Al Ahly Pharos

Market Overview 


Prepared by: Mayada Amin- CETA, CFTe

Imported mobile phones could be subject to customs and tax fees totaling 37.5%, as part of incoming government regulations to support the country’s mobile phone manufacturing localization efforts.

Prime Minister is gearing up to announce “positive news” regarding the airport privatization plan developed with the International Finance Corporation (IFC).

Infinity Power, UAE’s Masdar, and Hassan Allam Utilities will soon launch a tender for a contractor to carry out their combined 1.2 GW solar projects planned for the Dahkla Oasis and Benban plant in Upper Egypt.

The Ministry of Petroleum intends to launch an international bid for gold exploration in areas in the Eastern Desert.

The CBE balances at the International Monetary Fund rose to EGP31.172 billion at the end of October, compared to EGP18.243 billion at the end of September 2024.

The Egyptian government expects the World Bank to respond in 1Q25 to its request for new financing worth USD250 million in order to implement the state ownership policy.

Jade Textile Company, a subsidiary of the Turkish Yeshim Group in Egypt, is implementing investment expansions in its factories in Cairo, Ismailia, and Alexandria, with a total investment of USD180 million.

ORAS reported a steady set of results for 3Q24. Net income attributable to shareholders came in at USD21.6 million (+34% YoY, +12% QoQ) in 3Q24. This brought 9M24 bottom line to USD87.0 million, down 24% YoY. ORAS is currently trading at FY25e PE of 5.3x and EV/EBITDA of 1.2x.

United Bank private placement on the EGX will wrap up later today. The offering is reportedly already 3x oversubscribed with still one day left of the placement to go. Retail subscription is starting on Wednesday until 3 December.

The IFC inked an agreement with COMI that will see it grant the bank some USD150 million in soft financing aimed at supporting COMI’s efforts to promote micro and small and medium-sized enterprises.

BTFH's platform NEBIT aims to penetrate non-traditional fertilizer activities and agricultural supplements. 

Catalyst Partners Middle East (CPME) made its EGX debut yesterday. The SPAC listed 1 million shares with a nominal value of EGP10/share. 

JUFO BoD has initially approved the merge of Elmasreya for Dairy Products Company, Eldawleya Modern Food Industries Company, Egyptian Food Industries Company - EGYFOOD, and Al Marwa Food Industries Company into JUFO based on the book value of these companies according to FY23 financials.

Egypt's chemicals and fertilizers exports increased by 5% YoY to USD6.5 billion in 9M24. 

Weekly Commodities Update

 |   | Last Price | WoW Change, %
| Brent, USD/bbl | 75.2 | 5.80%
| Diesel-HSFO Spread, USD/ton | 260 | 9.20%
| Egypt Urea, USD/ton | 354 | 0.00%
| Polyethylene, USD/ton | 975 | -0.50%
| Polypropylene, USD/ton | 960 | -0.50%
| Iron Ore 65%, USD/ton | 121 | 2.70%
| Steel/Iron Ore Spreads, USD/ton | 389 | -4.00%
| LME Copper Cash Price, USD/ton | 8,848 | -0.40%
| LME Aluminum Cash Price, USD/ton | 2,597 | -1.20%
| Egyptia Retail Cement, EGP/ton | 2,849 | 0.00%
| Steam Coal FOB Newcastle Australia, USD/ton | 141 | -0.40%
| SMP, USD/MT | 2,882 | 1.10%
| Last price may vary week over week in some indices due to time difference

Market Overview 

prepared by: Mayada Amin- CETA, CFTe

 In line with our expectation, the CBE left interest rates unchanged after its MPC Committee met on Thursday. 

A coalition of Chinese companies has been established to develop a 1 million feddan integrated farming zone in the New Valley Governorate.  

Planning and International Cooperation Minister Rania Al Mashat met with a delegation from the European Union to discuss unlocking EUR1.8 billion in investment guarantees from the bloc.

The government is planning to slash customs clearance times to two days by 2025, Investment Minister Hassan El Khatib said.

