Initiate with OW; Earnings rerate not fully priced-in
A play on Egypt’s improved trade profile. ALCN, the only Egypt-listed port operator present through two concessions (covering 60% of Egypt’s seaborne trade), with volumes fully exposed to O&D1 cargo vs. DP World where 30% of volume is transhipment. This positions ALCN as a direct play on Egypt’s improved trade competitiveness given it has sufficient capacity (last recorded utilisation level was 58% for 8M16/17) to absorb more volumes. At 12.3x 2016/17e P/E, the stock trades c18% below peers, in spite of its robust 2017- 19e EPS CAGR of c18% and a strong net cash position of 1.2x FY16/17e EBITDA. The need to comply with the EGX’s 5% minimum free float should be well-received, boosting stock liquidity.
Alexandria Container and Cargo Handling Company SAE. Alexandria Container and Cargo Handling Company SAE is an Egypt-based public shareholding company engaged in the marine port services sector. The Company specializes in container and cargo handling in Egyptian ports. The Company offers a range of maritime services, including stevedoring and storage, security, tariff of both domestic and foreign trade, and transshipment container handling in the East Mediterranean. The Company operates the following terminals, namely Alexandria container terminal at the port of Alexandria and ElDekheila terminal at the port of Dekheila. The Company's terminals comprise of import and export yards, hazardous yard, operations building, security building, workshops, storage areas, customs areas and fuel stations.
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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