Pre-Trading Thoughts

Al Ahly Pharos

The CBE has increased cash withdrawal limits from EGP150k to EGP250k per day from banks, and from EGP20k to EGP30k per day from ATMs.

World Bank expects Egypt's GDP growth to decline to 2.8% in FY2023/24 from 3.8% in FY2022/23, 0.7 percentage point drop from its previous forecast in January, exacerbated by the repercussions of the Middle East conflict on Suez Canal and tourism. Growth is expected to record 4.2% in FY2024/25.

The Renewable Energy Authority and the Sovereign Fund of Egypt are planning to open up bidding for the second half of the Zafarana wind farm in the latter half of the year.

The government unveiled its plans to build two solar power plants for EGPC worth over EGP1 billion, to be financed by a grant from the EU.

Egypt's fuel imports increased to USD3.3 billion during 1Q24, an increase of 6% compared to the corresponding quarter of last year.

ESRS (FV: EGP97.02, OW) reported its 4Q23 and FY23 consolidated financial results with solid operational performance. Net attributable income came in at EGP1.0 billion in 4Q23, 82% higher YoY, and reversing 3Q23 loss of EGP508.8 million. This brings FY23 attributable loss to EGP113.0 million vs. a net profit of EGP4.3 billion in FY22. ESRS is currently trading at FY24e P/E of 1.4x.

ESRS’s Board of Directors is holding an extraordinary general assembly to consider reducing the company’s capital through retiring treasury shares worth EGP910.5 million.

Qalaa Holdings (CCAP) has signed a debt settlement agreement with Banque Misr, Banque du Caire, Arab African International Bank, and Al Ahli Bank of Kuwait whereby Qalaa settles the entirety of its debts for a total of EGP4.547 billion as follows:

1. Selling 239.1 million shares, representing 17.68% of TAQA Arabia, with Qalaa retaining the right to repurchase those shares within five years, and the banks having the right to resell those shares to Qalaa in the sixth year.

2. A registered 60,127 sqm land plot overlooking the Nile in Tibeen area.

3. Compensations for variations in exchange rate and stock prices.

MOPCO clarified that the merged company net profit on 31 December 2023 was EGP3.59 billion, and the net profit of the merging company was EGP5.97 billion in the same period. It added that the merged company net profit was reported in the equity section of the merging company financial statement in FY23.

Local free market urea prices increased from EGP16k to EGP20k per ton during the last month with the start of the summer cultivation season.

Petrotreatment is planning to float its shares on EGX during the coming period.

HELI (FV: EGP18.84, OW) expects to complete its financial assessment of the three offers it received from Hyde Park Developments, MASR (FV: EGP5.24, OW), and Mountain View to co-develop 500 feddans in New Heliopolis before the end of April 2024 in preparation for selecting an offer.

DOMT shareholders approved cash dividend distribution of EGP0.50/share to be distributed in May 2024. This implies a dividend payout of 31% and dividend yield of 4.2%.

Weekly Commodities Update
|Last Price | WoW Change, %
Brent, USD/bbl | 90.5 | -0.8%
Diesel-HSFO Spread, USD/ton | 363.1 | -5.3%
Egypt Urea, USD/ton | 328.0 | 0.0%
Polyethylene, USD/ton | 1,030.0 | 0.0%
Polypropylene, USD/ton | 970.0 | 0.0%
Steel/Iron Ore Spreads, USD/ton | 394.1 | -3.3%
LME Aluminum Cash Price, USD/ton | 2,448.1 | 1.5%
Egyptia Retail Cement, EGP/ton | 2,095.0 | -0.1%
Steam Coal FOB Newcastle Australia, USD/ton | 129.3 | 0.1%
SMP, USD/MT | 2,550.0 | 0.0%
Last price may vary week over week in some indices due to time difference