FINANCIAL

MANAGEMENT
• Investment Banking
Dr. Mohamed El Semary
Prepared By:
• Nada Mahmoud
• Sherif Khashab
• Mahmoud Alaa
• Kareem Draz
• Mennatallah Wagdy
• Mohamed Yousry
INVESTMENT BANKING

CI Capital Holding
 INTRODUCTION
Investment Banking

 The investment banking industry in Egypt is a critical component

of the financial sector, which provides a range of financial
services to businesses, government entities, and individuals.
Investment banks in Egypt offer a broad spectrum of services,
including mergers and acquisitions, capital markets, and asset
management, among others.
 COMPANY INTRODUCTION
CI Capital Holding

 Company Name CI Capital Holding For Financial Investments

(CICH)

 Company Purpose CI Capital Holding For Financial

Investments (known as: CI Capital Holding) is a public
company, listed on Egyptian Exchange (EGX) since April
2018. CI Capital operates within the diversified financials
sector focusing on investment banking & brokerage through
institution premises in Cairo, Dubai, New York.

 Company Establish Date10 April 2005

 INCOME STATEMENTS
2019-2020-2021

CI Capital Holding
 BALANCE SHEET STATEMENTS
2019-2020-2021

CI Capital Holding
  Profitability/ Profit Margin : assess a firm's ability to earn profits from its sales

Profit Margin 2019 2020 2021

88% 86% 62%

Trend Analysis -1.43% -23.89%

CI Capital Holding Trend Analysis Comments:

• CI paid 229,941,181 more than 2020 by 128,752,989 in terms of
EFG HERMES Administrative and General Expense
HOLDING • Interest Rates
• Non-Performing Loans
BENCH MARK-2021 • Credit Risk
Peer Analysis 2021 • Market Competition
Profit Margin 37% • Regulatory Changes

Peer Analysis Comments:

• CI gained 101,539,788 from treasury bills, interest revenue,
investments selling revenues
• Lower operating costs
• Higher interest rates
• Better risk management
• More effective revenue mix
  Profitability/BEP: assess how effectively a firm uses its assets to generate income

BEP 2019 2020 2021

5% 9% 14%

Trend Analysis 4.26% 4.74%

CI Capital Holding
Trend Analysis Comments:

EFG HERMES • Other assets 231,763,480

HOLDING • MCI Capital healthcare raised capital by 224,999,250
• Improvements in Asset Quality
BENCH MARK-2021
Peer Analysis 2021 • Better Interest Rate Management
BEP 4% • More Efficient Use of Assets
• Effective Risk Management.

Peer Analysis Comments:

• Higher net interest income

• More efficient asset utilization
• More effective risk management
  Profitability/ROI:  asses how well an investment has performed

ROI 2019 2020 2021

4% 9% 13%

Trend Analysis 4.30% 4.01%

CI Capital Holding
Trend Analysis Comments:
EFG HERMES
• Improved Loan Quality
HOLDING • Effective Interest Rate Management
BENCH MARK-2021
Peer Analysis 2021 • Better Investment Decisions
• Lower Operating Expenses
ROI 4%
• Effective Risk Management.

Peer Analysis Comments:

• Higher interest rates

• Lower investment costs
• More effective investment strategy
• Higher-quality loan portfolio
• Better use of leverage
  Profitability/ROE: asses firm's profitability and how efficiently it generates those profits

ROE 2019 2020 2021

5% 9% 13%

Trend Analysis 3.99% 4.33%

CI Capital Holding

Trend Analysis Comments:

EFG HERMES
HOLDING • Higher Net Interest Margin
• Efficient Use of Leverage
BENCH MARK-2021
Peer Analysis 2021 • Effective Expense Management
ROE 6% • Lower Credit Losses

Peer Analysis Comments:

• Improved Loan Quality

• Effective Interest Rate Management
  Debt Management/Debt Ratio: asses the extent of a company's leverage

Debt Ratio 2019 2020 2021

9.067% 1.521% 3.398%

Trend Analysis -7.5% 1.9%

CI Capital Holding

Trend Analysis Comments:

