Pre-Trading Thoughts

The Egyptian Stock Exchange is conducting a joint study with the GAFI to expand investment and tax incentives for listing and offering companies on the EGX.

The Egyptian 5-year CDS rate fell during Tuesday’s trading to 5.9%, compared to 6.365% in last Monday.

The Suez Canal Economic Zone wants to set up a USD60 mn data center with a capacity of 5-7 MW in partnership with the private sector. 

A government source said that it remains unclear whether or not the blackouts will be returning as the Egyptian Electricity Holding Company is yet to receive a decision from the cabinet. The source pointed to a notable dip in energy consumption, and the government securing the needed LNG supplies to keep the lights on.

Private equity firm SPE Capital plans to allocate 25-33% of its USD 350 mn SPE PEF III to Egyptian investments. The company plans to acquire stakes in 2-3 local companies, with an eye on export industries, financial services, and logistics. The fund should reach second close before the end of the year.

Al Arabiya platform said that Egypt has formed an advisory council for economic development.

Egypt's non-petroleum merchandise exports recorded about USD26.229 billion during the first eight months of the current year, an increase of USD2 billion, compared to the same period last year.

The government has began taking the necessary steps to offer additional shares of EGCH (Kima) and EGAL on the EGX. The government announced a study to offer Delta Fertilizers shares on EGX. 

We updated our FV of CLHO to EGP9.00/share and maintained our OW recommendation. CLHO is currently trading at FY24 P/E of 13.2x.

The EBRD is considering providing a EUR25 million guarantee to QNBE, with the aim of supporting its loan portfolio for SMEs, which is scheduled to be approved on October 22.

An investment consortium that includes several companies, financial institutions, and banks, most notably Redcon Properties and SAUD, plans to establish a real estate investment fund in Egypt with an initial size exceeding one billion Egyptian pounds.

RAYA’s Aman Consumer Finance issued EGP1.29 bn in securitized bonds.