Pre-Trading Thoughts

Al Ahly Pharos

The CBE's MPC will hold its meeting on Thursday, 21 September, to decide on interest rates. We expect the CBE might prefer to keep rates unchanged for the time being, as inflation rates are showing quiet signs of moderation, and to avoid adding burdens on the budget.

Deputy Chair of the House Planning and Budget Committee denied giving comments to the media, which reported yesterday that the IMF’s anticipated review of our loan program could be delayed to 1Q 2024.

The new social support measures announced by Egyptian President Abdel-Fattah El-Sisi will cost an estimated EGP60 billion annually, according to Minister of Finance. The new package will go into effect on 1 October.

CEO of the General Investment Authority revealed that Egypt aims to attract net FDI inflows worth USD10 billion by the end of the current fiscal year (2023/24), noting that net foreign inflows recorded about USD7.6 billion at the end of last March, compared to USD7.3 billion in the corresponding period a year before.

The government is planning on selling 20-25% of its stake in Delta Sugar. Abu Dhabi Development Holding is showing interest in that stake.

The government plans to sell an additional 15% of its stake in Mopco to Abu Dhabi Developmental Holding Company.

According to local media, CCAP aims to list a number of its assets on the EGX as done with Taqa Arabia, in order to settle part of its debt to creditors.

The BoD of Paint and Chemical Industries (Pachin), now owned by Dubai-based National Paints Holding, approved plans to voluntarily delist its shares from the EGX. The company offered to buy back the shares from objecting shareholders for EGP39.80/share.

MOIL issued results for 1H23. Net profit amounted to USD17.7 million compared to a net loss of USD15.93 million in the same period last year. Top line came in at USD86 million compared to USD46 million in the same period last year.

EFIH’s (FV: EGP23.50, OW) BoD proposed distributing a cash dividend of EGP0.177 per share for 1H23. This translates to a dividend yield of 1.0%.

The Sovereign Fund of Egypt is preparing to offer a stake in Misr Technology Services (MTS) to investors by 1H24. EFIH owns 10% of MTS.

IRAX announced that the OPR specials operations market will be opened to buy back the shares from objecting shareholders for EGP1,250/share during the period from 19 September 2023 till 25 September 2023.

valU has issued EGP922.3 million worth of securitized bonds.

The CBE has revealed that the NPL ratio over the Egyptian banking sector declined to stand at 3.3% as of Jun-23 compared to 3.5% as of Mar-23, while provisions coverage recorded 91.1% compared to 93.3% over the same comparison period.

Nile Air is launching direct flights from Cairo to Cologne starting October 2023, running two flights a week.

Weekly commodities update

| Chems & Petchems | | Last Price | WoW Change, %
| Brent, USD/bbl | 93.9 | 3.6%
| Diesel-HSFO Spread, USD/ton | 467.0 | 3.5%
| Egypt Urea, USD/ton | 455.0 | 2.2%
| Polyethylene, USD/ton | 1,070.0 | 0.0%
| Polypropylene, USD/ton | 947.5 | 0.6%
| Steel/Iron Ore Spreads, USD/ton | 362.1 | -1.0%
| LME Aluminum Cash Price, USD/ton | 2,147.5 | 0.2%
| Egyptian Retail Cement, EGP/ton | 2,015.0 | 0.0%
| Steam Coal FOB Newcastle Australia, USD/ton | 160.5 | 2.7%
| SMP, USD/MT | 2,286.0 | -2.0%