China’s Evergrande Group announced on Sunday that it has resumed work on more than 10 projects in several cities
Let’s start with the hot topic abroad, China’s Evergrande Group announced on Sunday that it has resumed work on more than 10 projects in several cities, in a statement issued after it appeared last week to narrowly avoid defaulting on bond returns. Evergrande, which has commitments of about 300 billion USD, paid back 83.5 million USD in proceeds on a dollar bond issue, giving it another week to try to resolve the debt crisis that has cast a shadow over China’s economy, the world’s second-largest. It’s worth mentioning that the news of the repayment will bring some relief to investors and regulators, who are concerned about the broader implications of a chaotic default and contagion to global financial markets elsewhere, even though the company still needs to make payments on other debt maturities. (Reuters)
- Moving to our top EGX & companies talks, the US-based T. Rowe Price has taken part in the offering of e-finance for Digital and Financial Investments (EFIH) on the Egyptian Exchange (EGX),
marking its first time to participate in the local market. Moreover, other foreign institutions have participated in e-finance’s offering, including Franklin Templeton Investments and Goldman Sachs. The offering also witnessed the participation of major Egyptian institutions, including EFG Hermes (HRHO), Beltone Financial Holding (BTFH), Azimut Egypt, GIG Egypt, and Arabia investments Holding (AIH). It is worth noting that the stock of e-finance opened the second trading session on the EGX, with a strong rise of 14.4% until the first hour and a half of trading which started at the closing price of 21 EGP on Wednesday, to rise to 24 EGP until 10.50 of the Sunday session. (EGX)
- With this in mind, e-finance is targeting to implement an expansion plan at an estimated value of 2.3 billion EGP through pumping proceeds of the capital increase into its subsidiaries.
The company plans to expand in new sectors, including the tourism and the transport sectors. Proceeds of e-finance’s capital increase are projected to amount to 2.3 billion EGP, of which the company is likely to invest 1.1 billion EGP in the infrastructure of its subsidiaries. e-finance previously reported a consolidated net profit attributable to the parent company of 278.83 million EGP in the first half (H1) of 2021. Founded in 2005, e-finance is the first fintech platform in Egypt and a leading digital payment infrastructures’ developer. (Al-Mal)
- Moreover, the listing committee at the Egyptian Exchange (EGX) has approved the listing of the capital increase of International Company for Medical Industries (ICMI).
The company’s issued capital will be increased to 72.569 million EGP from 24.189 million EGP by 48.379 million EGP through the issuance of 48.379 million shares at a par value of 1 EGP per share, with issuance fees of 2.5 EGP per share. Established in 2004, ICMI operates within the health care equipment and services sector focusing on health care equipment. (EGX)
- Also, Misr Hotels Company (MHOT) has turned to profitability during the first three months of fiscal year (FY) 2021/2022.
The company achieved a net profit before tax of 66 million EGP in the July-September period of FY 2021/2022, versus a net loss of 67.85 million EGP in the year-ago period. Misr Hotels, a subsidiary of Holding Company for Tourism and Hotels, is an Egypt-based joint stock company engaged in tourism investment activities. (EGX)
- Furthermore, Agricultural Bank of Egypt (ABE) aims to build a distinctive brand, change the old brand image, and reach out to new customers.
The step comes as part of the bank’s expansion plans, which aim to make its banking and financing services reach nearly 35 million customers across the country. By the end of December 2021, the bank will have finished opening about 184 developed branches, as part of the first phase of the development plan. He added that the number of developed branches will reach 600 by the end of June 2022, as part of the second phase of the branch development plan. Additionally, by the end of 2022, the bank will have fully completed the development of 1,000 branches distributed all over the country. (Source: Arab Finance)
- Likewise, Telecom Egypt (ETEL) announced that it has obtained a new medium-term syndicated loan worth 500 million USD.
The telecom company will use the loan to bolster its capital expenditure and refinance existing short-term facilities. First Abu Dhabi Bank (FAB) and Mashreq Bank acted as the joint coordinators, underwriters, bookrunners, and initial mandated lead arrangers of the facility. It is worth noting that the aim of the facility is to convert the company’s short-term USD overdrafts into longer-term loans to enable the company to repay installments in line with its cash flow generation. (Arab Finance)
- In addition, Cairo for Investment and Real Estate Development (CIRA) has signed a partnership and investment management agreement with Al Ahly Capital Holding (ACH), the investment arm of National Bank of Egypt (NBE).
Under the agreement, a joint venture (JV) will be established under the name of Al Ahly CIRA for Educational Services S.A.E. The partnership between the two companies comes in line with their mutual objectives, including the provision of “top-notch world class education” to all segments of the Egyptian society, particularly the middle-income class. ACH is keen on supporting projects that target enhancing the quality and competitiveness of education in Egypt, including technology and applied education, in line with Egypt Vision 2030. (Arab Finance)
- Not to mention, Abu Dhabi Islamic Bank Egypt (ADIB) has obtained the approval of the Financial Regulatory Authority (FRA) regarding the launch of its consumer financing arm in Egypt.
ADI-Consumer Finance, which received its operating licence from the FRA, will provide Egyptian customers with seamless access to diverse financing products and services. The launch of ADI-Consumer Finance is a pivotal milestone in the bank’s journey in Egypt, reflecting its strategic ambitions to strengthen its leadership as an organization and pioneering the digitization of finance in support of our customer’s aspirations. (Arab Finance)
- By the same token, Premium Card International” intends to launch the “Al Jamia” product during the next few days of the current month of October for its current customer segment.
The company intends to launch a new product for it in the local market, which is “Al Jamia”, with its prevailing concept, which is established among a group of individuals by paying a certain amount of money, which a different person gets at the beginning of each month. This product will be available to the company’s customers only, with the aim of opening a new door to provide financial liquidity to individuals in an organized manner, especially in light of the conditions we are living in, specifically since the start of the virus pandemic. (Al-Mal)
- Turning to our macro watch, first, hotels operating in Egypt can now operate at full capacity for the first time in 18 months after the government lifted covid restrictions introduced in March 2020. Hotels have been operating at 70% capacity since July, as the government eased the 50% limit imposed since June 2020.
After the COVID spread, hotels were banned from opening their doors until they implemented new health and safety standards to prevent the spread of the virus. After acquiring the certificate, hotels were only allowed to operate at a 25% occupancy rate until the government raised the limit to 50% in late June. We believe the new decision will affect the tourism sector positively, as the government expects tourism revenues between 6-9 billion USD in 2021 due to the global vaccine rollout, which would help in normalizing international travel and visitors return to Egypt. (Akhbar El Yom)
- Second, Egypt’s Ministry of Finance revealed the establishment of an electronic system to track goods until the final customs release stage, for the first time in Egypt.
It is worth mentioning that the new law aims to encourage the national industry, reduce the cost of local production and maximize its competitiveness in global markets. Noting that the new law allows the payment of customs duties in instalments, for equipment, devices, production lines and supplies that do not enjoy any exemptions or reductions in customs tariffs. (Daily News)
- And finally, the Sovereign Fund of Egypt (SFE) has issued tenders for private companies to build 17 solar-powered desalination plants.
The tenders are part of a 2.5 billion USD plan to quadruple our desalination capacity in the next five years. The bid process is already underway and investor appetite is strong for the 25-year concessions. The agreements will see private firms hire their own contractors to build the plants, which will run on high-yield renewables. The plan fits into Egypt's push to diversify its sources of fresh water for a fast-growing population as it faces competition for Nile river water from the giant hydropower dam that Ethiopia is building upstream. (Reuters)
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