An opinion poll conducted by Daily News Egypt on the expected initial public offerings (IPOs) during 2022, revealed that three government IPOs and another three private ones are expected this year.
The first quarter (1Q) of this year will witness two offerings, one from the public sector and the other from the private sector. The first of which is Macro Group for Pharmaceuticals, which is expected to be offered in February, the second is the IPO of the state-owned football company, Ghazl El-Mahalla SC.
Mohamed Omran, the Chairperson of the Financial Regulatory Authority, expected the shares of Macro Group for Pharmaceuticals to debut on the stock exchange (EGX) this month.
He added that the list of propositions includes the offering of Ghazl El-Mahalla SC Company, which will be its first time under the public subscription system. “There is also another company which is currently communicating with the authority to complete its offering on the EGX under the public subscription system during the coming period,” he revealed.
Omran expects that 2022 will witness a large number of IPOs.
“Companies affiliated with the Egyptian Armed Forces are expected to be offered this year, in addition to the government IPO programme and the private sector’s offerings.
Mohamed Maher, the CEO of Prime Holding — which is responsible for the offering — said that the procedures for offering Ghazl El-Mahalla SC on the EGX are expected to be completed by the end of February or March at the latest. He added that the IPO will be incorporated as a new company with an initial capital of EGP 200m.
The remaining unissued capital in the offered shares will come in the form of an in-kind contribution from the Misr Spinning and Weaving Company.
Moreover, sources closely related to the offering of the Ebtikar for financial services said that the company’s IPO is expected after the Eid Al-Fitr holiday (in May), as an agreement is currently underway with an independent financial adviser to prepare fair value studies.
Also, the company is awaiting the approval of the relevant authorities regarding the implementation of the Vodafone deal, which completed its due diligence checks.
Among the private sector companies expected to be listed on the Egyptian Exchange during the second half (2H) of 2022 is Abu Auf.
Also, sources told Daily News Egypt that the government IPO programme will witness the offering of three other state-owned companies’ shares in the EGX before the end of the current fiscal year. The government IPO programme resumed with the e-finance IPO in 2021, following a long hiatus after selling a secondary stake in the Eastern Company in March 2019.
Besides Ghazl El-Mahalla SC, Banque du Caire is the most prominent of these IPOs, and it is expected to be completed during 2H of 2022.
It is worth noting that Qalaa Holding has announced the postponement of the listing of TAQA Arabia on the EGX again to 2023 when market conditions are expected to improve.
TAQA Arabia was supposed to debut in 2020, however, the company postponed the offering to 2021 and then decided last week to postpone it again till next year.
Followers of the Egyptian financial markets have always wondered when can Egypt catch up with global financial markets in terms of the number and sizes of IPOs.
Recently, Arab stock exchanges have witnessed more IPOs compared to EGX; after a disappointing year for Egyptian IPOs, dealers are waiting for a new year with better investment opportunities.
The EGX only witnessed 3 offerings in 2021 with a value of EGP 7.95bn, including two companies in the main market and another in the small projects market, with little growth compared to 2020, which witnessed 1 offering of EGP 200m.
Last year, the EGX witnessed the offering of e-finance, which debuted with 1.6bn shares with a value of EGP 5.84bn, along with Taaleem Management Services with 730.3m shares with a value of EGP 2.1bn. While the IPO of Emerald for Development and Project Management in the SMEs market with 425m shares worth EGP 57.6m.
Emerald Real Estate Investment Company was also offered on the Nile Stock Exchange with a value of EGP 200m.
Looking over the past year, global IPOs witnessed their best performance in 20 years, with 2,388 deals worth $453.3bn, according to data released by Ernst & Young, increasing deals by 64% year-on-year (y-o-y). Issuance revenue also jumped by 67% y-o-y.
The US continued to dominate the global IPO markets, as it acquired about 80% of all deals in the Americas region, which contributed to an increase in the number of regional deals by 87% y-o-y to 528 deals, while the value of issuances amounted to $174.6bn.