FAB «Al Awal» Daily Cumulative Return Fund for Liquidity is re-opened now for subscription till the allowed limit is reached. To invest in the fund, please visit the nearest branch, hotline: 19977

Securities & Investment

Category: HC News

HC expects the CBE to keep interest rates unchanged

Posted on by Marwa Nakhla

  • HC Securities & Investment shared their expectations on the likely outcome of the MPC meeting scheduled February 3rd and based on Egypt’s current situation, they expect the CBE to keep interest rates unchanged.

Head of macro and financials at HC, Monette Doss commented: “Egypt’s inflation remains largely contained towards the lower end of the CBE target range of 7% (+/-2%) for 4Q22. We, however, expect inflation to average 7.0% in 1Q22, as we expect a pick up in food and gasoline prices reflecting global inflationary pressures. We continue to believe that carry trade is essential for supporting Egypt’s net international reserves (NIR). More so as demonstrated by the net foreign liability (NFL) position of the Egyptian banking sector (excluding the CBE), which increased to USD7.12bn in November from USD USD4.8bn in the previous month. Accordingly, we perceive continued pressure to maintain the current levels of Egyptian treasuries interest rate. Currently, Egyptian treasuries offer a real return of c4% (given 12M T-bill rate of 13.2%, taxes for US and EU investors of 15%, and our 2022e inflation forecast of 7.2%). Even though the US Federal Reserve might start increasing interest rates in March, US 2-year notes are expected to offer a negative real return of -2.2% given Bloomberg consensus estimates of 2022 2-year notes rate of 1.4% and average US inflation of 3.6% over 2022-23. Currently, Turkey offers a real return of 3.8% on our calculations (based on its 2-year note rate of 22.6%, zero taxes on Turkish treasuries, and Bloomberg inflation consensus estimates of 18.8% on average over 2022-23). We note that Egypt’s credit default swap (CDS) is currently at 550 bps, just above Turkey’s CDS of 527 bps. Accordingly, we believe that Egypt’s carry trade remains attractive at the current levels, and with inflation remaining within the CBE’s target range, we expect the CBE to maintain rates unchanged in its upcoming meeting.”

It is worth mentioning that, in its last meeting on 16 December, the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) decided to keep rates unchanged for the ninth consecutive time. Egypt’s annual headline inflation came in at 5.9% in December, with monthly inflation decreasing 0.1% m-o-m, reversing an increase of 0.1% in November, according to data published by the Central Agency for Public Mobilization and Statistics (CAPMAS).

The Global Green Economy in 2022

Posted on by Marwa Nakhla

Egypt & Africa now have a new responsibility for the Green Economy in 2022. Looming climate change and international negotiations over the global problem have sparked a “Green Transition” in Africa & Egypt. The United Nations IPCC, an intergovernmental panel on climate change, has recently updated its reports to state that globally, we must reach a net-zero CO2 emissions level by 2050 to begin reversing the impacts of global warming. For this reason, the green economy has seen a new surge of funding and interest in Q1 of 2022. Contact an HC Securities & Investment experts to discuss how the Green Economy of 2022 can impact your portfolio.

  • The IPCC Net Zero Emissions Goal Stimulates Innovation & Green Investment

A Task Force established by the IPCC has concluded that immediate action must be taken. That mandate has kickstarted a transition towards a new wave of green innovation. Anytime innovation is involved, lenders aren’t too far behind. Financial activities surrounding profitable green initiatives are on the rise. Emerging nations in Africa are now at the top of the list for securing funding and technology from large financial institutions. This renewed investment into the green transition has sparked interest from many banks and investment firms from around the globe. 2022 is sure to see a great deal of financial activity in the green sector from emerging nations.

  • The Growing Market For GSS Bonds

Green, social and sustainable bonds are a new trend across the globe. Many nations have issued them and the market is growing. A total of 16 nations currently issue GSS bonds, however only 1 exists in africa. Nigeria is shaping up to be a central location for investment firms, banks and private investors looking to support state-run green initiatives. As 2022 brings a transition into a net zero emissions plan, GSS bonds could provide a new source of financing for Egypt and countries in Africa.

