Prime Minister said that a subsidized bread loaf will be sold at 20 piastres, up from 5 piastres starting in June.

The government is currently looking into replacing subsidies with cash support, a move which will allow citizens to use the support according to their needs.

The government will hike electricity prices in July with the beginning of the new fiscal year. On average, the hikes will exceed 20%, but not yet determined.

The EU and Egypt are expected to sign an EUR35 million financing agreement next month to fund renewable projects.

The state has put forward some 45 potential investments within the healthcare sector in front of the private sector.

The Supply Ministry will ink a number of contracts with local and foreign companies next month to set up 12 trade and logistic centers, worth a combined EGP40 billion.

The government plans to exit renewable energy projects, to make a way for the private sector to implement the state’s plans to expand the production of electrical energy from its renewable sources.

Egypt's exports of ready-made clothing increased to USD856 million during the 4M 2024, an increase of 23% y/y.

ETEL recorded 1Q24 net profit came of EGP3.88 billion (+1.9% YoY, +68% QoQ). ETEL is trading at 2024f P/E of 3.8x.

MTIE reported 1Q24 net attributable profit of EGP248 million (+62% YoY, +16% QoQ). MTIE is trading at 2024f P/E of 11.4x.

HDBK1Q24 standalone net profit recorded a strong EGP2,426 million (+51% q/q, +83% y/y). HDBK is currently trading at 2024 P/E of 2.6x.

BINV (FV: EGP34.16, OW) released positive 1Q24 bottom line recorded EGP892 million (+167% y/y).

ValU, HRHO’s subsidiary, signed a partnership agreement with the Magdi Yacoub Heart Foundation to facilitate donations. Also, the company is targeting securitization issuances worth EGP1.25 billion by mid-July and a financing portfolio of EGP13 billion by the end of 2024 (+45% y/y).

The online marketplace Jumia and CNFN’s Creditech have renewed their partnership, which started in January 2023.

ECAP recorded a drop in 1Q24 net profit to EGP13.8 million (-76% YoY, -56% QoQ) on the back of operating margins erosion, increasing financing costs along with a FX loss of EGP35.4 million. ECAP is currently trading at FY24e P/E of 14.4x.

We updated our FV for LSCW to EGP30.08/share (+35% upside potential), maintaining our Overweight recommendation, where the recent economic reforms, mainly EGP floatation, have been instrumental in shaping LCSW's operational performance.

MBSC to reduce its capital from EGP679.3 million to EGP611.4 million by cancelling treasury shares in total of 6.8 million shares, effective June 3, 2024. Accordingly, we adjust MBSC’s FV to EGP49.08/share from EGP44.17/share.

SCEM is increasing its issued and paid-in capital through a rights issue from EGP1.3 billion to EGP3.0 billion. The capital increase proceeds will be used to pay the company’s loans and credit facilities in order to reduce financing costs.

ATQA released 1Q24 net profit of EGP60.9 million, -53% lower y/y, on the back of tighter operating margins as well as a negative figure of EGP123.6 million resulting from the revaluation of short-term investments in listed stocks.

Ashry Steel Group aims to invest EGP8 billion into expanding its operations over the coming two years.

POUL reported 1Q24 attributable net profit of EGP548 million (flat YoY, +17.2x QoQ). The substantial sequential growth in bottom line is mainly attributed to the weak base effect of 4Q23 given the high FX losses. POUL is currently trading at 2024f P/E of 1.8x.

ALCN reported net profit of EGP4.08 billion in 9M23/24, increase of 28% YoY.

EGAS purchased an additional 0.61% stake, representing 12.8 million shares, in MFPC, bringing its stake in the company to 9.07%.

Market Overview

Egypt is looking to welcome some 15.5-16.5 mn tourists this year, Tourism Minister said. The Ministry has revised its initial target of 17-18 mn due to geopolitical tensions.

There will be no increase to income tax rates or brackets, Finance Minister, in response to media reports that claimed otherwise.

The government is looking to launch a telecom-focused sub-fund under the Sovereign Fund of Egypt (SFE) within weeks.

The Ministry of Environment is preparing a package of projects worth close to USD15 billion to confront climate change, to be delivered soon to international development institutions.

Seven Turkish ready-made clothing companies have requested to move their factories to Egypt.

Bonds worth USD1.25 billion that were issued by the government in 2020 are due today. There is another bond repayment next November with a value of USD1.35 billion.

Finance Minister recently issued a decision to enhance the “Primary Dealers” system for government debt instruments. This move aims to stimulate activity in the secondary market.

GBCO released 1Q24 results:

Consolidated attributable net profit recorded EGP626 million (+482.1% YoY, +1.0% QoQ). GB Auto’s net profit spiked by 742.6% YoY to recorded EGP380 million. GB Capital net profit improved by 30.8% YoY yet dipped by 57.0% QoQ to record EGP248 million, this sequential decline came on the back of a high-base effect driven by significant securitization gains realized in 4Q23. GBCO is currently trading at a FY24 P/E of 3.9x.

ORWE reported solid 1Q24 results:

Attributable net profit of EGP427 million (+4.1% YoY, -3.6% QoQ). The sequential decline came on the back of FX losses in addition to the one-off high income tax, due to distortion by dividends distributed from group entities. ORWE is currently trading at 2024f P/E of 4.7x.

PHDC achieved stellar 1Q24 results, with 1Q24 sales soaring 376.6% y/y and 31.8% q/q to a remarkable EGP32.3 billion, driven by Badya and the launch of P/X, the company’s latest project next to Palm Hills October. PHDC is comfortably on track to exceed our FY24 sales forecast of EGP66.2 billion.

HELI declared EGP1.34/share cash dividends (DY of 12.9%). Record date is 10 Jun-24. Distribution date is 13 Jun-24.

ARCC reported 1Q24 attributable net income of EGP152.6 million (-37% YoY, -23% QoQ). Bottom-line drop was mainly backed a FX loss hit on the company’s P&L. ARCC is trading at FY24 P/E of 5.3x.

MCQE reported 1Q24 attributable net income of EGP31.5 million (-52% YoY, -61% QoQ). Operating margins were adversely affected by high exchange rates as the Group depends mainly on imported coal as its main source of energy to operate its plants. MCQE is trading at FY24e P/E of 16.8x.

CICH 1Q24 net attributable profit recorded a strong EGP940 million (+220% q/q, +194% y/y), mainly boosted by FX gains, which recorded EGP1,039 million. CICH is currently trading at P/E24 of 3.0x.
CICH has announced its intentions to set up an on-the-ground presence for its investment bank in Saudi Arabia and the UAE.

Some 200 pharma products could be subject to price hikes ranging from 5-20% starting next week. The price hikes will eventually hit a total of 1.5k products over the coming 12 months.

RMDA announced the launch of Ramelact, Egypt's first Lactase Enzyme supplement for the treatment of Lactose Intolerance.

ADQ’s AD Ports has inked an MoU with Egyptian shipping giant Transmar and ORAS to explore the possibility of setting up a green methanol storage and export facility targeting maritime transport.

ElSewedy Cement increased its stake in CCAP from 3.85% to 5.51% through at an average price of EGP2.44/share.

KIMA received the FRA's approval to invite shareholders to subscribe to the remaining shares of the capital increase amounting to 3.4 million shares.&