Eastern Tobacco (EAST.CA) Share Overview

1. Business Description

Eastern Company S.A.E. (ticker: EAST) sells cigarettes, cigars and moassel products. It also exports its products primarily to Kingdom of Saudi Arabia, the Malawi, Bahrain, Madagascar, Kuwait, Qatar, Lebanon, Jordan, the United Arab Emirates, Libya, Iraq, Oman, Germany, Austria, Malaysia, Japan, Thailand, Canada and the Unites States. It is listed on the Egyptian Stock Exchange and included among the companies in the EGX 30.

HeadquartersGiza, Egypt
Founded1920
IndustryTobacco
Parent CompanyThe Holding Company for Chemical Industries
Phone20 2 38164444
IndexEGX 30
Data retrieved from Eastern Tobacco’s Financial Statement
Eastern Tobacco Products
Source: Ahram

2. Financial Statements

The following section presents a summary of the financial and operating performance of Eastern Tobacco over the past 3 years. It presents the firm’s Key Financials. All is Data retrieved from Eastern Tobacco’s Financial Statement.

2.1 Profitability

The following table presents the Revenues, Revenue Growth, Net Income and Net Income Margin of the company. Net Income Margin is defined as Net Income divided by Revenues of the same year.

in Millions of EGPDec-31-2018Dec-31-2019LTM Sep-30-2020*
Revenues13,410.0114,025.4714,704.51
Growth 27.22%4.59%2.69%
Net Income4,240.603,733.303,898.64
Margin31.62%26.6%26.5%
Data retrieved from Eastern Tobacco’s Financial Statement
*LTM Sep-2020 Growth is computed using LTM Sep-2020 Revenues and LTM Sep-2019 Revenues

2.2 Mini Balance Sheet

The following table presents the Liabilities, Equity and Total Assets of Eastern Tobacco. Total Assets equals the sum of Total Liabilities and Total Equity.

in Millions of EGPDec-31-2018Dec-31-2019Sep-30-2020
Liabilities10,614.2713,600.8615,305.25
Equity 6,483.277,776.118,574.49
Total Assets17,097.521,376.9723,879.75
Data retrieved from Eastern Tobacco’s Financial Statement

2.3 MINI Cash Flow Statement

The following table presents the Cash from Operations, Cash from Investing, Cash from Financing and Net Change in Cash. Net Change in Cash equals the sum of Cash from Operations, Cash from Investing and Cash from Financing.

in Millions of EGPDec-31-2018Dec-31-2019LTM Sep-30-2020
Cash from Operations2,093.445,842.597,387.78
Cash from Investing(931.64)(2,438.74)(2,395.46)
Cash from Financing(4,443.66)(2,550.36)(2,471.19)
Net Change in Cash(3,307.95)2,269.114,118.28
Data retrieved from Eastern Tobacco’s Financial Statement

3. Capitalization

The market capitalization of Eastern Tobacco equals the share price times the number of shares outstanding.

Share Price12.93 EGP / share
Number of Shares2,203,000,000 shares
Market Capitalization28,484,790,000 billion EGP
As of 4 December 2020

4. Multiples

The following table presents the Total Enterprise Value/LTM Total Revenue, P/LTM EPS and P/BV. The multiple used is the average multiple over the period.

MultipleDec-31-2018Dec-31-2019Dec-12-2020
TEV/LTM Total Revenue3.32x2.29x1.44x
TEV/LTM EBITDA8.36x6.28x3.73x
P/LTM EPS11.40x10.23x7.80x
P/BV5.01x4.10x2.85x
The multiple used is the Average Multiple over the period

5. Top Holders

The following table lists the top holders of the company as of November 2020.

HolderCommon Stock Equivalent Held% of Total Shares OutstandingMarket Value (EGP in mm)
Chemical Industries Holding Company S.A.E.
1,136,250,000

51.58

14,710.2
Invesco Ltd.69,251,0243.14896.5
LGM Investments Limited44,659,3402.03578.2
The Vanguard Group, Inc.33,659,9121.53435.8
BlackRock, Inc.30,757,7811.40398.2
As of December 2020

6. Analyst Consensus

Based on 5 Analysts, has a median price target of 19 EGP / share. This represents an approx. 46% upside potential from the current share price of 12.93 (as of the 12th of December 2020).

7. News

Headlines:

  1. EAST reports a EGP1.16 billion profit in Q1 2020/2021
  2. EAST shareholders approve a 1.4 EGP/ share dividend
  3. EAST announced a new price list for some products, including cigars and tobacco.
  4. EAST Targets EGP4.2 billion Sales in FY2020/2021

8. Egx 30 companies

1. Commercial International Bank -Egypt S.A.E
2. Eastern Company S. A. E.
3. Telecom Egypt Company S.A.E.
4. El Sewedy Electric Company
5. Talaat Mostafa Group Holding Company TMG Holding (S.A.E)
6. Emaar Misr for Development Company (S.A.E.)
7. EFG-Hermes Holding S.A.E
8. Heliopolis Co. for Housing & Development
9. Cairo for Investment & Real Estate Development S.A.E.
10. Credit Agricole – Egypt Bank (S.A.E.)
11. Cleopatra Hospital Group S.A.E.
12.Edita Food Industries Company (S.A.E)
13. Juhayna Food Industries S.A.E.
14. Madinet Nasr for Housing & Development S.A.E.
15. Ibn Sina Pharma (S.A.E)
16. Orascom Development Egypt (S.A.E)
17. Oriental Weavers Carpets Company (S.A.E)
18. Sixth of October for Development and Investment Company “SODIC” (S.A.E.)
19. Pioneers Holding Company For Financial Investments
20. Sidi Kerir Petrochemicals Co.
21. Palm Hills Developments S.A.E.
22. Export Development Bank of Egypt (S.A.E.)
23. Ezz Steel Company
24. GB Auto (S.A.E.)
25. Egyptian Iron and Steel Company
26. Orascom Investment Holding S.A.E.
27. Qalaa Holdings S.A.E.
28. Beltone Financial Holding SAE
29. Egypt Kuwait Holding Company (S.A.E.)
30. Dice Sport & Casual Wear

9. Additional Information

Eastern Tobacco has an extremely attractive dividend yield of almost 10%. This is mainly attributable to Eastern Tobacco’s huge cash pile which exceeds EGP 11 billion at September 2020.

Ethical Investment strategies usually exclude tobacco and alcohol manufacturers and certain other sectors from the investment universe.

This article is updated on an annual basis. Last updated on December 2020.

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