Deutsche Bank - Egypt Real Estate - (6th of July 2010) - SODIC

5 July 2010 Real Estate, Construction and Building Materials Egypt Real EstateFigure 18: SODIC SOTPEGPm % EV CommentsDevelopment properties 1,567 48% DCF, WACC @14.6%Investment Properties 0 0% At 2009 BV (no capex incurred till 2009)Landbank 1,584 48% Benchmarked to 2007 auction pricesOthers 128 4% Investments @ 2009 BVTotal EV 3,279Net Cash (2009) - Adjusted rights issue 935Land liability (To be paid over 7 yrs) (146)Equity value 4,068Number of shares (m) - rights issue adjusted 36.3NAV per share 112Source: Deutsche Bank estimatesFigure 19: PHD SOTPEGPm % EVDevelopment properties 4,111 40%CommentsInvestment properties 483 5% 2009 BVLandbank 5,356 52%Associates & other assets 306 3% Includes KSA land at costTotal EV 10,255Net cash (2009) - Rights issue adjusted 98Land liabilities (2009 BV), to be paid over 8yrs (4,180)Equity Value 6,174Number of shares (m, rights issue adjusted) 1,048NAV per share 5.9Source: Deutsche Bank estimatesDCF at WACC, pre-sales limited to 2012E and 36 to40% gross marginWest/East Cairo @ 2007 auction price of EGP850/750per sqm. Non-Cairo: implied value assuming subdevelopercost structure (EGP238/sqm)Figure 20: TMG SOTPEGPm % EV CommentsDevelopment properties 8,703 38% DCF @ 15.1% WACCHotels & Resorts 2,211 10% Matured portfolio @ 12x GP, rest at BVLandbank 10,072 44% At 525/sqm (30% discount to 2007 Auction )Others 2,162Total EV 23,149Net debt (2009) (1,708)Equity value 21,441Number of shares (m) 2,009SOTP per share 10.7TP per share 7.8Source: Deutsche Bank estimates8% @ 2009BV (Associates, financial investments, includesKSA land at cost)Figure 21: TMG TP justificationCourt judgment EGP per share LikelihoodPositive 10.7 50%Negative 4.9 50%Average TP 7.8Source: Deutsche Bank estimatesDeutsche Bank AG/London Page 15