The Senate will vote on a bill that aims to tighten restrictions on those aiming to join the importers registry, stipulating that those aiming to join the register should have a capital of at least EGP500k, and for limited liability companies to have a paid up capital of at least EGP2 million. 

A group of Saudi families intend to pump investments of USD150 million into the Egyptian market in the coming period, according to the head of Business City Group, an investment advisory company.

The Suez Canal Economic Zone (SCZone) signed a land usufruct agreement with ORAS subsidiary, Orascom Industrial Parks, for its already announced EGP13 billion integrated industrial complex planned for the Sokhna Industrial Zone. 

A consortium of international institutions is to provide some USD106 million in new funding to the Red Sea Wind Energy (RSWE) — a JV between ORAS, France’s Engie, and Japan’s Toyota Tsusho/Eurus Energy. 

PHDC and Marriott International signed an agreement to establish The Ritz-Carlton Residences. 

CCAP sent a release concerning an administrative seizure by the Egyptian Customs Authority on ERC for a total amount of EGP379 million representing tax differences and customs duties due for 15 customs declarations, in addition to additional added tax (VAT ). In conclusion, the negotiations between the Egyptian General Petroleum Corporation and the Customs Authority on 20 November 2024 successfully led to the Customs Authority lifting the administrative seizure.

A consortium of local banks is currently studying a USD100 million syndicated loan for the Egyptian Bioethanol Company (EBIOL) to build its bioethanol factory in Damietta with a capacity of 100k tons per year. We note that SKPC owns 7.5% of EBIOL.

We updated our FV of PHAR to EGP63.25/share and maintain Overweight.

PHAR’s USD100 million biopharma factory is set to launch operations in 1Q25, according to a Health Ministry statement. The factory aims to localize the production of biologics and biopharmaceuticals both in terms of their final products and as active ingredients.

HRHO’s commercial bank, Bank NXT, signed a cooperation protocol with the Urban Development Fund (UDF) to provide mortgage financing to individuals purchasing UDF units in governorates across the country. 

National Investment Bank (NIB) sold almost its full stake of 9.99% in MBSC in a deal worth EGP287.3 million. NIB sold 6.11 million shares at a price of EGP47.00/share.

A number of car agents are negotiating with El Nasr Automotive to use its production lines to locally assemble some of their models during the coming period. 

The contracts of beet sugar producing companies recorded an increase during the current season, supported by an increase in the cultivated area of beets by 16% since the start of the planting season last August until 10 November.

Market Overview 
CIEB
ADIB
FAIT
CSAG
FWRY


Prepared by: Mayada Amin- CETA, CFTe

The CBE's MPC is scheduled to meet today. We remind you that we expect the CBE to prefer to hold rates unchanged in today’s meeting due to persistent inflationary pressures, among other factors.

Senior private and public sector figures from Egypt and the UAE inked numerous investments:

Cabinet greenlit two power purchase agreements for two separate solar projects for a consortium made up of the UAE’s Masdar, Hassan Allam Utilities, and Infinity Power.

Cabinet approved a draft decision to establish a USD10 million private freezone for ready-made garments in Sadat City. 

Sources in the Ministry of Electricity revealed that USD3.5 billion are expected as investments in the renewable energy plant project located in Zaafrana.

Egypt’s fourth IMF review is set to wrap by tomorrow, with only procedural stages left before the Fund’s Executive Board formally greenlights the decision that will unlock USD1.3 billion in financing. 

Sources said that although the Suez Canal Authority’s contributions to the state coffers plummeted 92% y-o-y to EGP1.0 billion in the first quarter of FY24-25, the shortfall was partially offset by a 108% surge in revenues from special funds.

Turkish Investment group Erciyas Holding is looking to establish a USD60 million oil, natural gas, and water pipelines factory in Egypt.

Turkish clothing manufacturer Eroglu Holding has broken ground on its USD51 million garments factory in the Qantara West Industrial Zone.

The government is getting ready to launch the EGP115 billion second phase of the universal health insurance system in the next fiscal year.

Egypt may need to seek alternatives to Russian wheat, as Russian farmers are turning their backs against the grain, saying they will sow less wheat in favor of higher-margin crops like peas, lentils, and sunflowers, Reuters reports. 

