Telecom Egypt, OCI Lift Egypt Index to New High

Telecom Egypt surged 5.1 percent to 20.30 Egyptian pounds ($3.67) as foreign investors deemed its share price undervalued.

Shares of Telecom Egypt and Orascom Construction Industries powered Egypt's benchmark index to a fresh life high on Sunday, lifted by foreign buying.

Telecom Egypt surged 5.1 percent to 20.30 Egyptian pounds ($3.67) as foreign investors deemed its share price undervalued, traders said.

"Buying is coming mainly from Europeans and other Westerners," Aly Allouba, head of equities at Delta Securities, said. "The fair value for Telecom Egypt is between 22 and 23.50 pounds."

Telecom Egypt, which extended gains for a fifth day, is trading at a price to 2007 earnings ratio of 12.46 compared to a Middle East sector average of 13.48, according to Reuters data.

OCI jumped to a record high as prices at an auction for greenfield cement plants in Egypt suggested a higher value for Orascom shares, Allouba said.

OCI shares surged 3.9 percent to 486.49 pounds, a record high.

The benchmark Case 30 index climbed 1.4 percent to 9,276.84 points after hitting a record high of 9,294.36 points during the session. Egypt's well-watched Hermes index rose 1.6 percent to 82,328.12 points.

Egyptian shares were benefiting as more money flows to emerging equities, which hit an all-time high on Friday, as some fear a slowdown in the United States, traders said.

"Foreigners are seeing they can make a good return here without getting bogged down with what's happening on the international markets," Yasser Hassanein, head of business development at Dynamic Securities, said.

"The Egyptian pound is also appreciating so they could make a gain on that also," he added. ($1 = 5.53 Egyptian pounds)