Elsewedy Electric [SWDY]: Turning Copper Into Gold
A deeply-undervalued industrial leader; OW/M maintained but at a higher 12MPT
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Elsewedy Electric [SWDY]
Egypt / Industrials / Core Coverage Update
12MPT: EGP21.0 (+72%, was EGP14.3)
set on 18 Dec 2022
Investment Rating: Overweight | Risk Rating: Medium
In view of higher commodity prices and a weaker EGP, Elsewedy Electric [SWDY] managed to grow its earnings, powered by a robust business model and shrewd management. Sprouting outside Egypt, SWDY was able to expand its business steadily through investments in several countries. This is reflected clearly in its strong results, having generated higher revenues (+53% y/y) and earnings (+35% y/y) in 9M 2022. SWDY currently trades at TTM P/E of 6.1x and EV/EBITDA of 4.6x, which in our view is decoupled from SWDY’s fundamentals. We revisit our financial model for SWDY and revise our estimates upward, reiterating our positive view with a 47% higher 12MPT of EGP21.0/share. Thus, we reiterate our Overweight/Medium Risk rating with a 72% upside.
For the full report, please click here.
Abdelkhalek Mohammed
Equity Analyst
T +202 3300 5717
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