Pre-Trading Thoughts

HRHO| Buy the Shift to Full-Fledged Banking and Non-Banking Services and Improved Sustainability in Earnings Growth; Lending businesses at 50% of bottom-line in 2 years (up from c.37% in 9M21) should improve group margins with its higher NPM (c.27%) vs IB platform NPM (25%); Microfinance and consumer finance services compromise 40% of FV; ValU stake sale would reprice and unlock the unrealized value of the NBFIs platform and the upside potential of HRHO in general; AIB (12% of FV) acquisition is expected, within two years, to improve group profitability; HRHO should deliver earnings of EGP1,353 million in 2021 and EGP 1,556 million in 2022; The company is currently trading at P/E22 9.0x and P/B22 0.9x.Weekly Commodities Update| Retail cement prices in Egypt inched up at EGP1,100 -1,200 per ton (ARCC); Diesel-HSFO spreads were up 4% WoW and are at USD341/ton (CCAP); Egypt Urea Index dropped by 6% WoW and prices are currently at USD755/ton; Steel/Iron Ore spreads stood at USD421; up 4% vs. last weeke-cards of EFIH signed a contract with TGI (healthcare services provider in Zimbabwe) to issue and manage smart cards for 10 years; Significant step for ecardsKhales of EFIH applied to the FRA to obtain consumer finance and microfinance licensesRAYA is to expand the production of electric minibus; to manufacture the TV brand “SARY” and Samsung washing machines; Received offers for a stake in AmanAUTO’s MNT-Halan CEO declared that the company is looking for several countries in Africa; To expand in Egypt in the short-term by including cards and supply chain financing Metito-ORAS alliance plans to establish desalination plants in Libya and Iraq at an investment that is not less than USD50 millionMinistry of Transport assigned roads' construction works worth EGP1.81 billion to 3 contractors including ORASTo reduce the burden of financing cost for SMEs, the FRA has issued steps for pricing SME-financing productsMCRO's IPO retail offering was 102x oversubscribed, First day of trading is February 10EXPA approved an increase in the bank’s issued and paid-in capital by EGP2 billion, to reach EGP5.27 billion, through a rights issueThe industrial and real estate assets of Egyptian Iron and Steel Company (IRON) are currently being evaluated before liquidationKuwait Airways is launching direct flights to Sharm El Sheikh, Sohag, and Alexandria in May 2022