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PHDC - Palm Hills Developments News Story

$5.1 0.0  0.0%

Last Trade - 04/04/18

Sector
Financials
Size
Micro Cap
Market Cap £14.6m
Enterprise Value £213.6m
Revenue £235.4m
Position in Universe th / 1824

RCS - Palm Hills Develop - Edison issues update on Palm Hills Developments

Wed 16th November, 2016 3:57pm
RNS Number : 3776P
Palm Hills Developments S.A.E.
16 November 2016

London, UK, 16 November 2016

Edison issues research update on Palm Hills Developments (PHDC)

The continued strength of the Egyptian residential property market has supported strong Q3 sales for Palm Hills and further residential project launches to come in Q416 are expected to keep the sales pipeline full in the medium term. Commercial real estate has contributed 10% to net profit over the year so far, a growing share of which is now recurring, and three commercial construction projects are due to be completed in FY17. Management plans to securitise up to EGP2.5bn of receivables to help accelerate construction and possibly to repay the syndicated loan earlier than scheduled. We have decreased our 2016 EBIT forecasts to reflect the accounting changes and delivery mix; our overall valuation is only slightly lower due to the reduced scope of three residential projects.

We maintain our previous valuation approach, where we take Q316 reported NAV of EGP2.58 per share and add the potential uplift of EGP1.81 (unchanged) in valuation of undeveloped land and the hotel assets, and then add the NPV of future profits from residential development of EGP1.33 (was 1.60). The decrease in the last component is due to the reduced scale of certain projects and using a slightly higher discount rate. The resulting total valuation is EGP5.73 (was EGP6.14).


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All reports published by Edison are available to download free of charge from its website: www.edisoninvestmentresearch.com

About Edison: Edison is an international equity research firm with a team of over 70 analysts, investment and roadshow professionals and works with both large and smaller capitalised companies, blue chip institutional investors, wealth managers, private equity and corporate finance houses to support their capital markets activity. Edison provides services to more than 420 retained corporate and investor clients from offices in London, New York, Frankfurt, Sydney and Wellington. Edison is authorised and regulated by the Financial Conduct Authority.

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