Arab Finance: Egypt’s stock exchange benchmark EGX 30 index increased by 2.74 % this week, representing a jump of 183.39 points, ending Thursday transactions at 6864.19 points compared to 6680.80 points at the end of last week.
Regarding current week trading, the index hit its highest point on Wednesday closing at 6888.45 points, where its lowest point was on Sunday, at 6697.73 points.
On Sunday, Egypt’s stock exchange benchmark “EGX 30 index” extended gains for the ninth session in ten since 2010 start and advanced by 0.25 % to close at 6,697.37 points in fluctuated session. Market trade volume reached 126,838,892 transactions amounted to L.E 1,166,470,729.
Egypt’s stock exchange benchmark “EGX 30 index” continued in green and gained 0.42 % on Monday fluctuated session to close at 6,725.28 points. Market trade volume reached 141,140,407 transactions amounted to L.E 1,539,866,787.
On Tuesday, EGX 30 index went on its upside trend and jumped by 1.61 % to close at 6,833.26 points (top point for two months). Market trade volume reached199,141,630 transactions amounted to L.E 2,793,546,232.
Egypt’s benchmark “EGX 30 index” climbed 0.81 % in Wednesday session to close at 6,888.45 points. Market trade volume reached 150,982,371 transactions amounted to L.E 1,795,196,051.
On Thursday, EGX 30 index ended its upside trend and dipped slightly by 0.35 % session to close at 6,864.19 points. Market trade volume reached 160,521,456 transactions amounted to L.E 1,440,198,238.
Companies’ weekly performance highlights:
Orascom Telecom Holding (OT) - (ORTE) stock closed on Sunday at LE 28.55 while closed on Thursday at LE 29.94, up by 5 % and about L.E 1.39.
The highest price for the stock during the week came on Wednesday when it closed at LE 29.98, while the lowest price for the stock during the week came on Sunday at L.E 28.55.
On Sunday, OT Globalive Communications is in talks with banks to raise “several hundred” million dollars in debt to finance expansion, CEO Anthony Lacavera said.
Globalive plans to select banks to manage the sale in the next few weeks, Lacavera said in an interview today in Toronto. He declined to name the lenders.
The company is considering bonds and syndicated loans, which may be used to repay debt as well as fund expansion of the network in Western Canada and Ontario, he said.
“We need to accelerate our business plan,” Lacavera said. “We’ve got to get that network built aggressively and stick with our model across the country as fast as possible.”
The company is targeting 1.5 million subscribers over three years, compared with more than 8 million for Toronto-based Rogers, Canada’s largest mobile-phone company.
On Wednesday, Mohamed Fayed, Head Corporate Banking at Banque Misr reported that participating global and local banks in OT L.E 2.5 billion loan are nearing approval on company L.E 4.3 billion capital increase.
Moreover, Fayed added that the participating banks (including Banque Misr) saw such capital increase as a supporting step to OT cash flows and financial restructure particularly after tax retention imposed on its Algerian unit.
Orascom has to announce if it receives approval by January 24 at maximum. Subscription call will be null if the banks reject the capital increase.
On Thursday, Canada’s mobile-phone penetration rate, which trails poorer countries like Algeria, may climb to 100 percent within a decade as more customers opt for prepaid contracts, according to OT.
There were 66 wireless subscriptions for every 100 Canadians in 2008. There is no reason why Canada can’t match rates in Greece or Italy, which are above 120 percent, said Khaled Bichara, chief executive officer of the Cairo-based company that is backing Canada’s newest wireless carrier.
“Passing 100 percent is a matter of when not if,” Bichara, 38, said in an interview yesterday. If the penetration rate in Canada doubled to European levels, and “if we even take a small percentage of that doubling, that’s still a big business for us,” he said.
Orascom is investing as much as $700 million in Globalive Communications Corp., which began selling mobile phones to Canadians last month.
Egyptian Company for Mobile Services (Mobinil) - (EMOB) stock closed on Sunday at LE 226.9, while closed on Thursday at LE 230.18, gaining 1 % by L.E 3.28.
