Upgrade to Overweight; caution on entry point
Share price drop overdone. We upgrade our rating to Overweight from Neutral. We see the c32% y-t-d share price drop exaggerated, putting the stock on a FY16/17e P/E of 8.6x vs. 14.3x for developed market industry peers although its 2015-17e EPS CAGR is 31%, approximately 2x consensus for peers. We lower our DCF-based EV for Pachin by 20% to EGP501mn, reflecting the higher rate environment starting March 2015, which we expect will both undermine Pachin’s revenue growth in 2HFY15/16 and its valuation as we raise our risk-free rate assumption by 100bps to 10.8%.
Paints & Chemicals Industries Company is a joint stock company which is based in Egypt. Co. is engaged in the manufacture and distribution of paints, varnishes, printing inks as well as related printing ink activities and the manufacture of animal extract products. Co. produces various types of oil-based and water-based paints for use on concrete, wood & metal which are suitable for all types of environmental conditions. Co. is also involved in purchasing and dividing land for the purpose of using or reselling and performing specialized construction works. Co.'s operations are organized along three segments: Decorative Paints, Industrial Paints and Printing Inks.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.