NI Capital, a subsidiary of the National Investment Bank, has chosen an independent financial advisor to assess the fair value of Heliopolis Company for Housing and Development (HHD), one of the largest real estate developers in Egypt, sources have told Daily News Egypt. The evaluation has been completed and the results are expected to be announced soon.
The sources said that the evaluation process has estimated the HHD’s value at around EGP 20bn, while the current market capitalization of the company is about EGP 15.9bn.
The sources added that the fair value per share is higher than the market price by several pounds, and close to the trading price. The HHD share closed at EGP 11.88 on Tuesday.
The sources explained that the company is among the list of companies that the government intends to divest from, even though it was not included in the list of 32 companies announced for the government IPO programme. This is because the company is already listed on the Egyptian Exchange. The government prioritizes its stakes in companies that are easier to sell, including several listed companies.
The sources revealed that there is interest from local and Gulf investors in the company due to its large land portfolio. The government, represented by the Holding Company for Construction and Development (HCCD), owns a stake of about 72.25% in the company, making it one of the most likely candidates for privatization. In October last year, HHD signed the final contract for the sale of the Heliopark land, covering an area of 1,695 feddan, to the National Social Insurance Authority.
The ordinary general assembly of HHD approved, on 8 October, the sale of Heliopark, which is part of the company’s land inventory, with an area of 1,695 feddan in New Cairo, directly to the National Social Insurance Authority for a lump sum of EGP 15bn. The land value is paid in a single instalment upon contracting, with the condition that the amounts related to reductions, estimated at around EGP 2bn, will be deducted from it.
The company achieved a net profit of EGP 19.41m during the period from January to the end of March 2023, compared to profits of EGP 3.17m during the same period in 2022.
The company’s revenues during the third quarter of the last fiscal year increased to EGP 90.9m, compared to EGP 63.54m during the same period of the previous year.