Elsewedy Electric, an Egyptian manufacturer and distributor of energy products and services, has reported poor results, but analysts see it offering investors a good deal.
Final-quarter results at Elsewedy missed expectations.
The company posted a net loss of 20 million Egyptian pounds, missing CI Capital Research's estimate of 133m pounds and market consensus of 186m pounds.
But CI Capital Research recommends that investors buy the stock, which is trading at about 20 pounds, with the view that the long-term fair value is 32.50 pounds.
CI Capital Research set a target price of 25.20 pounds.
The analysts attributed the worse-than-expected fourth quarter results to higher-than-expected financing costs.
With the turmoil in Syria continuing, Elsewedy decided to export the entirety of its Syrian production, 8 per cent of wire and cable business, and sell it on a cash basis.
Egypt and Libya remain the management's primary focus, according to analysts, so the company's fortunes will be tied up with those countries' to some extent.
Elsewedy is well diversified, however.
It has just won a tender in Kuwait valued at approximately US$59m.
In addition, Wael Hanny, the vice president of Elsewedy Power, in a recent visit to Nigeria - which has said it needs to invest $150 billion in electricity - described the West African country as a "virgin land" in electricity supply.
The company has a subsidiary in Nigeria, so it will be looking to increase its footprint there.