  •  The New Assault On Fossil Fuel Subsidies

Fossil fuel subsidies have been known to promote excessive energy consumption. When energy prices are low thanks to government subsidies, both private and public organizations over consume. Fossil fuel subsidies are necessary in some places, however when they are used inefficiently it can cause some serious problems. 2022 has already shown a trend of correcting old, out of touch fossil fuel policies. Consequently, removing energy subsidies frees up additional capital to fund the green transition. We can expect this year to bring the removal of more fuel subsidies in Africa and Egypt and major investment in new green initiatives.

  • A Rapid Green Transition Is Coming

One thing is for certain, a transition is on the horizon. Egypt and Africa along with the rest of the world is on a rapid transition to a net-zero emissions point. To get there, we are seeing huge investment and initiatives from intergovernmental organizations around the globe. Smart investors and savvy entrepreneurs can potentially take advantage of this green transition to earn great returns. As Egypt and Africa become larger players on the international stage, all eyes are watching. Heading into 2022, the GDP of Africa & Egypt is on the rise. Similarly, the amount of investment being diverted into green projects is on the same trajectory. But can we reach net-zero emissions by 2050? Only time will tell.

HC expects the CBE to keep interest rates unchanged

Posted on by Marwa Nakhla

  • HC Securities & Investment shared their expectations on the likely outcome of the MPC meeting scheduled December 16th and based on Egypt’s current situation, they expect the CBE to keep interest rates unchanged.

Head of macro and financials at HC, Monette Doss commented: “Egypt’s inflation remains largely contained towards the lower end of the CBE target range of 7% (+/-2%) for 4Q22, and we expect it to average 5.8% in 4Q21. We also believe that cooling-off international oil prices reduce inflationary pressures going forward. However, given our perceived pressure on Egypt’s balance of payment (BoP), we believe carry trade remains essential for supporting Egypt’s net international reserves (NIR). This is also demonstrated by the net foreign liability position of the Egyptian banking sector (excluding the CBE), which increased to USD4.8bn in October from USD3.9bn in the previous month. Accordingly, we perceive continued interest rate pressures on Egyptian treasuries. Going into 2022, we expect yields to cool off to correct for the current mismatch of risk-free rates being higher than corporate borrowing rates. While, at the moment, we expect any interest rate cut by the CBE to lead to further decoupling between the risk-free rate and the corporate borrowing rate. In the global context, according to Bloomberg estimates, interest rates in the USA and the Eurozone are expected to normalize over 2022 from current accommodative levels, with the US two-year note expected to increase to 0.9% from 0.3% in 2021. With Bloomberg average 2022-23e inflation estimates of 2.9% for the US, the real return would be -2.0%. This Is significantly lower than Egypt’s real return of 3.3% given a 12M T-bill yield of 13.3%, our 2022e inflation forecast of 8.0%, and a 15% tax rate for US and EU investors. Turkey’s real yields are also less attractive than Egypt’s at 0.9%, given the one-year note interest rate of 14.2%, Bloomberg 2022 inflation forecast for Turkey of 13.3%, and zero taxes. That said, we believe that it is unlikely for the CBE to increase policy rates. We accordingly expect the MPC to keep rates unchanged in its upcoming meeting. ”

It is worth mentioning that, in its last meeting on 28 October, the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) decided to keep rates unchanged for the eighth consecutive time. Egypt’s annual headline inflation came in at 5.6% in November, with monthly inflation increasing 0.1% m-o-m compared to an increase of 1.5% m-o-m in October, according to data published by the Central Agency for Public Mobilization and Statistics (CAPMAS).

