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MubasherTrade maintains Egypt Aluminum PT at EGP 25.98/shr

MubasherTrade maintains Egypt Aluminum PT at EGP 25.98/shr
The new expansion will bring up the firm’s production capacity to 570,000 tonnes of aluminum on annual basis
Egypt Aluminum
EGAL
-0.76% 95.27 -0.73

Cairo – Mubasher: MubasherTrade Research has maintained their a Buy/High Risk rating for Egypt Aluminum (EGAL) at a price target (PT) of EGP 25.98 per share.

 The rating for the stock includes the company’s planned expansion to add the seventh production line with an annual capacity of 250,000 aluminum tonnes, MubasherTrade said in a recent research note .

The new expansion will bring up the firm’s production capacity to 570,000 tonnes of aluminum on annual basis.

“EGAL is also planning to build a 300megawatt (MW) solar power plant which will contribute in reducing the electricity bill,” according to the research note.

The Egyptian Exchange- (EGX) listed firm noted that these projects are expected to contribute to trimming expenses, especially electricity expenditures.

“Egypt Aluminum has high sensitivity to many factors including; electricity, alumina, and international prices of aluminum (the current decline in prices negatively affects EGAL results),” MubasherTrade added.

If the company’s new expansions are ignored, the PT will drop to EGP 14.05 per share.

Egypt Aluminum’s profits plunged 61.7% to EGP 715.8 million in the first nine months of the fiscal year 2018/2019 from EGP 1.86 million in the same period a year before.