Pre-Trading Thoughts

Al Ahly Pharos

Egypt and Italy agreed to kick off negotiations for the fourth phase of their debt swap arrangement.

The government intends to invest EGP8 billion to establish six strategic stores for medicines and medical supplies, with construction operations to be completed during the next year.

The government intends to renew the initiative to exempt gold from customs until the end of next June.

The Chairman of the Plan and Budget Committee in the House of Representatives stated that Egypt will pay another USD1.2 billion in dues to foreign oil companies within two weeks.

Companies planning mergers and acquisitions will need to secure the Egyptian Competition Authority’s (ECA) approval before proceeding starting 1 June 2024.

Local bus service GoBus plans to list 30% of its shares on the EGX within the next two years.

MASR (FV: EGP5.24, OW) reported 1Q24 financial results. Net profit in 1Q24 grew 287.3% y/y and 51.9% q/q to EGP1.2 billion.

HELI (FV: EGP18.84, OW) AGM approved the distribution of EGP1.34/share cash dividends (DY of 12.8%) within a month.

According to local media, MASR (FV: EGP5.24, OW) and HELI (FV: EGP18.84, OW) plan to launch their 491 feddan co-development project in New Heliopolis before the end of FY24.

We updated our FV for EGAL to EGP125.21/share maintaining our Overweight recommendation. EGAL is currently trading at FY23/24e P/E of 5.3x and EV/EBITDA of 3.5x.

LCSW reported solid 1Q24 consolidated results. Net attributable income surged to EGP477.5 million (+436% YoY, +331% QoQ). LCSW is currently trading at FY24e PE of 2.8x and EV/EBITDA of 2.3x.

We raised our FV for DOMT to EGP15.27/share from EGP13.42/share and upgrade our recommendation from Equalweight to Overweight.

OLFI reported 1Q24 financial results. Attributable net profit of EGP157 million (+36.4% YoY, -3.6% QoQ). OLFI is currently trading at 2024f P/E of 5.6x and EV/EBITDA of 2.2x.

CLHO reported 1Q24 financial results where net attributable profit stood at EGP182 million in 1Q24 (+92.6% YoY, +70% QoQ). CLHO is currently trading at 2024f P/E of 14.7x and EV/EBITDA of 7.7x.

BTFH recorded impressive 1Q24 results. 1Q24 net income recorded EGP514 million compared to a net loss of EGP52 million in 1Q23.

Asset management companies seeking to utilize robo-advisors will need to have a minimum capital of EGP15 million to obtain the required license.

SWDY sent a release to EGX clarifying that the contractual procedures of electromechanical works for the high-speed electric train stations between the cities of Ain Sokhna and Marsa Matrouh are being completed to reach a fully activated contract with the receipt of the sites along with the receipt of the advance payment after providing bank guarantees.

ABUK announced that it has successfully completed the overhaul activities of Abu Qir 1 plant on 25 May 2024.

KIMA sent a release concerning the subscription of the old shareholders in the company's capital increase. The company announced that 796.6 million shares have been subscribed to with coverage rate of 99.58%.

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