-Ends-

About HC Securities:

HC Securities & Investment (HC) is a leading investment bank in Egypt and the MENA region. Since its inception in 1996, HC has utilized its relationship-driven insights, local and regional market knowledge, and industry-specific expertise and strong execution capabilities to provide its clients with a wide range of services in investment banking, asset management, securities brokerage, research, custody, online trading and private equity through its offices in Egypt and the UAE (DIFC). HC Investment Banking has an outstanding track record of advising leading corporates in Egypt and the MENA region on M&A, capital market, and financing transactions in excess of USD6.2bn. HC Asset Management, winner of the 2018 MENA Fund Manager Awards, now manages 8 mutual funds for commercial banks and portfolios for institutions and sovereign wealth funds with assets under management in excess of EGP6.8bn. HC Brokerage is ranked among the top brokers in Egypt and provides a wide array of services, including research and online trading to institutional and retail clients.

HC: we expect the CBE to keep interest rates unchanged

Posted on by Marwa Nakhla

HC Securities & Investment shared their expectations on the likely outcome of the MPC meeting scheduled October 28th and based on Egypt’s current situation, they expect the CBE to keep interest rates unchanged.

Head of macro and financials at HC, Monette Doss commented: “Egypt’s inflation remains within the CBE target range of 7% (+/-2%) for 4Q22, and we expect it to average 5.9% in 4Q21. We, however, believe that rising international prices of oil and other commodities impose significant inflationary pressures domestically, especially in light of recent official announcements of the government’s intention to reduce its subsidy bill. Globally, monetary tightening is coming on the scene, with Federal Reserve officials indicating they could start tapering stimulus spending before year-end. At the same time, the Bank of England Governor recently announced that the Central Bank should act to counter rising inflation. We believe that the prospects of global monetary tightening reflected in some mild interest rate pressures on Egyptian 12-months T-bill yields, which increased by 13bps since the beginning of October. We also note that Egyptian banks’ net foreign liability position widened to USD4.44bn in August from USD1.63bn in July. This should also impose upward interest rate pressures on Egyptian treasuries, in our opinion. Currently. However, Egyptian 12-months T-bills continue to offer attractive real return of c3% (given our 2022e inflation forecast of c8% and 15% taxes for European and US investors). This is compared to c4% offered by Turkey (based on the recent 9-months T-bill rate of 18.25%, zero taxes, and Bloomberg 1-year inflation estimate of c14). That said, we expect the MPC to keep rates unchanged in its upcoming meeting. ”

It is worth mentioning that, in its last meeting on 16 September, the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) decided to keep rates unchanged for the seventh consecutive time. Egypt’s annual headline inflation came in at 6.6% in September, with monthly inflation increasing 1.1% m-o-m compared to an increase of 0.1% m-o-m in August, according to data published by the Central Agency for Public Mobilization and Statistics (CAPMAS). With the MPC due to meet on 28 October, we present our expectations on the likely outcome based on Egypt’s current situation.

HC: Orascom Construction’s lower margins warrant a lower TP, we maintain OW

Posted on by Marwa Nakhla

  • In a recent report, HC Brokerage issued an update note about Egypt’s construction sector, through shedding the light on Orascom Construction. HC reiterates OW on a still compelling valuation.

  • New business intake has recovered from COVID-19 but associated margin compression has not, as precautionary measures are replaced by global inflationary pressures
  • Other equity investments help bridge the gap until BESIX recovers
  • We cut our 2021–25e EBITDA and EPS estimates c19% and 25% and TP c22% to USD10.0/share (EGP156/share), but reiterate OW on a still compelling valuation

