Pre-Trading Thoughts

Al Ahly Pharos

*Key news articles for today*

The Minister of Planning expects the agreement with the European Union to grant Egypt EUR4 billion in funding next June to support the budget as part of the structural reform program for the economy.

Egypt’s USD bonds were among the emerging markets’ top gainers following Trump’s return to the White House and the Gaza ceasefire.

The government cleared up USD1 bn in arrears owed to foreign oil companies in the first week of January. A new schedule to settle the accumulated USD6.5 bn in arrears had been agreed on with companies, with repayments set to run from next month until June 2025.

The Suez Canal is preparing to receive the navigation services of major shipping lines, as it is expected to benefit from the ceasefire agreement in the Gaza Strip. The Houthis have announced a halt to attacks on American and British ships in the Red Sea region, after the Gaza truce agreement came into effect.

State-owned Arab Organization for Industrialization’s (AOI) joint solar panel manufacturing project with Sweden’s Sunshine Pro is set to be operational in July of this year and have a production capacity of 1 GW of panels by July 2026, AOI’s Arab Renewable Energy Company Executive Director said. The project is expected to cost somewhere between USD200-300 mn.

Over 12k medical tourists from 50 different countries visited Egypt for treatment in 2024, an increase of 200% y-o-y, the Egyptian Healthcare Authority said.

The government targets proceeds of EGP250 million to EGP350 million from the offering of Misr Pharmaceuticals Company during 1H25. Sources told local press that the government intends to offer a 25% to 30% stake in the company, in addition to offering the same stake in Seed Pharma.

OLFI Net profit recorded EGP279 million in 4Q24 (+70.9% YoY, -6.8% QoQ). In FY24, net profit recorded EGP1,000 million (+112.5% YoY). OLFI is currently trading at FY25f P/E of 7.4x.

BoD proposed cash dividend distribution of EGP2.0/ share implying payout ratio of 80% and dividends yield of 10.4%.

EGBE 4Q24 stand-alone bottom line recorded EGP620 million (-11% q/q, +69% y/y), bringing FY24 bottom line to EGP2,550 million (+80% y/y, and 18% higher than Al Ahly Pharos estimates). BoD proposed increasing the paid-in capital by EGP550.55 million through bonus shares and proposed cash dividends distribution of EGP0.99/per share.

Ministry of Environment assigned cement companies to expand in establishing waste recycling plants to produce alternative fuel (RDF), with five cement players have committed to fund 13 plants throughout 2025.