State-owned fintech firm E-Finance is looking to raise up to EGP 3.6 bn (USD 229.2 mn) from its upcoming IPO in what would be the biggest offering on the EGX in years. The company has set an indicative price range of EGP 12.50-13.98 per share, according to a statement (pdf) on Thursday, valuing the company at up to EGP 22.37 bn (USD 1.42 bn).

The sale: E-Finance will offer almost 258 mn shares to the public, 80 mn of which will be sold by existing shareholders and 177.8 mn will be new shares offered as part of a capital increase. The sale represents a 14.5% stake in the company; expect to learn more about the split between institutional and retail shareholders when the company prices the offering.

The timeline: Bookbuilding should finish on 9 October after which the company will announce the final IPO price. The retail offering will run from 6 October to 13 October. Trading will begin on 18 October.

Regulator gives the all-clear: The Financial Regulatory Authority gave it final sign-off for the sale in September, the statement said.

The financials: The digital payments firm recorded net earnings of EGP 352 mn in 2020, up 30% from 2019, according to figures included in its intention to float. Its top line, meanwhile, grew to EGP 1.2 bn last year, good for a 2018-2020 CAGR of 30%; profits grew at a CAGR of just over 41% in the same period. The company looks set to beat that growth rate again this year if its 2021 figures are anything to go by, reporting EGP 276 mn in net earnings in 1H2021 on EGP 904 mn in revenues.

Future plans: The proceeds of the IPO will be used to fund the company’s expansion, including in its tax services business E-Tax and a newly-formed digital health services platform E-Health, Chairman Ibrahim Sarhan told us last week

Advisors: Renaissance Capital, CI Capital and Al Ahly Pharos are quarterbacking the transaction as co-lead managers. NI Capital is acting as the IPO advisor for the listing. Zaki Hashem & Partners has been appointed as counsel to e-Finance, while Norton Rose Fulbright is acting as US counsel to the co-lead managers. Inktank is the investor relations advisor.

A litmus test: Other companies readying themselves to go public on the EGX will be watching E-Finance’s IPO closely. Ebtikar has said it could make its debut this quarter while Macro Group, which postponed its IPO in April, is also waiting in the wings. EGX boss Mohamed Farid had expected 5-6 IPOs this year, after delays in 2020 thanks to the pandemic.

This will be the EGX’s second IPO of 2021, following higher education outfit Taaleem’s debut in April. LSE-listed healthcare player IDH also completed a technical listing, transferring 5% of its shares from London to the EGX in May.