Mariam Ramadan, Head of Industrials at HC commented that: Business intake in Orascom Construction continues to be strong, but margin pressure is likely to stay longer: “ We are still positive on new business prospects, with the company’s project awards on track to exceed pre-COVID levels this year. In Egypt, the government continues investing heavily in megaprojects, with the new year’s budget hitting the EGP trillion mark for the first time in core sectors, including transportation, logistics, and renewable energy-based desalination. The private sector is also forecast to make a decent comeback, most notably in manufacturing, where we already see a handful of big, previously stalled industrial and petrochemical complexes start to resurface. Lately, the US market has witnessed numerous contractors face delays or cancellations on labor shortages, supply chain disruptions, and higher project costs. Still, contractors remain positive on the awaited USD1trn infrastructure package. However, with many currently forecasting the heightened commodity and energy prices and supply chain issues to persist into 2022, we opt to lower our US EBITDA margin estimates an average 0.4 pp, in line with the current level. We also reduce our MENA margin forecasts 1.6 pp, closer to the last reported figures, with which management seems content, and especially given that the building materials division performance is currently at a peak (together with the concessions represented c22% of net profit at an EBITDA margin of c24% in 1H21), in our view. It is worth noting that management had indicated potential double-digit margins for some complex mega infrastructure projects in its backlog that could provide a windfall upon completion, offering upside risk to our estimates. Other positives that have yet to reflect in our numbers include business in MENA ex-Egypt, where several memoranda of understanding (MOUs) and preliminary contracts were signed in Libya, mainly in the roads space, among other countries.”

 

“BESIX’s subdued earnings continue, but other investments hold up: BESIX has lagged our expectations and management guidance of returning to profitability last year, as it engages in further cleanups, structural adjustments and faces delays in its real estate business. While the unit’s EBITDA margin has crawled back nearly to its historical levels, its net debt (again mostly related to the real estate business) has continued to expand, weighing down on its earnings contribution. Management is confident about a positive result for the whole year, but we opt to have it breaking even this year and factor in no dividend payout next year. On the other hand, other equity-accounted investees, mostly IPPs and concessions, have started to contribute more significantly to earnings. Management sees many opportunities in the pipeline over the next few months, which often not only provide a recurring income stream but also come with a construction component.” Mariam Ramadan added.

“Maintain OW on compelling valuation: We lower our 2021–25e EBITDA and EPS estimates an average c19% and c25% respectively, leaving our TP c22% lower at USD10.0/share, or EGP156/share on the current EGP/USD rate. Our new target price puts the company on a 2022e P/E multiple of 9.9x (trading at 4.6x) and EV/EBITDA multiple of 3.5x (trading at 1.8x), implying a potential return c116% on the 18 October closing price of EGP72.6/share. Therefore, we maintain our Overweight rating. In our view, valuation remains compelling, with the share price dropping c14% YTD, underperforming the market by c18 pp.” Mariam Ramadan concluded. 

HC: Palm Hills Development… Resilient performance

Posted on by Marwa Nakhla

  • HC Brokerage issued their update about Egypt’s real estate sector shedding the light on Palm Hills Development performance and maintaining the Overweight rating.

  • Sales and construction pace are picking up despite pandemic difficulties; we positively view coastal expansions and new key management figures
  • We expect collections of EGP54.5bn over 3Q21—2030 against CAPEX spending of EGP27.7bn
  • We reduce our TP c26% to EGP2.82/share and maintain our Overweight rating as we account for the settlement of Botanica; stock is trading slightly below par value at a 2021e P/NAV of 0.45x

