For Long-Term Investors _Delta Sugar Company (EGX:SUGR)Delta Sugar Company (EGX:SUGR)
On 7th April 2025 close at 47.30 EGP/Share
Overview
Delta Sugar Company engages in the manufacture and sale of sugar beets in Egypt. The company was founded in 1978.
📊 Financial Snapshot
✅ Strengths:
• EPS (Trailing): 7.60 → Solid earnings power.
• PE Ratio: 6.22 → Undervalued vs. market.
• Book Value/Share: 23.71 EGP → P/B ratio ≈ 2 → Moderately priced on asset basis.
• Strong ROE: 39.38%
• ROIC: 22.22% → Efficient capital use.
• Net cash position: +557.5 million → No leverage risk, ample liquidity.
⚠️ Weaknesses:
• Free Cash Flow: -181.79 million → Negative FCF is a concern, suggests reinvestment isn't translating into near-term cash.
• Operating CF: -38.57 million → Not generating core operational cash right now.
Fair Value Estimates:
• Cairo Financial Holding: 71.80 EGP
• Ostoul Securities Brokerage
• Sector-based Book Value Multiple 76.58 EGP/Share
• Sector-based PE Multiple 98.069 EGP/Share
Financial Highlights – FY 2024
EGX:SUGR has a market cap or net worth of EGP 6.89 billion. The enterprise value is 8.5 billion.
Enterprise Valuation
The stock's EV/EBITDA ratio is 6.91, with an EV/FCF ratio of -46.75.
Income Statement
In the last 12 months, EGX:SUGR had revenue of EGP 6.22 billion and earned 1.08 billion in profits. Earnings per share was 7.60 with Perpetual growth rate is 3%
Balance Sheet
The company has 557.70 million in cash and 193,412 in debt, giving a net cash position of 557.50 million or 3.92 per share.
Cash Flow
In the last 12 months, operating cash flow was -38.57 million and capital expenditures -143.22 million, giving a free cash flow of -181.79 million.
Financial Efficiency
Return on equity (ROE) is 39.38% and return on invested capital (ROIC) is 22.22%.
📌 Investment Strategy Summary
For Long-Term Investors:
• The current zone of 44–54 EGP is seen as accumulation by smart money.
• Money flow profile (ROC) is 55 EGP/Share
• Price is still under EMA 200, but any breakout with ROC reversal could confirm Wave 5 uptrend.
• Targets:
Refer to Gann analysis
o TP1: 61.13 EGP (July 2025)
o TP2: 77.8 EGP (Nov 2025)
Refer Elliott Wave Analysis Wave 5 Target Zone: 98–132 EGP/share (2025–2026 outlook)
🧠 Final Thoughts
Delta Sugar is currently fundamentally undervalued with a strong balance sheet, but cash flow concerns persist. The technical setup indicates it's near the end of a corrective phase, and potential for a strong Wave 5 rally exists — though the key breakout zone is 54–55 EGP
