Al Ahly Pharos

- Market Overview - COMI - FAIT - EXPA Prepared by: Mayada Amin - CETA, CFTe

Net international reserves increased by about USD60 million, recording USD40.91 billion by end of November The latest set of conditions for the new license to manufacture cigarettes was published yesterday; Higher competition for EAST might exist for Cleopatra brand; EAST is allowed to own 24% of new company  CBE, Finance Ministry, and Egyptian Banks Company signed an agreement with MTS (EFIH owns...

- Market Overview - EMFD - ESRS - SWDY - CLHO - MNHD - EAST - EXPA - Prepared by: Mayada Amin - CETA, CFTe

Inflation expectations for November: Expect urban annual inflation to cool down to 5.7%, benefiting from a favorable base effect and a slower increase in the prices of some food items The state budget recorded a primary deficit of EGP4 billion in 1QFY2021/22 The Sovereign Fund of Egypt will participate in 3-4 green hydrogen production projects in 2022 The House of Representatives Industry Committe...

- Market Overview - AMOC - MNHD - TMGH - CLHO - EMFD - PHDC - ESRS - ATLC  - Prepared by: Mayada Amin - CETA, CFTe

Themes in Focus and Key Beneficiaries in 2022: Highest recovery in 2022 YoY earnings (ABUK), Inflation pick-up relative to last two years (COMI), Interest rates might rise (EMFD), Exchange rate might face pressure (ABUK), Water, transportation, electricity infrastructure spending, Reconstruction of neighboring countries (ORAS, SWDY), Digital transformation in Egypt (EFIH, FWRY), Tourism rebound (O...

- Market Overview  - COMI  - TMGH - HELI  - CLHO - EAST - Prepared by: Mayada Amin - CETA, CFTe

We Are Facing the Widest Gap Between Fundamentals and Market Performance Since 2011; Aggregated earnings of listed companies have significantly picked up in 2021 (+75% YoY) with additional 15-20% in 2022; Market had failed to reflect the recovery in earnings showing quite a wide gap relative to earnings’ performance, that should narrow down over time Oil Ministry hiked butane gas cylinder prices b...

- Market Overview - ABUK - AMOC - EAST - ETEL - PHDC - RACC -Prepared by: Mayada Amin- CETA, CFTe

Macro Backdrop for 2022| Growth will gradually recover to 5.5% in FY2021/22; inflation rate to record 6.9% in FY21/22; CBE might raise rates for a total of 100 bps-150 bps in 2022 and 2023; EGP broadly stable, with mild depreciation; CA deficit will shrink in FY2021/22 to USD12.5 billion; fiscal deficit declining to around 7% of GDP in FY2021/22 with 1.5% primary surplus; government debt to declin...

- Market overview  - COMI - ESRS - EGTS - TMGH - HRHO - SWDY - ISPH - HELI prepared by: Mayada Amin- CETA, CFTe

EGX30 is trading at a weighted average P/E of 7.8x for 2021, equivalent to its lowest reading since January 2016; The market is trading at a forward 2022 P/E of 6.1x, while earnings are expected to grow at aggregated 20% in 2022, after surging 75% in 2021 Fed Chairman said that the tapering of monthly bond purchasing could wrap up “a few months sooner” than anticipated; Would open the door to inte...

- Market Overview - COMI - MCQE - EGTS - EMFD - Prepared by: Mayada Amin - CETA, CFTe

Please check our earnings expectations excel for companies under coverage in 4Q2021/2021/2022 to know about companies that will enjoy the highest earnings growth in 2022 and lowest P/E multiples for 2022 OCDI board approved Aldar MTO; IFA values OCDI at EGP23.42/share; 29.1% of shareholders have decided to sell in the MTO until yesterday The government intends to offer a 10-15% stake for sale in A...

- Market Overview - COMI - HELI - MNHD - RMDA - TMGH -Prepared by: Mayada Amin - CETA, CFTe

We issued this morning our equity strategy for 2022, titled "Weathering Global Dynamics" Omicron is leading global front pages CBE will repay ST external debt obligations of USD18.9 billion in FY21/22 Emirati deposits with a total value of USD5.7 billion dollars have been extended over tranches to mature over 2022-2026 Petroleum, iron, and steel led Egyptian exports in 9M2021 to reach US...

- Market Overview - COMI - ISPH - EGTS - PHDC - RMDA - Prepared by: Mayada Amin - CETA, CFTe

Oil prices plunged more than 10% as reports of a new coronavirus variant sparked fears of more lockdowns and another blow to fuel demand; Brent futures are trading at USD72.72/bbl ESRS has finalized acquiring an c.18% stake in Egyptian Steel, for a value of EGP1.5 billion, to be fully paid in cash without including a share swap; Equity value per ton is EGP6,940/ton (assuming 1.2mn tons sales volum...

- Market Overview - COMI - HELI - ISPH - ORHD - ISMA Prepared by: Mayada Amin - CETA, CFTe

Egypt's economy grew by 9.8% in 1QFY2021/22, due to base effect and tourism recovery Egypt is developing a medium-term revenue strategy to increase tax revenues by 2% of GDP in four years Future Flow transactions/securitization will be introduced in Egypt, which allows companies to sell securities backed by future income Valu (HRHO) is preparing to penetrate new markets, led by Saudi Arabia;...

- Market Overview  - COMI - ETEL - ORHD - JUFO  - ISMA - Prepared by: Mayada Amin - CETA, CFTe

The MTO on OCDI is open from 24 November 2021 to 7 December 2021 EGTS reported 3Q21 net profit of EGP7.9 million, compared to 3Q20 net loss of EGP3.2 million and 2Q21 net loss of EGP6.2 million The New Urban Communities Authority is planning to issue next month 14 land plots for co-development, with land plot areas ranging from 50 feddans to 500 feddans in West and East Cairo  Airlines are getting...

- Market Overview - COMI - JUFO - HELI - MNHD - PHDC - RMDA - Prepared by: Mayada Amin- CETA, CFTe 

FRA has approved the MTO by Aldar to acquire up to 90.0% of OCDI at a price of EGP20.00/share. We calculate the values of other real estate stocks implied by this EGP20.00/share MTO price (land value of EGP627/sqm): EGP17.68/share for TMGH, EGP18.71/share for ORHD, EGP5.07/share for PHDC, EGP4.31/share for EMFD, EGP2.44/share for MNHD, EGP9.49/share for HELI, and EGP2.79/share for EGTS ZMID signed...

- Market Overview - COMI - HRHO - TMGH - ABUK - MFPC - Prepared by: Mayada Amin - CETA, CFTe