Mariam Elsaadany, real estate analyst at HC Brokerage commented that: “ Healthy sales growth and project expansion: We continue to see solid sales figures as the sector gradually recovers from the pandemic’s impact. In the future, we expect the real estate sector’s performance to pick up from current levels aided by the Central Bank of Egypt’s (CBE) new EGP50bn middle-income mortgage finance initiative at a declining 8% interest rate. The price ceiling of units in the initiative has been revised upward to EGP2.50/unit, and it can now finance units not registered at notary offices provided that the beneficiary can provide alternative collateral to the mortgage lender, as per the most recent amendments to the initiative. We see that PHD could benefit from the amendments to the initiative given its sizeable ready-to-move inventory. Developers have been reporting impressive pre-sales figures with Talaat Moustafa Group Holding (TMGH EY), Emaar Misr (EMFD EY), and SODIC (OCDI EY), all exceeding our FY20 pre-sales forecasts by c9%, c29% and c2%, respectively and by 4.1x, c27%, and 2.1x in 1H21. Palm Hills Developments (PHD) has been no exception, reporting healthy pre-sales numbers, aided by project expansion. In FY20, it slightly exceeded the EGP12.0bn pre-sales revised target and gave FY21 a big boost with a strong 1H21, with the company currently expecting pre-sales to increase c17% y-o-y in FY21 EGP15.0bn. Construction pace has also gained momentum with EGP2.50bn expected in CAPEX in 2021, c67% higher y-o-y as it plans to deliver 1,450 units and any excess going to its ready-to-move inventory with a value of around EGP3.2bn as of 2Q21.  We also positively perceive PHD’s recent agreement with Taaleem Management Services (TALM EY Equity) to establish a university in Badya and the expected 3Q21 delivery of residential units in the project. Given the recent change in management entailing the hiring of two co-CEOs and managing directors in May, we would not be surprised by strategic changes taking place in the company towards the end of the year, in our view. According to its chairman, decisions related to the company’s securitization program, the sale of Botanica land, and available financing options are open to reassessment by the new management team. In terms of expansions, new projects will likely be in coastal cities as management has noticed a pickup in demand in second homes since the pandemic and seeks to capitalize on it. PHD is currently working on finalizing a 0.57m sqm North Coast revenue-share project with Hassan Allam, having already launched Hacienda West, which will add more North Coast inventory. On a less positive note, some c58% of PHD’s FY2021—26e sellable inventory is in Badya, which increases the company’s concentration risk, in our view. Also, in our opinion, Badya faces competition from Orascom Development Egypt’s (ORHD EY, Overweight, TP EGP8.21/share) O West project in terms of location and pricing.”

“ We expect collections of EGP54.5bn over 3Q21–2030e against CAPEX spending of EGP27.7bn; reflecting positively on PHD’s balance sheet: Our EGP49.6bn of expected real-estate revenue recognized over 3Q21–31e includes EGP15.9bn of existing backlog, as we continue to account for only the launched phases of Badya in our forecasts, given that the project is only c5% sold. Our numbers point to an average future gross profit margin of c48% with total costs of EGP26.1bn. We expect new net contracted sales of EGP43.0bn over 3Q21–24e, which is reduced to EGP31.4bn when adjusted to PHD’s stakes in revenue-sharing projects, Badya, Palm Hills New Cairo (PHNC), Hacienda West, and Capital Gardens. We expect PHD to sell some 9,793 units over the same period, with PHNC accounting for c22%, Palm Hills Alexandria c20% and Capital Gardens c18%, and the remaining sales of the launched areas in Badya to account for c13%. Our numbers point to CAPEX spending of EGP27.7bn over 3Q21–2030e and collections of EGP54.5bn extending to 2030e. For deliveries, we expect the company to deliver 16,398 units over 3Q21–2028e. PHD is targeting EGP2.5bn worth of securitization transactions in 2021, of which it already closed an EGP1.20bn transaction in June. We estimate the company’s net debt/equity to drop to 0.37x by 2021e and to 0.25x by 2022e as its balance sheet improves due to good collections, better cash flow management, and especially in light of the low-interest-rate environment, in our view. The management is targeting to close 2021 with cash flow from operations of EGP2.00bn while we are estimating EGP1.49bn. It also targets a net debt figure of EGP1.50bn or less, while we estimate its net debt (excluding land liabilities) to reach EGP1.36bn by the end of 2021 (excluding the recently secured facility of EGP2.50bn for PHNC).” Mariam El Saadany added

