Egyptian Exchange benchmark EGX 30 index climbed by 4.97 % this week, representing an increase of 236.32 points, ending Thursday transactions at 4,989.44 points compared to 4,753.12 points at the end of last week. Regarding current week trading, the index hit its highest point on Thursday closing at 4,989.44 points, where its lowest point recorded on Sunday at 4,758.84 points. EGX30 started week in positive sentiment and edged higher by 0.12 % to close at 4,758.84 points on Sunday. Market trade volume reached 140,485,486 shares amounted to EGP 189,377,196. EGX30 extended positive sentiment after reversing early loss and edged higher by 0.15 % to close at 4,765.88 points on Monday. Market trade volume reached 182,717,731 shares amounted to EGP 576,288,191. The index extended green performance for the fourth consecutive session and advanced by 2.03 % to close at 4,862.53 points on Tuesday. Market trade volume reached 198,463,729 shares amounted to EGP 482,256,040. EGX30 extended green area for the fifth consecutive day ahead of announcing the new government and advanced by 1.5 % to close at 4,935.59 points on Wednesday. Market trade volume reached 200,547,212 shares amounted to EGP 406,995,130. The EGX benchmark extended green area for the sixth consecutive day ahead of announcing the new government and advanced by 1.09 % to close at 4,989.44 points on Thursday. Market trade volume reached 196,557,970 shares amounted to EGP 461,343,432. EGX-Listed Firms' Weekly Performance Highlights: Egyptian Financial Group-Hermes Holding Company - (HRHO.CA) stock closed last week at EGP 10.75, while closed on Thursday at EGP 10.79, upping by EGP 0.04. The highest close during that week came on Wednesday closing at EGP 10.81, while the lowest came on Monday at EGP 10.55. On July 24th, the Egyptian Financial Supervisory Authority (EFSA) suspended EFG-Hermes joint venture deal with QInvest. The EFSA rejected decisions approved by EFG shareholders last month because the firm did not clarify points including minority rights. Dr. Ashraf Al-Sharkawy, EFSA Chairman, was quoted as saying that EFG-Hermes must provide the required information and reconvene shareholders meeting for the deal to be completed. Following the Egyptian financial regulator's call for additional disclosures related to minority shareholders, Mona Zulficar, EFG-Hermes Board of Directors chairperson, told Zawya Dow Jones on the beginning of this week: “The deal has not been suspended by EFSA. Only additional disclosures have been required. Hence no appeal is required." Later on Monday, Mona Zulficar, EFG-Hermes Board of Directors chairperson, said Hermes BOD has not discussed dividend distribution yet as such a matter shall be determined after its business lines; securities brokerage, asset management, investment banking, private equity and research announce their business results. Zulficar mentioned that the additional disclosures required by the Egyptian Financial Supervisoy Authority (EFSA) would not affect EFG-Hermes' joint venture deal with QInvest. “Hermes' ESM had approved by majority to go through its deal with QInvest. " Zulficar added She noted that EFSA has the right to require some additional disclosures on the shareholders and the fate of the minority's rights. Referring to an alternative offer made by Planet IB, a consortium of investors, Zulficar said: “Planet IB file has, to our knowledge, been closed as they did not file any tender offer applications with EFSA." Commenting on the complete mystery which surrounds QInvest deal, Zulficar noted: “We don't have something to hide behind the scenes; EFSA can require any further disclosure on our deal with QInvest." Zulficar mentioned that after receiving EFSA's approvals beside of other regulators in Arab countries where Hermes has activities, it is expected that QInvest deal will be concluded by the end of the third quarter of 2012. On Tuesday, Zulficar asserted that signing the joint venture deal with QInvest has no causal connection to Al Watany Bank of Egypt (AWB) case in which two Hermes CEOs face charges. “The main reason behind signing this deal with QInvest is the decline in the profits of Securities Brokerage and Asset Management due to the current circumstances." Zulficar added “The deal has been signed on the purpose of ensuring shareholders' interests." Moreover, Zulficar noted that upon Egyptian Financial Supervisory Authority (EFSA)'s request, EFG-Hermes will be reconvening its shareholders' annual meeting within a week or a maximum of 10 days. “During this meeting, we will provide some additional more detailed disclosures on the QInvest deal and the fate of the minority's rights after signing the deal ... we don't have something to hide behind the scenes." Ezz Steel – (ESRS.CA) closed last week at EGP 7.29, while closed on Thursday at EGP 7.57 (highest), upping by 4 % (EGP 0.28). Stock lowest close during the week came on Monday at EGP 7.34. The Egyptian stock market froze trading on shares of Ezz Steel Tuesday until the company responds to the stock market's inquiries regarding a report that a bank had stopped disbursing around US$148 million for the company. Steel tycoon Ahmed Ezz, owner of the group, is currently held in Tora