5 to 3 MWp.

The National Investment Bank is targeting to sell its 30% stake in Alamal Alsharif Plastics after listing the company's shares on EGX.

Oil and gas companies have drilled 105 wells over the past six months. These wells — 95 oil and 10 natural gas — have added 63.7k bpd of oil and 271 million cfd of natural gas to the country’s daily local energy production, which will help the state save some USD1.5 billion in oil imports. Prime Minister expects Egypt to get back to importing natural gas by 2027.

Chevron plans to invest USD150 million to drill a second exploratory well in the Mediterranean’s Nargis gas field next month. The company will get started on drilling the second well after completing and sealing the first well. Gas production is expected by late 2026.

EFID acquired 49% of Baghdad-based snack maker Tuama Jebur Abbas (TJA) for USD8 million through a capital increase. The acquisition includes a factory equipped with three production lines, two for cakes and one for biscuits. This marks EFID’s first entry into the Iraqi market, with plans to invest around USD27 million over the next three years.

Social Impact Capital’s acquisition of CIRA nears its close with 96.5% of targeted shares responding to the offer.

- Market Overview 
- BTFH
- SKPC
- ABUK
- EKHO



- prepared by: Mayada Amin- CETA, CFTe

Organi Group is going to increasingly focus on expanding its presence in the automotive and tourism sectors over the next five years and invest USD1 bn in the two sectors by 2030.

The Egyptian National Railways (ENR) has partnered with Italian rail construction and maintenance firm Salcef Group to form a new joint venture, Salcef Track, that will oversee the development, renewal, and maintenance of Egypt's railway infrastructure over the next 25 years.

ExxonMobil Corporation announced a new discovery of natural gas off the coast of Egypt in the Mediterranean Sea.

Katia & Bony, a Turkish textile firms whose parent company Bonysocks exports to global brands like H&M and Carrefour, will be launching sock manufacturing operations in Egypt with investments of USD50 mn.

 
Ahmed Ezz, the main shareholder in ESRS, submitted a request to appeal against the exclusion of his shares and the shares of related parties from voting on the general assembly’s decisions related to the delisting of the stock from EGX. The result of the complaint will be announced on 22 January 2025. ESRS decided to self-finance the markup in the delisting price from the previously offered price of EGP120.00/share and the IFA fair value of EGP138.15/share. 


FRA is currently studying a new regulatory framework that would govern fractional investments in the real estate sector, with the authority currently in talks with real estate developers interested in adopting the approach.

MASR signed a partnership with GTCI to construct energy and infrastructure projects worth more than EGP263 million in Taj City.

Hazem Helal has been appointed CEO of O West, Makadi Heights, and Byoum by ORHD.

- Market Overview 
- ABUK
- MFPC
- AMOC
- SKPC


- Prepared by: Mayada Amin- CETA, CFTe