The real estate analyst at HC concluded her update on PHD stating that: “We reduce our SOTP TP for PHD by c26% to EGP2.82/share and maintain our Overweight rating: Our sum-of-the-parts (SOTP) target price is lower as our model now captures the settlement on Botanica, our assumption of selling the plot as raw land over 5 years and using an average selling price of EGP2,000/sqm. This follows shareholder approval to return 50% of Botanica land (2.96m sqm) to the government and holding on to the remaining area, in addition to 1.47m sqm under registration. We only include the registered areas of 2.69m sqm as the sale of the plot yield a value of EGP1.09/share, on our estimates. We continue to include only launched areas of the Badya project in our numbers and add Hacienda West to our forecasts given its recent launch. We exclude the company’s 205-feddan West Cairo revenue-share project as PHD’s revenue-share has been revised downward to 20% from 40%. We value PHD’s real estate and hospitality businesses using a DCF methodology, which we lowered by c31% to EGP1.82/share, despite adding the company’s Ain Sokhna project, Laguna Bay, and Hacienda West in our numbers, mainly due to the extension in the collection period. The sale of Botanica and excluding PHD’s 5m sqm land bank in Saudi Arabia (we remove on lack of visibility) reduces our land valuation by c33% to EGP1.69/share. We use a 5-year moving WACC of 16.2% with a 5-year average pre-tax T-bill rate of 11.7% and a beta of 1.199. PHD’s net debt represents a negative EGP0.70/share as of 2Q21. This sums up to a target price of EGP2.82/share (down by c26% from our previous target price of EGP3.79/share adjusted to the recent capital reduction). This puts the company on a 2021e P/NAV of 0.67x (NAVPS of EGP4.22) and implies a c47% potential return over the 5 October closing price of EGP1.92/share. Therefore, we maintain our Overweight rating. In our view, the market continues to undervalue PHD’s land bank, especially after the Botanica settlement, pricing it at EGP770/sqm, which is a c53% discount to the market-implied land value of EGP1,643/sqm, on our calculations. The company trades at a 2021e P/NAV of 0.45x, and 0.42x for 2022e, and a PER of 6.82x for 2021e and 6.34x for 2022e. PHD has also announced a five-year dividend policy (which we are not accounting for in our numbers), and also announced a share buyback program as it bought 2.47% of the company as treasury shares of which it terminated 36.3m shares in June.”

HC expects the CBE to keep interest rates unchanged in the upcoming MPC meeting

Posted on by Marwa Nakhla

  • HC Securities & Investment shared their expectations on the likely outcome of the MPC meeting scheduled September 16th and based on Egypt’s current situation, they expect the CBE to keep interest rates unchanged.

Head of macro and financials at HC, Monette Doss commented: “Egypt’s inflation remains closer to the lower end of the CBE target range of 7% (+/-2%) for 4Q22, and we expect it to average 5.6% in 4Q21. We believe that the Federal Reserve’s recent announcement of unlikely interest rate hikes in the near future partly relieved the pressure on Egypt’s treasury yields by renewing the interest in emerging markets carry trade. Accordingly, Egyptian treasury bill yields declined by an average of 40 bps since mid-August, reflecting higher foreign portfolio inflows during August. Foreign holding of Egyptian treasuries increased to USD33.0bn in August from USD29.0bn in May, according to S&P Global Ratings. We also believe that a rebound in foreign currency receipts from tourism following the resumption of Russian flights to Egypt’s Red Sea resorts released some interest rate pressure on the EGP. Going forward, we believe that the interest rate action of other emerging markets will determine the pace of future declines in Egypt’s treasury yields. Currently, Turkey offers c19% on its 1-year treasuries (hence a real yield of 5.45% given zero taxes and Bloomberg 2022 inflation estimate of 13.4%) compared to Egypt’s real yield of 3.0% (given our 2022e inflation forecast of c8% and 15% taxes for European and US investors). Also. according to CBE data, the corporate borrowing rate is currently at around 9.4%, while the risk-free after-tax rate is around 10.4%. Therefore, we believe that any interest rate cuts at the moment could lead to a wider gap between the corporate and the risk-free rates, with the corporate rate being on the lower end. We accordingly expect the MPC to keep rates unchanged in its upcoming meeting.”

