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OKAZ raises Sidpec TP to EGP20.42/share

OKAZ raises Sidpec TP to EGP20.42/share

OKAZ Stock Brokers & Investment Consultants said in a report it raised the target price estimate for Sidi Kerir Petrochemicals (Sidpec) from EGP 14.68 to EGP 20.42, upgrading the stock recommendation to Buy from Hold.

The company’s revenues are expected to rise by a five-year CAGR of 2.4% during 2014-2018. FY14 topline is forecasted to decline by 5.3% to EGP 2.919 billion due to a drop in production and sales volumes, which offset the positive rise in sale prices, said Enas Salama, technical analyst, OKAZ.

The analyst also expected revenues to rise by 10% to EGP 3.2 billion in 2015 powered by projected rise in sales and continued rise in prices.

“The company’s net profit will likely slip by 20.1% to EGP 1.037 billion in 2014, then rise by 15.8% to EGP 1.2 billion in 2015,” said the analyst.

Sidpec had posted EGP 726.4 million net profit for the first nine months of FY14, with a decline by 26% year-over-year from EGP 985.1 million.