Pre-Trading Thoughts

"It is not called GB Auto; It is called GB Capital" The valuation range for GB Capital is EGP6.00-EGP7.50/share, which is c.4x the auto segment; The auto segment is worth EGP1.80, representing c.20-23% of the total stock value; The potential transaction on MNT-Halan should remind the market of such valuation and how discounted the stock is

With Diesel-HFSO spreads at more than USD330, refining margins for ERC will cross the 25% mark, which will lead to massive shrinkage in losses in 1Q2022; Another catalyst would be ERC reaching a debt restructuring agreement with banks, ERC's valuation upgrade would lead CCAP's FV increase to EGP2.00

MCRO’s IPO is priced at EGP4.85/share and the institutional offering was 1.79x oversubscribed. Stock should be trading at 2022f P/E of 14.9x, EV/EBITDA of 10.0x, and P/S of 3.9x 

Cabinet revised downwards the price of PCR test for both Egyptians and foreigners to stand at EGP650 and EGP750, down from EGP900 and EGP1200 (Negative for IDHC and SPMD)

HRHO's subsidiaries PayTabs and valU have partnered with X2C online auction and e-commerce platform Mazadat 

HRHO’s subsidiary Corp Solutions is negotiating to borrow EGP2.0 billion, where its financing portfolio currently stands at EGP10 billion; HRHO is trading at 9.4x 2022 P/E and 0.9x P/B

NBK Egypt shareholders sold 20.7 mn shares at EGP 20 per share, Implied multiples are 7.2x PE 2021e and 1.0x PB 2021e, which are higher than those of most listed banks

FRA scrapped a requirement for credit rating agencies to be at least 10% owned by international firms 

State-backed Lighthouse Education is looking to invest EGP560 mn in acquiring two new schools in Cairo 

Around 13k dual-fuel cars have been delivered as part of the natgas transition scheme as of the end of January 2022

Balance of Payments (BoP) performance for 1Q2021/22 shows gradual improvement in USD sustainable sources

The government wants to sell shares in up to ten state-owned companies on the EGX this year

The government is studying a new initiative for immediate cash payment to support exporters 

Oil exports jumped by 84.3% YoY in 2021 recording USD12.9 billion; Exports of LNG also surged by 550% YoY to reach USD3.9 billion

Africa Finance Corporation (AFC) is looking to partially finance Egypt's monorail and high-speed train projects with USD 250 mn