It is worth mentioning that, in its last meeting on 5 August, the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) decided to keep rates unchanged for the sixth consecutive time. Egypt’s annual headline inflation came in at 5.7% in August, with monthly inflation increasing 0.1% m-o-m compared to an increase of 0.9% m-o-m in July, according to data published by the Central Agency for Public Mobilization and Statistics (CAPMAS).

-Ends-

About HC Securities:

HC Securities & Investment (HC) is a leading investment bank in Egypt and the MENA region. Since its inception in 1996, HC has utilized its relationship-driven insights, local and regional market knowledge, and industry-specific expertise and strong execution capabilities to provide its clients with a wide range of services in investment banking, asset management, securities brokerage, research, custody, online trading and private equity through its offices in Egypt and the UAE (DIFC). HC Investment Banking has an outstanding track record of advising leading corporates in Egypt and the MENA region on M&A, capital market, and financing transactions in excess of USD6.2bn. HC Asset Management, winner of the 2018 MENA Fund Manager Awards, now manages 9 mutual funds for commercial banks and portfolios for institutions and sovereign wealth funds with assets under management in excess of EGP6.8bn. HC Brokerage is ranked among the top brokers in Egypt and provides a wide array of services, including research and online trading to institutional and retail clients.

 

HC Brokerage cooperates with Contact Factoring to launch the First Margin Lending Factoring Program with EGP 400 mln

Posted on by Marwa Nakhla

  • HC Brokerage signed a cooperation agreement with Contact Factoring for launching the first margin lending factoring program, aimed at financing HC retail clients interested in Margin Trading, with a total value of EGP400mm. This program will contribute in growing the trading volume in the Egyptian stock market and allows easier access to financing for retail and institutional clients.

This HC Contact cooperation comes in line with the decisions of the Financial Regulatory Authority to allow factoring companies to provide quick loans for the retail clients of brokerage companies who offer margin trading. This cooperation conveys Contact’s confidence in HC as one of the biggest brokerage companies in Egypt, based on the trading volume and array of services that HC provide to a large base of clients, both institutions and retail.

Hassan Choucri, Managing Director of HC Brokerage, affirmed that this agreement allows great opportunities for a multitude of stock market investors across all segments, by facilitating the needed financing through the first margin lending factoring program. He noted that HC concluded this deal based on its extended expertise in the stock market, as well as its strong relations with its clients and NBFS companies.

He added that “Brokerage companies mainly depended on their own resources to serve margin traders. Given the current interest in encouraging small retail investors to trade and spread the culture of stock market investments, such agreements offer great opportunities for injecting new money, where clients can trade with larger sums, which in turn increases the market liquidity and creates a better investment environment.”

 -Ends-

About HC Brokerage

  • HC Brokerage has rapidly developed into one of the top brokerage firms in Egypt. HC Brokerage provides its services to a wide client base of corporate institutions and High Net-Worth Individuals. Since 1999 HC Brokerage has developed a growing client base that has benefited from a multitude of services and a trusted team that aims for the utmost benefit and client satisfaction.
  • HC Brokerage is a subsidiary of HC Securities & Investment, one of the most distinguished investment banks in Egypt and the Middle East which was established in 1996 and has fully operational offices in Egypt and the middle east.
  • HC Brokerage provides its clients with a wide- array of services, including: Brokerage for securities listed on the Egyptian Exchange and Brokerage for Global Depository Receipts (GDRs) issued by Egyptian companies and listed on the London Stock Exchange. In addition, Brokerage for Sovereign and Corporate bonds, Intermediation for transactions involving unlisted securities in the Egyptian over-the-counter (OTC) market and listing of companies on the Egyptian Exchange. HC Brokerage also provides Online-trading services, bonds and foreign securities trading.

HC’s strategy in 2021 and 2022

Posted on by Marwa Nakhla

In an interview with Reuters, Hussein Choucri, Founder, Chairman and managing Director of HC Securities and Investment shared his views on the Egyptian economy and HC’s strategy for 2021/2022.

