Edison Investment Research - Palm Hills Developments SAE (PHDC) Strong sales and improving macro outlook

Report

Edison Investment Research

Julian Roberts

Strong sales and improving macro outlook

The continued strength of the Egyptian residential property market has supported strong Q3 sales for Palm Hills and further residential project launches to come in Q416 are expected to keep the sales pipeline full in the medium term. Commercial real estate has contributed 10% to net profit over the year so far, a growing share of which is now recurring, and three commercial construction projects are due to be completed in FY17. Management plans to securitise up to EGP2.5bn of receivables to help accelerate construction and possibly to repay the syndicated loan earlier than scheduled. We have decreased our 2016 EBIT forecasts to reflect the accounting changes and delivery mix; our overall valuation is only slightly lower due to the reduced scope of three residential projects.

16/11/2016 10 EN

Underlying

Palm Hills Developments SAE

Palm Hills Development is a real estate developer in the Egyptian market, developing primarily high-end residential real estate and resort projects. Co. has acquired parcels of land in strategic locations throughout Egypt and maintains a land bank consisting of over 37.7 million square meters of land. Co. has a roster of 32 projects located nationwide and in the region. Co.'s portfolio includes the development of integrated residential communities, commercial projects and tourism destinations. Co.'s projects in residential, commercial and destination tourism are focused on building in 3 directions: Co.'s diversified land bank, creative architecture, high quality delivery and upkeep.

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EGS655L1C012 Egyptian Exchange Egypt

Provider

Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Julian Roberts

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Palm Hills Developments: 1Q23 | Solid Sales and Revenue; Net Profit Pressured by Finance Cost

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Strong sales and improving macro outlook

Palm Hills Developments: 1Q23 | Solid Sales and Revenue; Net Profit Pressured by Finance Cost

Palm Hills Developments: Concluding an Impressive Year With an Impressive Quarter

PHDC: Management Meeting Key Takeaways

International Public Partnerships - Consistently and responsibly delivering

Portobello SpA - Focus back on the operations

Intralot - Focus on business development in FY24

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