The highest price for the stock during the week came on Wednesday when it closed at LE 231.18, while the lowest price for the stock during the week came on Sunday, at LE 226.9.
On Sunday, Mobinil was upgraded to “buy” from “neutral” at UBS AG, which cited an “attractive” valuation and “superior” long-term growth outlook.
The brokerage increased its price estimate to 280 Egyptian pounds from 250 pounds on earnings estimates and lower risk premium, according to a note dated today.
Separately, Mobinil announced that it made a L.E 750 million installment to the telecom regulator as part of a payment for its 3G license.
On Monday, Khalid Ellaicy, company CFO stated that his company paid 3G installment through its available liquidity.
“After payment we still have L.E 1 billion in cash as credit facilities,” He noted, adding that Mobinil did not get more facilities to cover the payment.
Moreover, Mobinil is awaiting new codes and NTRA securing to frequencies domain. He added that Mobinil paid L.E 1.5 billion out of the total L.E 2.250 billion.
On Wednesday, Tarek Kamel, Minister of Communication & Information Technology invited OT and FT to hold an urgent meeting in the ministry headquarter and with attendance of Amr Badawi CEO of NTRA.
The purpose of the meeting is to exchange opinions over Mobinil deal dispute and to reach a fruitful solution to end the current crisis between the two parties.
Kamel expressed his fears that continuing legal dispute may hit Mobinil operations and added that I will try to reach a neutral agreement between the two companies.
The dispute is commercial and we are asking the two parties to meet once more to discuss a solution that would satisfy them," Ahmed Raouf, spokesman for minister Tarek Kamel, said on Wednesday.
On Thursday, France Telecom said it and OT held high-level discussions in the past week to find a resolution to their prolonged battle for control over Mobinil.
FT deputy chief executive Jean-Yves Larrouturou, who heads the business in Africa, Middle East and Asia, has spoken with Orascom executive chairman Naguib Sawiris since a court ruling on January 13 halted a tender offer that would have seen the French group seal control of Mobinil.
The two sides have been in touch at various points throughout the conflict, a France Telecom spokesman said, adding: "The discussions are continuing. We are also in touch with Egyptian authorities".
Egyptian Financial Group-Hermes Holding Company - (HRHO) stock closed on Sunday at LE 31.47 while closed on Thursday at LE 31.46, slightly down by L.E 0.1.
The highest price for the stock during the week was on Sunday when it closed at LE 31.47, while the lowest price for the stock this week came on Tuesday, at LE 31.06.
On Sunday , Lebanese ex-Prime Minister, Naguib Mikati, said he is about to acquire 14 % in EFG-Hermes 28 %stake in Audi Bank; while other Arab and Lebanese investors will acquire the remaining stake.
Close source to Mikati’s family stated that the deal has entered the final stage, adding that acquisition details will be revealed within weeks.
Yasser Almallwany, CEO of Hermes, attributed selling company’s stake in Audi Bank to business reasons, as the company asserted previously it is discussing a number of strategic options to enhance its investment position, one of which is to sell Audi’s stake.
On Monday, EFG-Hermes announced that it has sold its stake in Lebanon's Bank Audi for $ 913.4 million, as the 28 % investment was tying up too much of its funds and afforded no prospect of control.
EFG-Hermes sold 7.5 million common shares and 2.5 million GDRs in the bank, it said in a regulatory statement on.
"With one investment, without control, representing over 50 percent of our adjusted book value, it became clear that a divestiture should be considered," EFG-Hermes said in the statement.
"After lengthy discussions with Bank Audi regarding a combination of the two businesses, it became evident after the events of 2008 that an amalgamation in the near future will be difficult," the EFG-Hermes statement added.
EFG-Hermes made an unconsolidated capital gain of $ 260 million on the sale, it said.
A statement released by Audi said "a group of its existing shareholders, as well as a number of other high net worth individuals and entities investing directly or through investment vehicles" bought the stake at a price of $91 per share and GDR.
"Following the transaction, none of the purchasers individually own 5 percent or more of the common shares of the bank," the Audi statement said.
Lebanon's M1 group, owned by the Mikati family, bought part of the stake, one financial source said, without giving further details.