  • HC’s strategy: Choucri confirms that there is no intention to sell the company

  • HC is about to close two acquisitions worth a total value of EGP5bn.

  • HC’s strategy for 2022 includes working on acquisitions with EGP4bn

  • HC Brokerage aims at launching two new branches besides its eight branches.

  • In 2021, HC sealed two deals as it acted as a co-advisor for MAC Beverages Ltd and its affiliates on the sale of a 52.7% stake in Coca-Cola Egypt for $427mm.

  • HC acted as co-advisor to Saudi food giant Almarai on the acquisition of 100% shares in Bakemart UAE and Bahrain in a deal worth USD25.5bn

  • Recently, HC Brokerage signed a cooperation agreement with Contact Factoring for launching the first margin lending factoring program, aimed at financing HC retail clients interested in Margin Trading, with a total value of EGP400mm.

  • HC’s assets under management reach EGP6.8bn.

HC Securities & Investment

HC Securities & Investment (HC) is a leading investment bank in Egypt and the MENA region. Since its inception in 1996, HC has leveraged its relationship-driven insights, local and regional market knowledge, industry-specific expertise and strong execution capabilities to provide its clients with a wide range of services in investment banking, asset management, securities brokerage, research, custody, online trading and private equity through its offices in Egypt and the UAE (DIFC). HC Investment Banking has an outstanding track record of advising leading corporates in Egypt and the MENA region on M&A, capital market, and financing transactions in excess of USD 5.9bn. HC Asset Management, now manages 9 onshore mutual funds for commercial banks and portfolios for institutions and sovereign wealth funds with assets under management in excess of EGP 7bn. HC Brokerage is ranked among the top brokers in Egypt and provides a wide array of services, including research and online trading to institutional and retail clients.

HC acted as co-advisor to MAC Beverages Ltd and its affiliates (“MBL”) on the sale of their 52.7% stake in Coca Cola Bottling Company of Egypt

Posted on by Marwa Nakhla

  • HC Securities & Investments (“HC”) acted as co-advisor to MAC Beverages Ltd and its affiliates (“MBL”) on the sale of their 52.7% stake in Coca Cola Bottling Company of Egypt (“CCBCE”), as a part of Coca Cola HBC Holdings B.V (“CCH Holdings”) acquisition of 94.7% of total CCBCE’s shares for an agreed total combined purchase price of US$ [427] million, subject to certain adjustments.

The parties of Coca Cola transaction have entered into definitive agreements. The transaction is expected to closing in late Q4 2021, subject to satisfaction of various conditions, including the receipt of certain lenders consents under CCBCE’s existing loan facilities and certain regulatory and other conditions.

Mohamed Aburawi, Head of Investment Banking at HC commented: “We are pleased to support MBL on this landmark transaction. HC has developed a long term relationship with MBL for more than a decade advising MBL on a number of high profile transactions in the F&B and packaging sectors. This transaction testifies of Egypt’s attractiveness as a promising investment destination offering great business opportunities appealing to prominent international strategic investors”

End –

About HC Securities & Investment

HC Securities & Investment is a leading investment bank in Egypt and the MENA region. Since its inception in 1996, HC has leveraged its relationship-driven insights, local and regional market knowledge, industry-specific expertise and strong execution capabilities to provide its clients with a wide range of services in investment banking, asset management, securities brokerage, research, custody, online trading and private equity through its offices in Egypt and the UAE (DIFC). HC Investment Banking has an outstanding track record of advising leading corporates in Egypt and the MENA region on M&A, capital market, and financing transactions in excess of USD 5.9bn. HC Asset Management, now manages 9 onshore mutual funds for commercial banks and portfolios for institutions and sovereign wealth funds with assets under management in excess of EGP 7bn. HC Brokerage is ranked among the top brokers in Egypt and provides a wide array of services, including research and online trading to institutional and retail clients.