The Egyptian Exchange has managed to post losses of EGP 7.2 billion in week amid witnessing a series of accidents as a result of government's negligence accumulative over years. The capital market has hit EGP 380.769 billion at the end of last week, compared to EGP 387.976 billion at the end of a week earlier. Benchmark EGX 30 index retreated by 1.62% this week, representing a decrease of 93.26 points, ending Thursday's sessions at 5661.25 points compared to 5754.51 points at the end of last week. EGX30 hit its highest point on Monday's closing at 5738.96 points; while its lowest point recorded on Tuesday's at 5657.08 points. Meanwhile, the mid- and small-cap index, the EGX70 sank by 5.6% closing at 467.9 points during Thursday's session, compared to 495.88 points at the end of a week earlier. Price index EGX100 pushed down by 3.8% concluding Thursday's session at 800 points, compared to 832.14 points during a week earlier. The EGX has recorded volume of trades hit 390.5 billion securities, compared to 592 million a week earlier; while the traded value reached EGP 1.5 billion, compared to EGP 2.2 billion a week earlier. Wael Abdul Azim, technical analyst at United Brokerage Corporation, said besides the EGP 7.2 billion, the EGX's last week trading has also witnessed a decline in its volume of trades which means the EGX was going through corrective dip during last week and it will manage to push up within the coming week. Companies' Weekly Performance: Orascom Construction Industries (OCIC.CA) closed last week at EGP 265.2, while closed on Thursday at EGP 267.17, upping by 1 % (EGP 1.67). Stock highest close during the week came on Monday at EGP 269.59, while the lowest close came on Sunday at EGP 264.82. On Sunday, Chairman of Egyptian Financial Supervisory Authority (EFSA) stated that companies which will be split according to its book value will be exempted from capital tax, Almal newspaper reported. Splitting by book value doesn't produce change in company's values or capital profits, so there will be no capital taxes; Dr. Ashraf El Sharkawi said. It is worth noting that, General Authority for Investment and Free Zones (GAFI) approved OCI splitting fertilizers segment from construction through book value. On Monday, CI Capital resumed OCI coverage with a Neutral rating and a 12-month Target Price of EGP300. CI Capital stated that, OCI's US fertilizer investment is a coherent move to capture structural shift in global nitrogen production economics. It added that, backlog of construction unit (c23% of valuation) has troughed and growth potential ahead is strong, but being dwarfed by fertilizer unit. Finally, it pointed out that the improved regulatory and operating backdrops in Egypt would bring upside in share price. On Thursday, OCI is studying to compete over bids offered in Iraq next June to establish a number of Government-based and private sector hospitals, Alborsa newspaper reported. Ahmed Al-Sari, Vice Chairman for Business Development at OCI, stated that the estimated cost of each hospital is $ 80 million. He added that, the company is also considering to compete over a number of projects in Algeria, Saudi Arabia, Qatar and South Sudan in in medical and infrastructure sectors. Six of October Development & Investment Co. (SODIC ) - (OCDI.CA) closed last week at EGP 21.39, while closed on Thursday at EGP 20.65 (lowest close), dipping by EGP 0.74 (3 %). Stock highest close during the week came on Monday at EGP 21.39. On Tuesday, SODIC announced that it would guarantee the EGP 120 million loan, offered to its 99.99 % owned SOREAL Co., from Arab Investment Bank. SODIC sent a release to EGX stating that this loan will be directed to complete construction works of Qatamya Plaza project and will be paid back in 4 years. On Wednesday, SODIC announced the delivery of the first of nine buildings in Westown's Forty West neighborhood to Dar Al Handasah, one of the region's leading and most respected design and architectural consultancy firms. The company added, in a press release that, these units were delivered to Dar Al Handasah on 26th December 2012. “It is a huge testament to Forty West that Dar Al Handasah selected this particular development. Dar Al Handasah is widely recognized as one of the region's leading and most respected design and architectural consultancy firms, and their decision to collaborate with SODIC in Forty West signifies it as the premium residential destination of choice," commented Maher Maksoud, CEO and Managing Director, SODIC. Also on Wednesday, EFG-Hermes upgraded SODIC earnings in 4Q2012 to EGP 33 million, up from previous forecast of EGP24 million. Moreover, it upgraded revenue forecast to EGP 376 million, up from EGP 350 million expected previously. It added that, the first deliveries of Forty West took place at end of December 2012 and are likely to boost the company's 4Q2012 top-line. Hermes expects that the company to close FY2012 with gross pre-sales of EGP1.9 billion and cancellations of EGP166 million. We expect FY2013 gross pre-sales of EGP1.2 billion and cancellations of EGP150 million. We think that unit delivery across SODIC's projects is likely to boost pre-sales levels and encourage the company to launch new phases on its West Cairo land. Talaat Moustafa Group (TMG) (TMGH.CA) closed last week at EGP 4.65, while closed on Thursday at EGP 4.32 (lowest prices), representing a retreat of EGP 0.33 (7 %). The highest close during the week came on Sunday at EGP 4.6. On Sunday, EFG-Hermes stated that it expects Madinaty's land case appeal will be accepted. Hermes stated that, the Supreme Administrative court will soon rule whether to accept or reject the appeal in Madinaty case. If the appeal is accepted, the Supreme Administrative Court will transfer the case to another court which will study the contract in detail to assess its validity. We think that under such a scenario, it could take up to eight to twelve months before the court issues a final verdict. If the appeal is rejected, the case will be concluded in favor of TMG. We think that further delays in the case are likely to increase the company's share price volatility over the coming few months. Nonetheless, we believe the downside risks stemming from a potential land revaluation or a need to reinstate the contract again (if the appeal was accepted and the November 2011 verdict was indeed invalidated) are limited and are already priced in, in our view. Meanwhile, ongoing currency concerns could stimulate additional demand for residential units in the medium term, with Egyptian real estate being traditionally perceived as a safe haven. On Tuesday, TMG announced that it signed Madinaty contract according to legal terms, pointing out that it legal position is stable. The company added, in a release responding to EGX inquiries considering to news of Hisham Talaat Moustafa's paying bribe to Ibrahim Soliman in order to facilitate signing the contract that, it has no relation to this news. On Wednesday, TMG announced that Appeals Department decided today 16/01/2013 to refer Madinaty land contract case to Supreme Administrative Court on 16 April 2013 session. Regarding Investors' Activity: Local investors led the market activity all through the week, followed by Foreign and Arab investors respectively. Arab investors were the most active buyers this week earning the value of EGP 28,606,018. Foreign investors chose also to buy by value of EGP 20,082,171. Local investors were most active sellers this week by the value of EGP 48,688,189. Retail & Institutions' Activity: Retail activity led the market all through the week as it ranged between 47.86 – 69.09 %. While Institutions activity ranged during this week between 30.90 – 52.13 %.