EFG-Hermes Holding Company was again the number one broker on the Egyptian Exchange (EGX), the Abu Dhabi Securities Exchange (ADX) and the Dubai Financial Market (DFM) for the full year 2009, and according to data independently available from the region's stock exchanges.
The firm also posted strong finishes in Kuwait, Oman and Saudi Arabia, among other markets.
"The year 2009 was a rollercoaster for global financial markets, but EFG Hermes Brokerage succeeded as a balanced business focused on serving and advising clients across a diverse institutional, high-net-worth and retail base.
Our unparalleled market access and commitment to technological innovation and order execution in all major Arab markets back this commitment to client needs and support its market leadership," said Sherif Cararah, Head of Securities Brokerage at EFG Hermes.
El Ezz Steel Rebars - (ESRS) stock closed on Sunday at L.E 18.54 while closed on Thursday at L.E 18.57 (about L.E 0.03 drop).
The highest price for the stock during the week was on Wednesday when it closed at LE 18.85, while the lowest price for the stock this week came on Sunday, at LE 18.54.
On Tuesday, Kamel Galal, company Investor Relations Manager stated that Suez flat steel plant will be inaugurated in the end of next February.
He added that the company will operate billet steel production line (values $ 75 million) with 1.2 million tons production capacity.
According to Galal, production in the new sponge steel plant in Suez ( at $ 400 million) is scheduled to start in 2H/2011 with production capacity of 1.9 million tons.
Moreover, he highlighted the significant increase in flat steel prices at the end of Q3 and Q4 of 2009 will boost company annual profits.
It is worth mentioning that, Ezz steel group submitted al documents to Ministry of Trade and Industry as a part of local steel companies plant to take anti dumping measures against Turkish imports.
He added that, the company is targeting to increase its profits during the first quarter of 2010 by about 10-15 %.
Orascom Construction Industries (OCIC) stock closed on Sunday at LE 264.31 while closed on Thursday at LE 269.41 with 2 decline (L.E 5.1).
The highest price for the stock during the week was on Wednesday when it closed at LE 272.37, while the lowest price for the stock this week came on Sunday, at LE 264.31.
On Thursday, CI Capital increased target price of Orascom Construction Industries (OCIC) by 19 % to L.E 310 per share from L.E 260.8 but maintained LTFV at L.E 266.9/share.
The brokerage argued that the Chinese government has amended its fertilizer export tariffs and such change will come into effect in late January. Consequently, export tax on urea from will be increased from 7% to 100%.
CI Capital expected urea price to hit $ 367/ton in 2010 up from current $ 315. Hence, OCI fertilizer business should be positively affected sooner than expected. These higher tariffs are a catalyst for stronger fertilizer prices in the near term and possibly a materially stronger price than expected going forward .
Moreover, it added that the new TP implied that fertilizer LoB would trade at 15.7x in 2010E EV/EBITDA compared 15.2x for its international fertilizer peers. It also implied some 14 % upside potential and ,as a result, CI Capital reiterated its Hold recommendation.
Sectors performance:
The most active sectors all through the week were Personal and Household Products, Financial Services excluding Banks, Construction and materials, Real Estate and Telecommunications.
Financial Services excluding Banks came first in terms of performance, as it achieved total traded value of LE 1,121,976,649.
Real Estate sector ranked second in terms of performance, as it achieved total traded value of LE 1,054,204,274.
Thirdly, Food and Beverage sector, it achieved total traded value of LE 733.282.127.
Fourthly, Telecommunication sector, it achieved total traded value of LE 659,139,147.
Finally, Construction and Material, it achieved total traded value of LE 631,506,246.
Regarding the investors’ activity:
-Local investors led the market activity all through the week, followed by Foreign and Arab investors respectively.
-Foreign investors were the most active buyers all through the week as they dominated the market by the value of LE 468.280.292.
-Local investors were best sellers through this week by the value of LE 256,113,236.
-Arab investors were also net sellers by the value of LE 212,167,057.
Retail and Institutions’ activity:
Retail activity led the market all through the week as it ranged between 46.47% to 71.43%, while Institutions activity ranged during this week between 28.56% to 53.52.75%.
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