Egypt has hired six international banks to manage a 2 billion USD sukuk sale. Banks selected to help sell Egypt’s first Islamic bonds are Citigroup

Newsletter

27 Feb 2022

For our top talks today, Egypt has hired six international banks to manage a 2 billion USD sukuk sale. Banks selected to help sell Egypt’s first Islamic bonds are Citigroup, HSBC Holdings, Abu Dhabi Islamic Bank (ADIB), Credit Agricole, Emirates NBD, and First Abu Dhabi Bank (FAB). Unnamed sources also said that the issuance might take place in the second quarter (Q2) of 2022. The sukuk issuance comes in a time that is advantageous to Egypt, as borrowing costs are projected to increase in 2022 owing to the US Federal Reserve’s monetary policy. It is worth mentioning that Egypt raised 6.8 billion USD from Eurobond issuances in 2021. Egypt was the first in the Middle East to sell sovereign green bonds. (Bloomberg News)

The Egyptian Credit Bureau’s (I-Score) database of individual clients now includes 22 million records, while financing available for individuals accounts amounts to 400 billion EGP, according to I-Score’s Chairman and CEO Mohamed Kafafi.
Kafafi revealed that the total value of funding available for small and medium-sized enterprises (SMEs) reached 550 billion EGP, while benefitted entities registered around 510,000. About 5.5 million clients’ credit positions improved, Kafafi stated, adding that around 288,000 clients were deleted from negative lists in the framework of the Central Bank of Egypt’s (CBE) initiative for inclusion in the banking sector. (Al-Mal)
Egypt has enough wheat reserve for more than four months and there are options to secure wheat imports in case the Russian-Ukrainian crisis worsened, according to Mostafa Madbouly.
In a worst-case scenario, the Egyptian government would diversify wheat imports from many countries, which is currently happening. The prime minister highlighted the impact of the conflict between Russia and Ukraine on prices of several commodities across the globe. He added that the government has been studying such impact, especially on wheat prices, since the beginning of the conflict. Early February, tensions rose between Russia and Ukraine, the two largest suppliers of wheat to Egypt, and the situation became more complicated after Russia recognized separatist regions in Ukrain as independent countries. (Arab Finance)
Egypt signed a memorandum of understanding (MoU) with Hungary to form a joint committee for cooperation in trade and industry.
The new committee will take all measures to promote trade and industrial cooperation between Egypt and Hungary and to surmount all obstacles that affect cooperation between both countries, Egyptian trade minister Nevine Gamea stated. The MoU will be effective for five years renewable for another five years, Hungarian Minister of Foreign Affairs and Trade Péter Szijjártó. Moreover, Egypt’s General Authority for Investments (GAI) signed an agreement with Hungarian Export-Import Bank to promote investment opportunities in both countries. (Arab Finance)
Moreover, Egyptian exports to the European Union (EU) surged 56% to around 9 billion USD in 2021, from 6 billion USD in 2020, Egyptian trade minister Nevine Gamea stated.
Egypt’s total commodities and oil exports jumped to about 45 billion USD in 2021, from 28.3 billion USD the year before, Gamea revealed. Moreover, Gamea said that the value of trade exchange between Egypt and Hungary amounted to about 417 million USD in 2021, including 93 million EGP Egyptian exports to the EU member state. It is worth mentioning that Egypt signed a memorandum of understanding (MoU) with Hungary to form a joint committee for cooperation in trade and industry. (Al Borsa News)
Moreover, the Egyptian House of Representatives has finally approved the draft law on the amendments to provisions of the Capital Markets Act No.95 of 1992.
The draft law will allow entities operating in the facilities and public services to obtain necessary financings through the issuance of tradable bonds, of which proceeds would be directed to fund entities. This comes in line with the proposed rules by the Financial Regulatory Authority (FRA) that aim at offering the required financing for achieving comprehensive development as well as adding new non-banking financing instruments that comply with the facilities and public services. (Al Borsa News)
Moving to our EGX and companies talks, OneOrder, an Egypt-based logistics startup, has secured 1 million USD in funding.
The funding round was led by venture capital firm A15. “Given Egypt’s flourishing restaurant industry and the challenges it faces caused by a fragmented supply chain, OneOrder offers a much-needed technology-enabled solution at the perfect time,” Tamer Amer commented. OneOrder supplies meat, vegetables, and equipment, along with other items, to restaurants in Egypt. It was founded by Tamer Amer, founder of Fuego Sushi and Longhorn Texas BBQ Egyptian restaurants chains. (Arab Finance)
valU, a subsidiary of Egyptian Financial Group Hermes Holding (EFG Hermes) (HRHO) has extended their strategic partnership with Waffarha, a leading deals platform in Egypt.
This partnership will offer new benefits for customers as the two companies will witness remarkable developments in their “cross-selling capabilities” via a number of new programs. Under this collaboration, Waffarha’s payment method will be accepted through all of valU’s points of sales (PoS). Moreover, this will enable customers to recharge their Waffarha Wallet using valU, benefiting from the available service on Waffarha to pay bills via valU. Through this partnership, customers can receive instant credit limits to use across the wide range of services and products offered by both valU and Waffarha. (Arab Finance)
Castle Development has entered into a partnership with the New Urban Communities Authority (NUCA) to develop an integrated housing project on a total area of 50 acres in West Cairo, with investments estimated at around 8 billion EGP.
A new company will be established with 1 billion EGP in capital to manage the new project, which is located near 26th of July Axis. The company has studied all financing solutions for the project, including securing a loan from a group of banks, which is still under study and negotiations. Castle’s mega project is slated for completion within six years, to be ended in 2029. (Al Mal)
Eastern Company (EAST) announced that its board of directors has decided to boost production capacity of the company’s plants across the governorates gradually at its industrial complex in the 6th of October City.
This comes in line with the board’s strategy towards the optimum use of assets and resources to achieve sustainable development through upgrading the logistics of the company’s various products. Eastern Company is an Egypt-based company, which is engaged in manufacturing tobacco products. (EGX)
Tenth of Ramadan for Pharmaceuticals Industries and Diagnostic Reagents (Rameda) (RMDA) posted a consolidated net profit attributable to the parent company of 181.08 million EGP in 2021.
This marks an increase from the consolidated net profit attributable to the parent company recorded in 2020 of 112.18 million EGP. The company generated consolidated revenue of 1.24 billion EGP in the full-year ended December 31st 2021, jumping from 960.16 million EGP in 2020. Meanwhile, Rameda’s standalone net profit after tax rose to 182.20 million EGP last year from 112.94 million EGP in 2020. Moreover, the company’s board of directors has proposed the distribution of cash dividends worth 9.607 million t EGP o shareholders for 2021. (EGX)
Arab Drug Company (ADCI) recorded a net profit before tax of 74.21 million EGP during the first seven months of fiscal year (FY) 2021/2022.
This marks a decline from the net profit before tax of 86.07 million EGP recorded in the corresponding period of FY 2020/2021. Moreover, the company generated a net sale of 329.61 million EGP in the seven-month period ended January 31st 2022, compared to 335.56 million EGP in the same period of FY 2020/2021. (EGX)