Cairo - Mubasher: Pharos Research upgraded its fair value (FV) for Oriental Weavers from EGP 11.20 to EGP 19.80 per share on post floatation effect on the company’s fundamentals.
Pharos believes that Oriental Weavers is well positioned, locally and globally, to improve its margins and volumes.
Pharos expects Oriental Weavers' local sales to spike on the implemented 40% price hike on two phases, post floatation.
In addition, Pharos assumes that local sales volume will shrink 10% in 2017, with inflationary pressures and the readjustments to lower disposable income, while estimate local sales to grow 23% in 2017, followed by a more reasonable 7%, and then stabilize at 6% per annum.
Meanwhile, the research house believes that ORWE will sustain solid market share in the local market due to import restrictions, low competitiveness of imported rugs and import rationalization initiatives by the government.
