KEY THEMES
As EGX-listed companies continue to publish their Q2 earnings reports, investors will be on the lookout for signs of recovery post-COVID-19. One of the companies that have just reported strong annual growth (i.e. post vs. pre-COVID-19) is Edita Food Industries [EFID] which has seen earnings more than doubled in H1 2021, thanks to revenue growth across almost all segments which was mostly driven by volume and in part by price. Both bakery and cakes segments took the lead in delivering such strong results. This implies that TTM P/E is now 12.3x after incorporating Q2 2021 results. EFID has not yet re-rated since we highlighted that it is undervalued back on 22 June 2021.
POSITIVE
EFID: We believe the stock should react positively to the strong earnings report with the stock offering an upside in excess of 50%.