Report
Taher Seif
EUR 73.88 For Business Accounts Only

GLOBAL TELECOM HOLDING - Re-initiation of Coverage

​We re-initiate our Coverage for Global Telecom with a “Buy” rating, as the stock offers 28% upside potential, driven from fair value of EGP 9.59/share (USD 0.51/share). We valued GTH using sum-of parts discounted cash flow (DCF) valuation methodology. Algeria, Pakistan and Bangladesh contribute to our estimated free cash flow with 34%, 46% and 20% respectively. We believe that in terms of trailing and leading EV/EBITDA, GTH is found significantly discounted compared to MENA region peers. As GTH is traded at trailing and leading EV/EBITDA of 2.69x and 2.62x compared to MENA region average of 7.64x and 5.9x, thus we think the stock offers deep value, when compared to the regions peers. GTH operations are located outside Egypt; diversifying away the FX risk that exists currently in Egypt post floatation. Hence GTH benefits from EGP depreciation, as the company reports its financial statements in USD, accordingly our fair value will be translated in to higher value in EGP terms, as we account for the company figures using USD in our model.

Underlying
Global Telecom Holding

Provider
Prime Group
Prime Group

Since its founding in 1992 as a privatization consulting office to the government of Egypt, Prime has successfully reinvented itself as a regional investment bank with a presence in major Arab markets. We provide innovative and outstanding financial services to corporations, institutions, governments, and individuals, using the breadth of our expertise to enable them to reach their objectives.

Over the years, we have refocused our business and our people while extending our geographical reach and strengthening our technological capabilities.

Today, Prime is:

  • A competitive leader in the region
  • Focused on both clients and products
  • Led by pioneers who see change as an opportunity that constructively challenges the status quo
  • Driven by a fearless and unconditional commitment to delivery and performance
  • Supported by a culture that emphasizes teamwork and a sense of urgency


Analysts
Taher Seif

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