Pre-Trading Thoughts

Budget deficit increased to 5.9% of GDP, recording EGP789.8 billion during 7M23/24, from 4.4% in 7M22/23.Suez Canal revenues declined by 50.7% during the first two months of 2024.The government has conducted preliminary studies on a project to duplicate the remainder of the Suez Canal to better support two-way traffic.Yields on EGP-denominated one-year bills hit a record high 30.061% during the Central Bank’s latest auction held on Thursday.ETEL (FV: EGP51.00, OW) released 4Q23 results. Net profit came in at EGP2.31 billion in 4Q23 (-23.2% YoY, -5.8% QoQ). During 2023, net profit came in at EGP11.46 billion (+24.9% YoY).  EFID (FV: EGP40.30, OW) released 4Q23 results. Net profit recorded EGP351 million (+3.4% YoY, -24.5% QoQ). FY23 net profit recorded EGP1,632 million (+59.1% YoY). POUL (FV: EGP12.76, OW) released 4Q23 results. 4Q23 net profit reached EGP31.5 million (-58.9% YoY, -91.3% QoQ). FY23 net profit recorded EGP1,147 million (+287.8% YoY). HELI (FV: EGP18.84, OW) received an offer from MASR (FV: EGP5.24, OW) to co-develop three land plots amounting to a total of 580 feddans in New Heliopolis. TMGH (FV: EGP73.80, OW), through its hospitality arm, Icon, has completed all procedures to acquire a 51% stake with management rights in Legacy Hospitality. EMFD reported positive 4Q23 results. Net profit in 4Q23 increased 9.6% y/y and 21.7% q/q to EGP1.8 billion, bringing FY23 net profit up 3.8% y/y to EGP6.8 billion.AMIC released its figures for January 2024 where auto sales in January fell to their lowest level since April 2023, noting a 40% m-o-m drop to 6.3k units. EGAL released its preliminary budget figures for FY24/25, targeting net profit after tax of EGP4.3 billion vs. EGP3.7 billion recorded in FY22/23. The budget also includes proposed investments worth EGP1.6 billion for the year. MCQE reported 4Q23 and FY23 consolidated financial results, recording an attributable net profit of EGP80.7 million in 4Q23, reversing previous quarter net loss of EGP29.7 million, and more than double comparative quarter net profit of EGP34.0 million mainly on healthy operating margins. This brings FY23 bottom-line to EGP94.8 million (-2% YoY). LCSW released solid 4Q23 financial results. Attributable net profit recorded EGP110.8 million in 4Q23 (+194% YoY, +40.9% QoQ). ECAP released 4Q23 financials. Net profit of EGP31.4 million in 4Q23 (-6.3% YoY, -55.7% QoQ). In 2023, net profit recorded EGP219.5 million (+28.3% YoY). EFIC released 4Q23 consolidated results. Net profit increased by 42% YoY (+131% QoQ) to EGP184.7 million in 4Q23. Net income declined by 5% YoY to EGP699.9 million in 2023 mainly due to higher interest expense.OPEC+ producers led by Saudi Arabia and Russia yesterday agreed to extend voluntary oil supply cuts of 2.2 million barrels per day (bpd).ISPH released 4Q23 financial results. Net profit dropped by 26.9% YoY and 5.7% QoQ to record EGP39.6 million in 4Q23. Bottom line increased by 23.6% YoY to record EGP213 million in 2023. ISPH is trading at 2024f P/E of 9.8x and EV/EBITDA of 4.8x.ADIB has withdrawn its mandatory tender offer submitted in December to acquire the free-floating share in its subsidiary, Cairo National for Investment and Securities.CANA BoD approved increasing its authorized capital to EGP10 billion from a current EGP5 billion to support the bank’s future growth plans.CNFN is currently conducting feasibility studies ahead of its planned launch in Saudi Arabia by 2025 to serve the 3 million Egyptian expats living there. BINV’s BoD approved a USD3 million investment in subsidiary and fintech platform, Basta Holding for Financial Investments.Weekly Commodities Update