FAB withdrew VTO on HRHO

EAST declared to participate in the capital of the United Tobacco Company with 24% of the company’s capital amounting to EGP100 mn. United Company will solely bear the total cost of the value of the new license, without EAST bearing any costs in this regard. United Company will lease the building and the current production lines dedicated to the production of Phillip Morris products for a period of 3 years, with the leasing amount yet to be declared.  Phillip Morris products contribute 85-90% to the total toll manufacturing volumes for EAST. EAST is currently trading at a FY21/22 P/E of 5.1x and an EV/EBITDA of 3.7x.

 JUFO is working on revising prices based on the increase in production costs, both in terms of packaging materials, raw materials, and dairy prices, which rose from EGP8-11/kg. Raising prices will happen gradually to protect purchasing power and sales volumes. 

The government will offer nineteen water desalination projects with a combined production capacity of 3.3 mn cubic meters/day for the private sector to bid on soon. The combined investment outlay on the plants is EGP 72 bn. 

Prime Minister asked Competition Authority to prepare a study on steel and cement fair prices, in light of the recent increases and the government is eyeing more support for contractors to maintain project completion timelines.

The Commissioners’ Authority report on EGTS’s case regarding the 20.0 million sqm third phase Sahl Hasheesh land plot is scheduled to be reviewed on 21 May 2022.

Hotel occupancy rates in Hurghada are stable, ranging between 50%-55% during the first half of April 2022, compared to weak occupancy in Sharm El Sheikh. Sources expect hotel occupancy rate in Hurghada to exceed 60% by the end of April 2022 and reach at least 75% during July and August 2022.

EgyptAir is running flights between Cairo and Benghazi starting 18 April 2022.

The Consumer Protection Agency issued a decision obligating car dealerships and suppliers to set the final selling price of passenger cars to the consumer, within 20 days maximum. 

EGAS and Eni signed a framework agreement that will allow maximizing gas production and LNG exports from Egypt to Europe, specifically to Italy, with total volumes of up to 3 billion cubic meters in 2022.

In the latest tender, Egypt purchased 350,000 tons of wheat at about USD450 per ton, including French, Bulgarian, and Russian shipments.

The fiscal budget draft under discussion in the House of Representatives shows that the interest payments in FY2022/23 are projected at EGP690.1 billion (34.4% of total expenditure, which amounts to EGP2.07 trillion). The projected salaries and compensations amount to EGP400 billion.

The trade deficit declined 32.3% YoY during January 2022, recording USD2.44 billion. Exports increased by 34.5% recording USD3.99 billion.

Egypt is targeting natural gas household installations of 1.2 million in FY21/22, with 300k in 4Q21/22, to save butane gas subsidies which cost the state budget EGP17 bn per annum.