Today’s Trading Playbook
KEY THEMES
Yesterday, we published our pre-IPO note on e-finance [EFIH], where we evaluated the stock from all angles. Set at EGP13.98/share, EFIH’s IPO price indicates the following:
· EFIH’s market cap of EGP24.9bn is 444% higher than FWRY’s EGP4.6bn at IPO debut and 6% below FWRY’s current market cap of EGP26.3bn.
· EFIH’s implied TTM P/E of 51.8x is at a 30% discount to FWRY’s IPO TTM P/E of 73.7x and a 55% discount to FWRY’s TTM P/E of 114.9x.
· EFIH’s implied forward P/E of 45x is at a 4% premium to FWRY’s IPO forward P/E of 43.1x and a 49% discount to FWRY’s forward P/E of 88.9x.
The aforementioned points would emphasize EFIH’s cheaper multiples to Fawry [FWRY], its only EGX-listed peer. Looking at the aforementioned set of multiples made us curious about those of EFIH’s peers in emerging markets (EM), which drew us to the conclusion that, from a TTM P/E perspective, EFIH is 17% cheaper than its EM peers with a TTM P/E of 62.5x. Thus, EFIH’s implied valuation from the eyes of developing markets peers could fetch EGP16.9/share. This suggests a 21% upside to EFIH’s IPO price of EGP13.98/share.
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