[2008-04-18]  OT leads Egypt bourse up after buyback offer
An offer from Orascom Telecom on Thursday to buy 10.3 percent of its own shares boosted the stock, which led a market rebound for the first time in seven sessions, brokers said.
The offer, which will also apply to the company's London- based GDRs, is for 83 Egyptian pounds ($15.31) per share, taking the potential cumulative value of the transaction to 8.798 billion pounds.
"This was the best option now for the company to make use of its abundant cash as there is no attractive expansion opportunities," said Amr el-Alfy, head of research at CIBC Brokerage.
He added that 83 pounds was less than the fair value of the stock, "as if it was making a capital gain."
HC Securities Brokerage said on Thursday it maintained its 102 pound target price for the firm's local shares and $89.5 target price for GDRs.
OT shares, the most highly traded by turnover on Thursday, surged 8.7 percent to a high of 81.4 pounds a share in early trading before last trading at 78.20 pounds.
Amr Alaa of Prime Securities said OT's bounce had a positive effect on "some telecom stocks and on Orascom Construction Industries."
Shares in Telecom Egypt rose 1.9 percent to 20.20 pounds, while the Egyptian Company for Mobile Services Mobinil gained 0.7 percent to last trade at 196.01 pounds.
Brokers said an HSBC report on OCI also helped the stock up to last trade 2.7 percent higher at 428.25 pounds.
HSBC raised its price target for OCI on Wednesday to 592 pounds from 439 pounds to maintain its "overweight" rating on the stock.
Overall, Egypt's benchmark CASE 30 index closed 2.3 percent higher at 11,573.98 points, while the well-watched Hermes index climbed 1.9 percent to 100,795.5 points.
But the broader CIBC index slipped 1.8 percent to 567.58 points as textiles sank, led by Arab Polavara, which lost 7.6 percent to 11.72 pounds.

Source: © Guardian News and Media Limited 2008