Downgrade the sector, fuel supply back
3Q15 was a turning point. We reduce our Egyptian retail cement price estimates, indicating an 8.4% drop y-o-y in 2016 (to EGP546/t, c18% lower than before), reflecting oversupply dynamics. Our previous bull call on the sector rested on the basis that fuel woes would sustain long enough for demand growth to incite price growth, because conversion to coal will take time, and because the government cannot afford to supply fuel to the sector and burn FX. Our expectations did not materialise—the supply of fuel rose and clinker capacity utilisation picked up to 84% in 3Q15 (the first time to reach this level since 4Q12) from 69% in 2014.
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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