Fragile outlook explains discount; initiate at Neutral
Cheap for a reason. We initiate coverage with a Neutral rating (vs. a consensus Buy) on air travel service provider Al Tayyar Travel Group (ATG) on the grounds of a negative earnings outlook and risks related to M&A in hospitality. The stock price fell 48% y-t-d, implying a 2016e EV/EBITDA of 5.3x—a 36% below global peers explained by a 2015-17e EBITDA CAGR of - 5.5% vs. 14.3% for the industry. Scope for further downgrades, in our view, outweighs the likelihood of upward revisions.
Seera Group Holding, formerly Al Tayyar Travel Group Holding Company SJSC, is a Saudi Arabia-based company engaged in the travel, tourism and transportation sector. The Company's services include reservation, ticketing for domestic, regional and international flights, follow-up and confirmation of reservation, ticketing for land, sea and train transportation facilities, hotel booking, furnished apartments and hotel rooms. In addition, the Company organizes tourism services, such as incentive trips, Hajj and Umrah programs, honey-moon trips, medical and educational programs, as well as conference and meeting services. The Company also provides land, sea and air transportations means to a range of Saudi Arabian urban and rural centers, along with land, marine and air cargo services, issuance of (Triptick) customs pass, international driving licenses, customs clearance for goods and commodities, as well as packing and insurance, among others.
CI Capital is a diversified financial services group and Egypt’s leading provider of leasing, microfinance, and investment banking products and services.
Through its headquarters in Cairo and presence in New York and Dubai, CI Capital offers a wide range of financial solutions to a diversified client base that include global and regional institutions and family offices, large corporates, SMEs, and high net worth and individual investors.
CI Capital leverages its full-fledged investment banking platform to provide market leading capital raising and M&A advisory, asset management, securities brokerage, custody and research. Through its subsidiary Corplease, CI Capital offers comprehensive leasing solutions, including finance and operating leases, and sale and leaseback, serving a wide range of corporate clients and SMEs. In addition, CI Capital offers microfinance lending through Egypt’s first licensed MFI, Reefy.
The Group has over 1,700 employees, led by a team of professionals who are among the most experienced in the industry, with complementary backgrounds and skill sets and a deep understanding of local market dynamics.
CI Capital has been recognized as the “Best Investment Bank in Egypt” by EMEA Finance for four years running from 2013-2016, and by Global Finance in 2014 and 2015.
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