Tuesday, 2 November 2021

Meet our analyst of the week: Sigma’s Hani Amer

OUR ANALYST OF THE WEEK- Hani Amer, senior manager at Sigma Capital’s research department (Linkedin).

My name is Hani Amer and I’m a senior manager at Sigma Capital’s research department. I monitor the analysts who cover fast-moving consumer goods (FMCGs), fertilizers, petrochemicals, and healthcare. I started my career at MubasherTrade as an equity analyst and I worked with my mentor Amr Elalfy for much of my eight-year tenure there. I started off covering the banking sector, then also took on the NBFS industry. It was a huge learning experience, especially since this is where I learned how to cover companies for the research unit. I then moved to buy-side research at Concord International Investments where I covered the FMCG sector before becoming the vice president of research before moving to Sigma. I was lucky to have a number of good mentors I still look up to, including Mubasher’s Nader Arafa and Concord’s Salma Taha.

The best part of my job is the excitement of the market. It’s very dynamic and we see the impact of big events right away. In my day-to-day duties I really enjoy finding interesting stories in the companies we cover, and coming up with trading ideas that are unique.

The worst part of my job is the uncertainty. Selloffs in the market aren’t always caused by local events, but global crises, such as an increase in oil prices, are reflected as well. It can be difficult to feel that things are out of your hands. That isn’t to say that there isn’t anything happening in Egypt that’s causing a selloff, I think the potential implementation of the capital gains tax has really had an impact on trading.

My theory of investment is to really understand and believe in what you’re investing in. That means constantly staying updating with market and sector trends and how the company fits into them. But you shouldn’t stick to just one company or sector, it’s very important to diversify your portfolio, and there are a number of them that look very attractive in the coming period.

Healthcare seems like it could get my vote as a result of the universal healthcare system, while technology is very up and coming as the government pushes for financial inclusion. Other than that, the F&B is always a good defensive sector as people will always consume their products, and I’m also banking on the banking and education sectors in the coming period.

The most important factor I look at before I recommend a stock is the firm’s management. I assess their credibility by looking at their past targets and what actually materialized. It shows experience and knowledge to set ambitious, but reasonable expectations. Other than that, the sector itself has to have potential, and a story, so that the firm can use it to its advantage.

There are too many gray areas at the moment to forecast whether the EGX30 will close in the green this year. I mean, of course I hope it does [laughs], but the uncertainty in markets globally is also a reality here in Egypt. The EGX30 has been seeing a lot of fluctuations in the past period, and I think that’s a result of many things being up in the air, such as the GERD crisis that is still not resolved.

I don’t think 2022 will be the year for Egypt. There are still a lot of steps to take before we get to that point. Maybe 2023 could be that year, once everything that is still uncertain becomes determined.

The last great thing I watched was El Ens W El Nems starring Mohamed Henedy. I saw it in the cinema with the family and Henedy always makes me laugh to be honest.

I don’t really read outside of my job. I always have the newest CFA books on hand though. It keeps me updated with new techniques and helps me with my work.

In my downtime, I usually spend it with my family. We like to go to the sporting club or the mall. But freetime for myself… that doesn’t happen often thanks to the kids [laughs].


MARKET NEWS-

Obour Land’s net income grew 12% y-o-y in 3Q2021 reaching EGP 111.2 mn, according to a company earnings release (pdf). 3Q2021 revenues grew some 3% y-o-y reaching EGP 820 mn, up from EGP 795.5 mn over the same period in the previous year despite “a tough third quarter in terms of sales and cost of sales,” according to Obour Land Vice Chairman Ashraf Hamed Sherif. 9M2021 net income was also up 7% y-o-y totalling EGP 255.2 mn.

Emaar Misr reports ballooning net income in 3Q2021 to EGP 1.5 bn, up from EGP 526.6 mn in 3Q2020, according to a company earnings release (pdf). Company revenues reached EGP 3.8 bn in 3Q2021, up from EGP 1.4 bn in 3Q2020. Net income during 9M2021 reached a total EGP 2.8 bn for the real estate developer, compared to the EGP 1.2 bn recorded over the same period the previous year, while revenues from the first 9 months of 2021 reached EGP 7.6 bn, up from EGP 2.4 bn in 9M2020.

MARKET ROUNDUP-

The EGX30 rose 0.9% at today’s close on turnover of EGP 1.39 bn (9.2% below the 90-day average). Local investors were net sellers. The index is up 7.7% YTD.

In the green: GB Auto (+9.0%), Palm Hills Development (+3.5%) and TMG Holding (+3.1%).

In the red: Ibnsina Pharma (-2.8%), Egypt Kuwait Holding-EGP (-2.3%) and Abou Kir Fertilizers (-2.2%).

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