Pitch: ADIB| The Rising Star; Upgrade FV to EGP 28.50/share. The bank is currently trading at 0.9x P/B23 and 5.0x P/E23 on net profit post minority and appropriations of EGP 2.2 billion (growth of 24% y/y). Our FV is EGP 28.50/share on 500 million shares, post the conclusion of the final round of capital increase. The stock is the second most liquid in the sector after COMI and joined EGX30. We see a solid potential in the bank with bottom line 5-year CAGR of 21%, and an average RoAE of 19% over 2023-2027.
Pitch: AMOC| Not Reflecting EGP30/USD or Current Spreads; Upgrade FV to EGP10.80. The local currency depreciation is expected to offset the normalization in petroleum products prices. Diesel-fuel oil spread is currently at its highest since 2010/2011. We forecast AMOC to post net profits of EGP2,507 million, marking a 110% YoY growth in FY22/23. We expect the company to pay out 70% of FY22/23 net profit, which translates into EGP1.24/share, or a 16% dividend yield. AMOC is currently trading at FY22/23e P/E of 4.4x and EV/EBITDA of 2.8x.
National Bank of Egypt, Banque Misr, and Banque du Caire will suspend the one-year, 25% certificates of deposit by the end of the day today.
Suez Canal revenues rose 46% y-o-y in January to USD 717 mn. Some 1.95k ships transited the canal this month, up 21% y-o-y. Net tonnage rose 16% y-o-y to 110.6 mn tons.
Prime Minister noted that subsidized loans cost the government EGP 10 bn.
The government is spending EGP 6 bn a year to subsidize electricity prices for the industrial sector.
El Sisi held talks with several Indian firms to draw investments in Egypt’s green infrastructure, including renewable and green hydrogen.
EGX30 February Rebalancing: ADIB, EFID, and TALM replaced ALCN, HDBK, and QNBA.
Negotiations on pricing and final stake for QIA’s acquisition deal on Vodafone Egypt are still ongoing and have to be concluded before the final official offer submission, according to local press.
CICH (FV: EGP8.00, OW) is studying a new investment opportunity in the NBFS sector, through establishment or acquisition.