Inflation drove EGX gains; government IPOs awaited: Chairman

Rami El-Dokany, EGX Chairman 

The Egyptian Exchange (EGX) has been extending uptrend since 2022 due to the inflation wave in the country, leading to bullish indices and higher local liquidity, Rami El-Dokany, EGX Chairman, told Argaam on the sidelines of the AFCM Annual Conference in Muscat. 

El-Dokany indicated that two companies were listed on the SME market, expecting a private sector firm to obtain listing regulatory approvals before the end of May.  

The market is awaiting the government’s IPOs program, whether through divestiture to strategic investors or public offering, as it will help boost the Egyptian economy as well as the EGX performance.  

The Egyptian market is still attractive for foreign investors, especially Arabs. However, the fluctuation of exchange rates may weigh on the market attractiveness, noting that a stable currency may enhance cash inflows. 

Foreign investors account for one third of the Egyptian market, he added.  

El-Dokany revealed plans to establish an EGX financial derivatives firm after setting up a derivatives clearing company, in addition to the planned voluntary carbon market by year-end.  

He also spoke of exchanging expertise with the Arab markets, especially the GCC bourses, citing the Tabadul regional exchange hub, which was created as a collaborative initiative between Abu Dhabi Securities Exchange (ADX) and Bahrain Bourse (BHB).  

The GCC markets have a privilege that all clients are US dollar-pegged, which greatly facilitates settlement processes. However, there is a need for a third party to ease local-currency settlements, El-Dokany concluded.