HRHO 3Q24 net profit after tax and minority interest recorded EGP697 million (-12% q/q, +76% y/y), bringing 9M24 attributable bottom line to EGP3,309 million (+97% y/y). The company is currently trading at 7.7x P/E25 and 0.9x P/B25.

The coverage rate of the private offering of United Bank on the EGX reached 1.06 times yesterday, Wednesday, on the first day of opening the subscription door, which lasts for five days, while the public subscription starts on November 27 until December 3.

ValU Consumer Finance Company’s financing recorded EGP1 billion during the first half of November, which witnessed the White Friday offers, according to Walid Hassouna, the company’s CEO. 

CANA and Mint Real Estate Assets, a joint venture between Al Ahly Sabbour and the National Bank of Egypt, have set up a new real estate development company called Anchors for Real Estate Development. 

CCAP’s consolidated revenue grew 64% YoY to EGP38.2 billion in 2Q24 supported by solid performances across all subsidiaries. However, the Group’s net loss expanded by 255% YoY to EGP1.4 billion during the quarter as a result of an increase in non-operating expenses, including revaluation of Allied Corp and TAQA Arabia shares, as well as legal costs associated with the restructuring and settlement of bank debt.

ECAP released weak 3Q24 financial results, with net profit dropping to only EGP2.6 million (-96% YoY, -97% QoQ) on the back of a contraction in operating margins, a surge in net interest expense, along with a FX loss of EGP32.8 million. The stock is trading at FY25e P/E of 6.4x.

The European Bank for Reconstruction and Development (EBRD) is set to provide some USD21.3 million in new funding to the Red Sea Wind Energy (RSWE) — a JV between ORAS, France’s Engie, and Japan’s Toyota Tsusho/Eurus Energy. 

Market Overview 
EMFD
HELI
PHDC
TMGH
GGCC


prepared by: Mayada Amin - CETA, CFTe

United Bank will kick off its planned offering on the EGX today. The total offering could see the bank raise up to EGP5.1 bn by floating an equivalent to a 30% stake.

The number of tourists visiting Egypt increased during Jan - November 2024 by 4% compared to the same period last year.

Egypt's imports of fuel shipments increased to more than USD12.5 billion during 10M2025, compared to USD10.5 billion in the same period last year.

EGAS is negotiating long-term agreements to import LNG, moving away from reliance on global tenders. The move aims to secure gas supplies and protect Egypt from fluctuating spot market prices. Tenders will remain in use, but only for limited imports.

IFC wants to collaborate with the government on mining materials it thinks will aid local manufacturing. 

The government wants to replace 250k gasoline-fired car engines to ones that run on natural gas. The government will soon start converting its own fleet of vehicles to run on natural gas.

Al Dahra Egypt, a subsidiary of Emirati agribusiness Al Dahra, is planning on investing some USD 200 mn to add between 80k-90k feddans to its land portfolio over the next five years.

Abu Dhabi Tourism Investments Company, owned by the Abu Dhabi Fund for Development, is pumping new investments worth USD100 million to establish the Sofitel Legend Pyramids Hotel.

The House also greenlit a EUR 1.8 mn grant agreement to support people with disabilities, with Italy set to provide EUR 1.65 mn and the Social Solidarity Ministry providing EUR 181k.

We updated our FV for POUL to EGP21.29/share and maintain Overweight recommendation. The updated FV factors in:

1.         Adjusting revenues to new market prices.

2.         Normalized margins to average at 21.3% through the forecast period. 

3.         Strong cash position.

4.         New macro assumptions.

POUL is currently trading at 2025f P/E of 3.3x.

OIH is set to acquire Misr for Entertainment Investments with its non-executive expert directors and independent directors approving the acquisition in principle.

Credit rating agency Fitch Ratings has upgraded the credit ratings of four major Egyptian banks. The agency upgraded the ratings of the National Bank of Egypt, Banque Misr, COMI, and Banque du Caire to B from B- with a stable outlook.

