Pre-Trading Thoughts

Al Ahly Pharos

Cabinet spokesperson named banking, airports, pharma, plastics, glass, and petrochemicals as among the sectors where we will see stakes in state-owned entities offered up by the end of June. In addition, there are another 15 stake offerings in the pipeline after the current fiscal year.

The Private Sector Partnership Unit in the Ministry of Finance intends to launch six projects through PPP, during 1Q25.

The government decided to transfer a number of renewable energy projects that will produce green hydrogen from areas in the east and west of the Nile to three new sites near the Suez Canal Economic Zone, for cost-related reasons.

The British company United Oil and Gas announced the completion of the legal procedures related to its exit from the 22% stake in Abu Sinan concession in Egypt.

The Ministry of Communications aims to reach USD9 billion in outsourcing industry exports by the end of 2026, up from USD3.7 billion currently.

The Tax Authority has canceled the imposition of VAT on services provided by commercial agents and legal representatives of foreign companies and branches of foreign companies operating in Egypt, such as marketing and promotion.

MPs are back in the House again today to resume discussions over draft laws that pertain to refugees, the newly amended Criminal Procedures Law, and urban development plans.

TMGH (FV: EGP75.00, OW) achieved strong 3Q24 results. Net profit in 3Q24 increased 118.9% y/y and 64.1% q/q to EGP2.5 billion, taking 9M24 net profit up 136.5% y/y to EGP6.3 billion.

PHDC (FV: EGP8.78, OW) achieved stellar 3Q24 results. Net profit in 3Q24 reached EGP648.9 million, up 47.0% y/y and down 7.5% q/q, taking 9M24 net profit up 124.2% y/y to EGP2.4 billion.

EMFD’s net profit in 3Q24 increased 80.0% y/y and 41.0% q/q to EGP2.7 billion, bringing 9M24 net profit up 107.4% y/y to EGP10.3 billion.

EMFD’s Board approved the IFA report valuing EMFD at EGP10.71/share and Albro North Coast for Developments at EGP14.55/share, with an equity swap ratio of 1.359 shares in the increased capital of EMFD for each share in the capital of Albro North Coast for Developments. This will result in a total issuance of 917.6 million shares in the increased capital of EMFD in exchange for acquiring 675.0 million shares in the capital of Albro North Coast for Developments.

We upgraded our FV for JUFO to EGP52.53/share, reiterating our Overweight recommendation. JUFO is currently trading at 2025f P/E of 8.9x and EV/EBITDA of 5.7x.

ORWE reported 3Q24 financial results. Net profit of EGP701 million (+8.0% YoY, -23.4% QoQ). This brought 9M24 bottom line to EGP2,173 million (+57.2% YoY). ORWE is currently trading at 2025f P/E of 5.8x and EV/EBITDA of 5.3x.

EKHO released 3Q24 consolidated financial results. Net profit dropped 5% YoY (+24% QoQ) to USD34 million. In 9M24, net profit declined 9% YoY to USD124 million EKHO is currently trading on 2025f PE of 7.2x and EV/EBITDA of 3.9x.

CNFN’s 3Q24 consolidated bottom line expanded to EGP235 million (+24% y/y, +79% q/q). 9M24 net profit recorded EGP410 million (-6%y/y).

ValU raised EGP667.3 million in a securitized bond issuance.

MNT Halan is considering listing on the EGX in 12-24 months.

ARCC's Board proposed a cash dividend distribution of EGP1.585/share for FY23, pending general assembly approval. This implies a payout ratio of 86% and a dividend yield of 11%.

RAYA recorded net profit of EGP1.3 billion in 9M24 (+160% YoY).

RAYA has tapped Attijariwafa Bank as its financial advisor and Baker McKenzie as its legal counsel for the transaction that will see Africa-focused and London-based PE outfit Helios Investment Partners acquire 49% of subsidiary Raya Foods.

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