prison on corruption and profiteering charges. On Wednesday, Kamel Galal, Investor Relations Manager at Ezz Steel, denies a report that banks had stopped disbursing the remaining installments of a loan for the company amounting to around $148 million, Almal newspaper reported. He pointed out that, the cash flows and loan installments the company is getting continuous normally, adding that the company was not informed about any freeze of it. Credit Agricole Egypt - (CIEB.CA) closed last week at EGP 9, while closed on Thursday at EGP 9.1, representing an increase of EGP 0.1 (1 %). Stock highest close during the week came on Wednesday at EGP 9.51, while the lowest level recorded on Sunday closing at EGP 9.09. On Monday, Credit Agricole Egypt BOD approved consolidated financial results for the fiscal period ending in 30 June 2012 with net profits after taxes of EGP 264.28 million, compared to EGP 140.73 million in the comparable period. On Wednesday, EFG-Hermes set Credit Agricole Egypt rating at Neutral after the bank issued a press release with a few financial indicators for 2Q2012. Hermes stated that, bank's net profit stood at EGP137 million, up 8% Q-o-Q and 68% Y-o-Y, outperforming our estimate of EGP109 million by 26%, we believe most likely due to lower-than-expected provisioning. Detailed financial statements are not yet available. It added that, it has a Neutral rating on CAE, reflecting our concern that its earnings are the most sensitive of the Egyptian banks we cover to credit quality deterioration due to: (i) CAE's weaker operating profitability; and (ii) its weaker capacity to absorb a provisioning shock. These preliminary figures suggest, however, that credit quality has not materially worsened in the period to June 2012. Sidi Kerir Petrochemicals (SKPC.CA) closed last week at EGP 12.41, while closed on Thursday at EGP 12.37 (highest close), edging lower by EGP 0.04. Stock lowest close during the week came on Tuesday at EGP 12.2. On Monday, Sidi Kerir Petrochemicals BOD approved financial results for the fiscal period ending in 30/06/2012 with net profits after taxes of EGP 331.715 million (unaudited), compared to EGP 470.828 million. On Tuesday, EFG-Hermes reiterated Sidi Kerir Petrochemicals Buy rating after reporting financial results for the second quarter of 2012. Hermes stated that, the company released 2Q2012 results headlines showing a significant 37 % Q-o-Q decline in net income as a result of the maintenance shutdown. It added that, the company posted net income of EGP129 million was 6% below our estimated EGP137 million, likely on tax adjustments (net income before tax was only 2% shy of our estimate). Operational results were just in line with our forecast, with revenues dropping 25% Q-o-Q to EGP394 million and gross profit declining 32% Q-o-Q to EGP175 million. Despite the expected weakness in 2Q2012, we continue to see value in Sidpec, which trades at a significant discount to peers at 9x 2012/13e P/E and an attractive dividend yield of 13%. Finally, it expects 2012's overall PE utilization rates at 90%, maintaining our 2012 EPS estimate at EGP1.42 per share. Heliopolis Housing (HELI.CA) closed last week at EGP 14.82, while closed on Thursday at EGP 15.07, upping by 2 % (EGP 0.25). Stock highest level recorded on Wednesday closing at EGP 15.43, while the lowest came on Monday at EGP 14.63. On Wednesday, Heliopolis Housing reported financial results for the fiscal year 2011/2012 with net profits after taxes of EGP 108.434.000, compared to EGP 125.625.000 profits in the comparable period. On Thursday, Eng. Ali Moustafa, Managing Director for Executive Affairs and Vice CEO of Heliopolis Housing, revealed that the company started executing Maryland project last month. He added that, the project contractor started after removing the remains of the previous project. He expected that, the project will be completed within 18 months starting from now, pointing out that the project will not include many construction works as it depends on light buildings and landscapes. Sectors Performance: The most active sectors all through the week were Telecommunications, Construction & Material, Financial Services, Banks and Real Estate. Telecommunications sector achieved total traded value of EGP 520,682,540. Construction & Material came second in terms of performance, as it achieved total traded value of EGP 286,930,054. Financial Services sector ranked third in terms of performance, as it achieved total traded value of EGP 254,317,984. Regarding, Banks it achieved total traded value of EGP 235,695,888. Finally, Real Estate, as it achieved total traded value of EGP 175,396,219. Investors' Activity: Local investors led the market activity all through the week, followed by Foreign and Arab investors respectively. Foreign investors were the most active buyers this week earning the value of EGP 78,019,677. Arab investors were most active sellers this week by the value of EGP 72,468,856. Local investors chose also to sell by value of EGP 5,550,821. Retail & Institutions' Activity: Retail activity led the market all through the week as it ranged between 38.14 – 81.40 %. While Institutions activity ranged during this week between 18.59 – 61.85 %.