Al Marakby Steel to invest EGP1.5 billion in the coming five years within the company's expansion plan and establishing a solar power station. 

Three Chinese companies had injected USD400 million of investments in the sanitary ware sector during the last few months.

Kempston, specializing in the production of SPC flooring, to launch the first phase of its new factory in Ain Sokhna in 1Q25 with a capacity of 1 million sqm per year. The second phase is planned to be operational by the end of 2025 doubling the capacity to 2 million sqm a year. 

Chinese state-owned auto manufacturer FAW Group is re-entering the Egyptian market in 1Q25 under a partnership with an unnamed new agent.

Chery International subsidiaries Omoda and Jaecoo are in talks to enter the Egyptian market through a partnership with an unnamed local agent. 

Market Overview 
AJWA
OIH
OFH
ENGC


prepared by: Mayada Amin- CETA, CFTe

 Hassan Allam Holding inked a memorandum of understanding with Abu Dhabi wealth fund ADQ portfolio company and Ras El Hekma project master developer Modon Holding, in an agreement to cooperate on projects in the “infrastructure, energy, and water and wastewater treatment, and special building” sectors, the companies said in a joint statement. 

The CBE payment platform Instapay will start accepting Egypt-bound remittances from Gulf nations before within two months, the bank’s deputy assistant governor for payment systems and services said. For the time being, transfers will be received in EGP, but opening this up to AED and SAR is being studied. 

The Oil Ministry is in talks with suppliers to postpone LNG shipments from 4Q 2024 to 1Q 2025, a government source said. The shipments are part of the 20 cargoes of LNG that the government bought for USD 907 mn to cover domestic needs between October and December.

The Readymade Garments Export Council is negotiating with foreign companies from China, Turkey, and Vietnam to establish factories in Egypt, some of which are based on the localization of imported industries. 

We raise our FV of SWDY to EGP75.00/share, up from the previous EGP45.69/share, yet we maintain our Equalweight recommendation given the recent price rally in the stock price. SWDY is trading at FY25e P/E of 10.2x and EV/EBITDA of 5.0x. 

DOMT reported 3Q24 results, showing a net profit of EGP166.9 million (+63.5% YoY, 90.2% QoQ), with NPM of 6.6% (+1.5pps, +2.3pps QoQ). DOMT is currently trading at 2025f P/E of 13.3x and EV/EBITDA of 7.7x

NTRA has given its preliminary approval to MNOs to increase prices of telecom services (phone calls and internet services) in Egypt.

Following HELI's Board approval in August to start procedures to acquire a 770 feddan land plot in Capital Gardens, HELI disclosed that the land plot area is 766 feddans worth EGP12.6 billion, 10% of which has been paid and the rest of which will be paid over six years.

Al Ahly Sabbour is looking to list around 20-25% of its shares on the EGX.

The indicative price range for the United Bank IPO, set between EGP 12.70 and EGP 15.60 per share, suggests significant upside potential within the sector, valuing the bank between EGP 13.97 billion and EGP 17.16 billion. This pricing translates to a projected 2025 P/B of 0.8x to 1.0x and a P/E of 4.7x to 5.8x. In contrast, the sector averages for 2025 stand at 0.8x P/B and 2.9x P/E, highlighting a notable discrepancy. 

HRHO announced that its private equity arm has launched a USD 300 million Saudi Education Fund (“SEF”) with the target of building an institutional world-class K-12 operator in the Kingdom of Saudi Arabia. 

BTFH is continuing to reap the benefits of its growth strategy during 9M24, with consolidated operating revenues increasing at 404% y/y to record EGP4.8 billion, while net profit exceeded EGP1.13 billion, up from 86 million pounds during the same period of the previous year. 

CNFN launches a new project in Zayed City with investments amounting to EGP1.5 billion.

State-owned El Nasr Automotive and the privately held Al Safy Group have set up a joint venture, dubbed SN Automotive, to assemble global car brands locally to sell in Egypt and export to other North African nations. 

Egypt’s car imports witnessed a significant decline of more than 28% in August 2024, amounting to USD156.09 million, compared to approximately USD217.09 million during the same month last year.