Pre-Trading Thoughts

The Madbouly government is aiming to transfer the administration of all state-owned companies to the Sovereign Fund of Egypt (SFE) in order to boost their returns, Investment Minister Hassan El Khatib said.Finance Minister Ahmed Kouchouk shared the details of the government’s social protection package of wage and pension hikes and support to Egypt’s most vulnerable. Some measures will take effect starting the new fiscal year in July and others will be implemented between March and July.The International Finance Corporation (IFC) is expected to reach an agreement with the Egyptian government on its privatization plan for the management of 11 airports by mid-March, the Civil Aviation Minister said. Egypt’s government debt declined to 77.4% of GDP by the end of 2024, down from 78.2% in September, marking its lowest level since March 2020, according to data from the Institute of International Finance seen by Al Arabiya.Kuwaiti Prime Minister Sheikh Ahmed Al Sabah will visit soon to announce new joint investment projects, Prime Minister Moustafa Madbouly said.Investment Minister Hassan El Khatib is expected to finalize a trade agreement with Morocco today to resolve an export standoff that has left 150 Egyptian containers, loaded with ceramics, food products, and insulation materials, stranded at Moroccan ports for two weeks.ETEL reported 4Q24 results. Net profit came in at EGP1.46 billion in 4Q24 (-43% YoY, -31% QoQ), bringing 2024 attributable net profit to EGP10.1 billion (-13.8% YoY). ETEL is currently trading at 2025f P/E of 5.3x.EFIH reported solid 4Q24 results. Net attributable profit recorded EGP382 million (+247% YoY, -39.4% QoQ). In 2024, net attributable profit stood at EGP1.77 billion (+41.2% YoY).  EFIH BoD proposed a cash dividend distribution of EGP0.173/share for 2H24, implying a DY of 1% and a DPO of 39.5% (out of 2H24 net attributable profit). Additionally, BoD proposed distributing 1 bonus share for each 2 original shares (a rate of 0.5 share for each original share), financed from internal sources. EFIH is currently trading at 2025f P/E of 17.3x.FWRY announced strategic investments worth EGP80 million in three prominent Egyptian technology companies, which are Dirac Systems, Virtual CFO, and Code Zone, acquiring equity stakes of 51.0%, 56.6%, and 51.0%, respectively. CNFN 4Q24 bottom line post minority recorded EGP247 million compared (+11% q/q, -3% y/y). The Group’s FY24 bottom line post minority recorded EGP657.7 million compared to EGP692.2 million in FY23 (-5.0% y/y). The company is trading at multiples of 1.1x P/B25 and 5.3x P/E25.CNFN’s CEO, Said Zater has stepped down as managing director and is starting a new role as the Group’s board advisor.SWDY has been awarded an engineering, procurement, and construction contract for a combined cycle power plant in Hungary, by MVM Matra Energia, a subsidiary of Hungarian Electric Company. Chemical Industries Holding decided not to offer Delta Fertilizers to a strategic investor, despite interest from five local and Gulf firms, according to local media. PHDC approved establishing a subsidiary in Abu Dhabi.