EFG HERMES
HOLDING • Comparing 2020 to 2019 debt ratio decreased by 7.5 % as the company
almost doubled its fixed assets (furniture, equip...etc.) and also started
BENCH MARK-2021
Peer Analysis 2021 financial investments in local listed stocks in Egyptian exchange stock
market depending on increasing equity by 200M EGP. The debt ratio
Debt Ratio 25.476% increased later in 2021 by 1.9 % compared to 2020 the company
investment in 2021 by large was for increasing the capital of one of its
companies
( MCI capital health care) shown in other assets. again the increase
reflects a slight increase in liabilities which is compatible with the
conservative policy of the company.

Peer Analysis Comments:

• EFG is less conservative than CI

  Asset Management/Working Capital Turnover: asses the extent of a
company's leverage
Working Capital Turnover 2019 2020 2021
0.43 0.59 1.11
Trend Analysis 0.16 0.51
CI Capital Holding

EFG HERMES Trend Analysis Comments:

HOLDING • Comparing 2020 to 2019 in 2020 increase 0.16 which become
BENCH MARK-2021
Peer Analysis 2021
0.59 which means that in 2020 that company generate EGP 0.59
revenue for every EGP of working Capital.
WCT 0.32 • Comparing 2021 to 2020 increase 0.51 which become 1.11
which means that company generate EGP 1.11 of sales for every
EGP of working capital.

Peer Analysis Comments:

• CI capital is better in Utilizing its working capital as it
earns EGP 0.78 more than EFGH (0.32)
  Asset Management/Fixed Asset Turnover: asses the extent of a company's
leverage
Fixed Asset Turnover 2019 2020 2021
5.83 8.13 20.57
Trend Analysis 2.30 12.44
CI Capital Holding

Trend Analysis Comments:

EFG HERMES
• Comparing 2020 to 2019 the fixed asset increase EGP 2.30 to
HOLDING become 8 which means that in 2020 they generated EGP 8 for
BENCH MARK-2021
Peer Analysis 2021 every 1 EGP in fixed asset
FAT 6.41 • Comparing 2021 to 2020 Fixed ratio increased EGP 12.44 to
become 21 which means that in 2021 that they generate EGP 21
for every EGP 1 in fixed assets.
Note: due to increase in sales due to consulting service

Peer Analysis Comments:

• CI capital generates EGP 14.6 more profit from its fixed
asset than EFG Hermes (6) which makes CI capital better
in managing its fixed asset
  Asset Management/Total Assets Turnover: asses the extent of a company's
leverage
Total Asset Turnover 2019 2020 2021
0.03 0.10 0.20
Trend Analysis 0.07 0.10
CI Capital Holding

EFG HERMES Trend Analysis Comments:

HOLDING • Comparing 2020 to 2019 Total asset turnover increase EGP 0.07
BENCH MARK-2021
Peer Analysis 2021
to become EGP 0.10 profits generated from every EGP 1 in total
assets due to increase in divided income which increased sales.
TAT 0.11
• Comparing 2021 to 2020 Total assets increased EGP 0.10 to
become 0.20 which means generated profit from every EGP 1 in
total asset = 0.20

Peer Analysis Comments:

• CI capital generates 0.09 more profit from EFG H as CI
capital = 0.20 while EFG Hermes = 0.11
  Market Ratio/Earning per Share: asses the extent of a company's leverage

Earning per Share 2019 2020 2021

0.08 0.15 0.23
Trend Analysis 0.07 0.10
CI Capital Holding

Trend Analysis Comments:

EFG HERMES
• Comparing 2020 to 2019 EPS increased 0.077 to become in
HOLDING 2020 0.15 which means ci capital earns EGP 0.15 in net income
BENCH MARK-2021
Peer Analysis 2021 for each outstanding share
EPS 0.56 • Comparing 2021 to 2020 EPS increase 0.80 to become 0.20
which means CI capital earn Egp 0.20 in net income for each
outstanding share.
Due to increase in Distributable profit for the year

Peer Analysis Comments:

• CI Capital EPS is less than EFGH with difference EGP 0.09
as CI capital =0.23 and EFGH is EGP 0.56
So for CI Capital to increase EPS it can issue preferred shares
and reduce outstanding shares
  Market Ratio/Price EPS: asses the extent of a company's leverage

Price EPS 2019 2020 2021

132.308 65.332 42.973
Trend Analysis -66.98 -22.36
CI Capital Holding

EFG HERMES Trend Analysis Comments:

HOLDING • Comparing 2020 to 2019 P/E there is decrease 67 times which
BENCH MARK-2021
Peer Analysis 2021 means in 2021 the stock price of CI capital is trading 65 times
Price EPS 8.950 the EPS
• Comparing 2021 to 2020 there is decrease 22 times to become
in 2021 the stock price of CI capital trading is 23 times the EPS.

Peer Analysis Comments:

• Compared to EFG Hermes P/E ratio is very high in CI
capital it is 43 while EFG Hermes is 9
  Liquidity Ratio

Current Ratio 2019 2020 2021

1.89 12.16 8.5

Trend Analysis 10.27 -3.66

CI Capital

• Is it Good sign?
EFG Hermes Holding • With Respect to Trend analysis: No.
Bench Mark-2021 • With Respect to Peer Analysis: yes.
• However, EFG in 21 is also declining from 20 (2.25).
Peer Analysis 2021 • Recommendations:
Current Ratio 1.2 • Cash and debit balances
• Investments at fair values
• Loans to Subsidiaries

• Bank Overdraft
• Due to Subsidiaries
• Creditors and credit balances
• Provisions (but not only decrease them!)
  Liquidity Ratio

Cash Ratio 2019 2020 2021

0.8 2.6 0.6

Trend Analysis 1.8 -2

CI Capital

• Is it Good sign?
EFG Hermes Holding • With Respect to Trend analysis: May be!.
Bench Mark-2021 • With Respect to Peer Analysis: Yes.
• Recommendations:
Peer Analysis 2021 • Cash and debit balances
Current Ratio .06
• Bank Overdraft
• Due to Subsidiaries
• Creditors and credit balances
• Provisions (but not only decrease them!)
COMMON
APPROACH
CINon- current
Capital assets investing
are mainly present
in83% of total assets
subsidiaries andor
in direct
dropped
indirect 1.4% in
through 202082%
loans. andin
continue
2019 decline
, drop to 79%in in
2021
2020to

2019-2020-2021
76.9%79%in 2021

CI Capital had 1.6% increase in

assets in 2020 and grow 3% in
2021

CI Capital having a strategy of

financing its assets from
Decrease reserve 33.2% in 2020
shareholder equity and had
and Retain the same reserve
significant increase in 2020
value in 2021
+7.6% above 2019 by increasing
.
paid capitalliabilities
Non-current 200 m EGP and in
present
2021
only dropped
0.056% 1.8%assets
of total due releasing
which
give indicationESOP.
that CI capital is
not preferred to use loans to

CI Capital finance its assets.

Increase capital 200 M in 2020
+10% of total equity and increase
1% through increase retained
Current liabilities present 9% in earnings in 2021
2019, dropped to 1.5% in 2020 .
due a loan under settlement
.
PEER ANALYSIS
COMMON SIZE COMMENTS CI Capital has +15.6% increase
in non-current assets which
reflect the company strategy in

2021 counting on long-term

investment

CI Capital vs. EFG HERMES CI Capital is away behind EFG

by 15.8% in current assets
however CI Capital has an
approach of increasing current
assets in previous 2 years from
17% to 20% in 2021

CI Capital is heavily counting in

shareholder equity 96.6% of its
assets financed from OE, on
other side EFG are mixing
between equity and Liabilities

same trend in current libalities

2.45% vs 30.2% which explain
the way of financing for both
companies and total liabilities
reflect the same approach
 FSA COMMENTS & RECOMMENDATIONS
2019-2020-2021
CI Capital Holding
 COMMON APPROACH COMMENTS &
RECOMMENDATIONS
2019-2020-2021
CI Capital
 WACC
2021
CI Capital
 CONCLUSION
CI Capital
THANK YOU

 Any Questions…