Al Ahly Pharos

The government will raise USD2 billion from its asset sale program within the next 1-2 months, through ETEL exiting its entire stake in Vodafone Egypt, or from the sale of the Beni Suef power station. The House of Representatives yesterday gave its final approval to the FY 2023-2024 fiscal budget, with an expected deficit of EGP849 billion (7% of GDP).  Prime Minister discussed potential incentive...

Market Overview  COMI EFID ORAS ABUK prepared by:Mayada Amin- CETA, CFTe

The US Federal Reserve is expected to keep its benchmark interest rate unchanged within the 5.0-5.25% range at its policy meeting this Tuesday and Wednesday.  Egypt’s core inflation rose to 40.3% y-o-y from 38.6% in April. We expect the MPC to leave rates unchanged at the June 22 MPC meeting.  The government is targeting oil and gas exports of USD 21 bn in 2023, up 15% YoY and another c.15% increa...

Market overview  FWRY ORWE ORAS ESRS PHDC ASCM prepared by: Mayada Amin - CETA, CFTe

According to IMF Deputy Managing Director Antoinette Sayeh, the Fund expects to see the government achieve concrete results that will work to restore confidence in its economic reform package over the course of the next several weeks.  Private equity firm Actis and Malaysian power company Edra have renewed their interest in acquiring one of the three Siemens-built power plants for USD2 billion. Th...

Market Overview  COMI AMOC SWDY EFIH EFIC prepared by: Mayada Amin - CETA, CFTe

IMF deputy managing director will visit Cairo in the coming days to meet with Egyptian officials regarding the government’s economic reform program.  Annual urban inflation figures for May should be released this morning (after the release of this publication) and consensus estimates are pointing at 31.4% YoY, up from 30.6% in April. The Ministry of Finance and the National Investment Bank are pre...

Market Overview  Prepared by: Mayada Amin - CETA, CFTe

*Key news articles for today* The World Bank has downgraded its Egypt growth outlook in FY23/24 to 4.0%, down 0.8% from its last forecast in January.  Net foreign reserves inched up to USD34.66 billion in May from USD34.55 billion in April.  The Minister of Finance said that the government is committed to reducing debt to less than 80% of the GDP by FY26/27.  The budget deficit increased to 5.55%...

Market Overview  EFIH CCAP ISPH ACGC ETEL  Prepared by: Mayada Amin - CETA, CFTe

Pitch| End of 1Q23 Results Season; TMGH Reconfirmed as Our Sector Top Pick. Highest y/y growth in 1Q23 sales (up 127.2% y/y to EGP12.2 billion). Our FV of EGP19.67/share implies a valuation gap of 109.3% which is the widest valuation gap in the sector. Our FV of EGP19.67/share is mainly supported by residential projects contributing EGP8.36/share and non-residential projects contributing EGP10.02/...

Market Overview  Prepared by: Mayada Amin- CETA, CFTe

Egypt’s PMI rose from 47.3 in April to 47.8 in May, the highest level since February 2022.  Egypt targets increasing oil production by 11% to 650k bbl/day during 2023, with investments of foreign oil companies at USD 7.75 billion, +35% YoY.  The government is in talks with strategic investors to sell a 49% stake in the Egyptian Drilling Company (EDC), aiming to complete the sale before the end of...

Market Overview 

NBE and BM are studying a proposal to offer USD certificates of deposit  with 17% interest rate, with the equivalent value of interest being paid in Egyptian pounds, and another with a return of up to 10%, with interest being paid in US Dollars, while  limiting the right to subscribe to Egyptians with dual nationalities, or those working abroad, or foreigners. Barclays is lining up a June promotio...

Market Overview 

President Abdel Fattah El Sisi received a phone call from IMF Managing Director yesterday, discussing the government’s economic reform program.   New rules making it easier for foreigners to get citizenship were signed into law by El Sisi, including the purchase of real estate units for a value of USD350k. TMGH is a key beneficiary.    The cabinet approved a recent decision by the Interior Ministr...

Market Overview  Prepared by: Mayada Amin- CETA, CFTe

JUFO (FV: EGP14.00, OW) released 1Q23 bottom line of EGP339 mn (+134.9% YoY, +107%, QoQ), backed by enhanced gross profitability, cost-cutting measures, and exports, despite the heightened interest expenses and FX losses. Price increases did not compensate for volumes drop. JUFO is trading at a FY23 P/E of 11.1x and an EV/EBITDA of 6.1x. EAST (FV: EGP24.72, OW) released 3Q22/23 bottom line of EGP1...

Market Overview  COMI HRHO ESRS AMOC Prepared by: Mayada Amin - CETA, CFTe

MPs gave their final approval yesterday to a fresh batch of tax amendments — to add EGP 1.2 billion to state revenues. The bill will be passed to the President to sign into law.  Investors will be charged the 10% capital gains tax on only 50% of the realized gains made from selling shares in newly-listed companies. This will fall to 25% two years after the passage of the legislation.  Income made...

Market Overview  SKPC ESRS ADIB ACAMD  DSCW ORHD Prepared by: Mayada Amin - CETA, CFTe

*Key news articles for today*   The Ministry of trade and industry is studying a package of incentives for the industrial sector.   The Parliament gave preliminary approval to legislative amendments including tax and development fee hikes.   Moody’s expects growth to slow in most emerging markets this year.   The IFC could lend USD260 million to state-owned Banque Misr for on-lending to local MSME...

The Ministry of trade and industry is studying a package of incentives for the industrial sector.   The Parliament gave preliminary approval to legislative amendments including tax and development fee hikes.   Moody’s expects growth to slow in most emerging markets this year.   The IFC could lend USD260 million to state-owned Banque Misr for on-lending to local MSMEs and women-owned SMEs.   TMGH a...

The Ministry of trade and industry is studying a package of incentives for the industrial sector.   The Parliament gave preliminary approval to legislative amendments including tax and development fee hikes.   Moody’s expects growth to slow in most emerging markets this year.   The IFC could lend USD260 million to state-owned Banque Misr for on-lending to local MSMEs and women-owned SMEs.   TMGH a...