Week ending July 10, 2020

Local Pick-up

Egypt’s Net Foreign Reserves Rise for the First Time Since COVID-19

For the first time since the coronavirus pandemic, we see our international reserves go up to USD 38.2 B from USD 36 B in May. This was on the back of proceeds from the IMF’s USD 5.2 B SBA agreement. (Source: Bloomberg)

STC completes due diligence on Vodafone Egypt, will they announce an offer on July 15?

STC signed a non-binding MoU with Vodafone Group for a 55% stake of the company in March. They’ve extended the agreement for three months, citing “logistical challenges” caused by the pandemic.

Saudi Telecom (STC) have concluded their due diligence on the potential USD 2.4 B deal. We are yet to see if the STC will announce their offer on July 15 or request another extension. (Source: Enterprise)

Eni, BP, Total make discovery in the conventional Egyptian waters of the Nile Delta. 

Eni, BP and Total discover a 152m thick gas column with “excellent petrophysical properties” in their first exploration well drilled in the conventional Egyptian waters of the Nile Delta. They aim to “fast track” production through synergies with the area’s existing infrastructures.

The gas column will be tested for production and so far shows significant gas and gas condensate potential.  (Source: ENI)

Global Pick-up

Tesla is now the most valuable car company on Earth

Elon Musk claims the title of  “CEO of the world’s most valuable car company”

Tesla is now the most valuable car company on Earth with a market cap of around USD 224 B. After years of quarterly losses, Tesla has delivered 3 profitable quarters in a row with its stock going up more than 200% in 2020. Naturally, investors are loving this, and are buying the stock in hope of future profit growth.

Tesla is now selling a pair of short shorts on its website as a joke at investors who “shorted” the company, betting on its stock falling. Tesla is selling these shorts for  USD 69.420 (yes, you read that right)

Topic of the week – Incremental Investing

Compounding: When you make gains on your investment, this surplus money can be reinvested to further increase your earnings.

Cost Averaging – ECA: When investments happen in regular increments, the investor captures prices at all levels, from high to low. These periodic investments effectively lower the average cost per share.

Company of the week – Telecom Egypt

Industry: Telecom

Key Employees:

  • Magued Osman – Chairman
  • Adel Hamed – Managing Director & CEO

Year of Establishment: 1854

Number of Employees: 4,500

Service Offering: Fixed Voice, Fixed Broadband, Mobile and Directory

About:

Telecom Egypt is the first telecom operator in Egypt to provide all telecom services to its customers including fixed, mobile voice, and data services.

Telecom Egypt has a long history serving Egyptian customers for over 160 years. They have maintained a leadership position in the Egyptian telecom market by offering the most advanced technology, reliable infrastructure solutions, and the widest network of submarine cables.

The company rebranded the retail business to WE in 2017 with the launch of mobile services. The company also owns a 45% stake in Vodafone Egypt.