Cairo - Mubasher: MubasherTrade Research has upgraded their 12-month price target (PT) for Lecico Egypt to EGP 8.35 per share, with a Buy/High Risk recommendation, according to a recent report on Wednesday.

The research firm highlighted that the key risks include “any increase in energy costs, any slowdown in European economy to which Lecico exports."

“Longer-than-normal cash conversion cycle resulting in a high financial leverage, low return on invested capital versus weighted average cost of capital, no dividend distribution expected soon,” the report continued.

Lecico Egypt’s revenues hiked 88% year-on-year to EGP 633.6 million in the third quarter of 2017, beating MubasherTrade Research's estimates (MTRe) of EGP 514.7 million, the report noted.

The research firm added that it used moving cost of equity to reflect the inflation rate each year with the prevailing stability of exchange rate and the expected slowdown in inflation.

Given that Lecico Egypt last reported a net loss of EGP 3.03 million in Q3-17, against EGP 46.8 million in the prior year period.

By 1:43 pm Cairo time, Lecico Egypt’s stock rose 2.39% to EGP 5.99.