Today’s Top News & Analysis
New historic high for CPI in September
IMF cuts growth expectations for Egypt
Egypt secures another Russian wheat purchase
Chevron re-routes Israel's gas exports to Egypt
QNBA Q3 2023: Tamed earnings' growth
FAIT Q3 2023 prelim: Picking performance up
MACRO
New historic high for CPI in September
The annual headline urban CPI recorded a new high of 38% in September 2023, breaking the record high of 37.4% y/y in August 2023. Meanwhile, the monthly headline urban CPI increased by 2% against 1.6% in August. As for annual core inflation, it increased by 39.7% against 40.4% in August. (CBE)
IMF cuts growth expectations for Egypt
The International Monetary Fund (IMF) has downgraded its 2024 Egypt growth outlook to 3.6% from its previous 4.1% forecast in July. This is the second time it has lowered its 2024 outlook this year, cutting it to 4.1% from 5.0% in July, referring to the lack of foreign currency and declining investor trust. (IMF)
Egypt secures another Russian wheat purchase
The General Authority for Supply & Commodities (GASC), bought 480,000 tons of Russian wheat through a direct trade this week. The purchase should be shipped in November and December. (Enterprise)
Chevron re-routes Israel's gas exports to Egypt
Chevron Corp. is re-routing offshore Israeli natural gas shipments to Egypt through a pipeline in Jordan after the Hamas attacks prompted the shutdown of the Tamar field in the Mediterranean Sea. The closure of the field caused shipments of Israeli gas to fall to 650 mn cubic feet per day from 800 mn cf/d on Monday. (Reuters)
CORPORATE
QNBA Q3 2023: Tamed earnings' growth
Qatar National Bank Al Ahli [QNBA] announced Q3 2023 standalone results. Here are our main takeaways:
· Despite net interest income (NII) increasing by 11% q/q to EGP7.9bn reflecting the consecutive rate increases this year, net income came in almost flat q/q at EGP3.7bn.
· This can be attributed mainly to 3 reasons: (1) a significant increase in provisions by 41% q/q to EGP1.6bn (+85% y/y) (2) a 20% q/q in income tax to EGP2.2bn raising the effective tax rate up to 37% (3) a 26% q/q increase in other operating expenses to EGP240mn.
· On the other hand, other miscellaneous income such as trading income or dividends income or gain on investments have all seen q/q decline, which ate up from top line growth.
· Growth in QNBA’s loan book came at 13% ytd hitting the EGP300bn mark, derived by growth in retail loans. However, there was a slight uptick in the bank’s NPL ratio to 5.3% and a 5pp decline in coverage ratio to 116% in spite of the huge provisions.
· As for deposits, corporate deposits helped push the total ytd growth to 22% to reach EGP498bn, where the GLDR declined to the lowest in a long time for QNBA 52%.
· Additionally, the bank still resorts to treasury bills investments, raising its balance by 100% ytd to EGP136bn, which explains the hike in the effective tax rate.
· Now, given the increase in NII, the bank’s annualized NIM increased to 6.3%, while the annualized ROAE declined slightly to 25%.
· The bank is currently traded at a P/E of 3.2x and a P/BV of 0.8x. (Bank disclosure)
FAIT Q3 2023 prelim: Picking performance up
Faisal Islamic Bank [FAIT] announced the preliminary results for Q3 2023, where net income increased by 39% q/q to EGP771mn. Net interest income, however, remained almost flat q/q at EGP1.4bn. Now FAIT’s annualized ROE improved to 13% this quarter after falling sharply to 9% in Q2 2023. The bank is traded on an annualized P/E of 5.4x and a P/BV of 0.7x. (Bank disclosure)
MARKETS PERFORMANCE
Key Dates
11-Oct-23
ORAS: EGM / Discussing the dividend distribution of USD0.2750/share.
EFIH: OGM / Approving financial statements ending 30 June 2023 and the proposed dividends.
12-Oct-23
EGTS: OGM / Approving financial statements ending 31 Dec. 2022.
EGCH: OGM / Approving financial statements ending 30 June 2023.
EGCH: EGM / Amending Article No. 3 & 21 of the company's bylaws.
17-Oct-23
POUL: OGM / Discussing dividends distribution.
18-Oct-23
EFIC: Cash dividend / Payment date for a dividend of EGP1.5/share (3rd installment).
23-Oct-23
ABUK: Cash dividend / Deadline for eligibility for a dividend of EGP7.00/Share.
EAST: Cash dividend / Deadline for eligibility for a dividend of EGP3.75/Share.
MICH: Cash dividend / Deadline for eligibility for a dividend of EGP3.00/Share.
25-Oct-23
EGAL: OGM / Approving financial statements for 2022/2023.
26-Oct-23
ABUK: Cash dividend / Payment date for a dividend of EGP2.00/share (1st installment).
MNHD: Cash dividend / Payment date for a dividend of EGP0.075/share (2nd installment).
EAST: Cash dividend / Payment date for a dividend of EGP2.00/share (1st installment).
MICH: Cash dividend / Payment date for a dividend of EGP1.50/share (1st installment).
29-Oct-23
PRCL: OGM / Approving financial statements ending 30 June 2023.
PRCL: EGM / Amending Article No. 3 of the company's bylaws.
31-Oct-23
MCRO: Cash dividend / Payment date for a dividend of EGP0.096/share (2nd installment).