Following Act Financial’s Analyst Day held yesterday, the management announced plans to distribute dividends amounting to EGP 200 million this year, in addition to a previously distributed EGP 200 million—resulting in a payout ratio of 40% for H1 2025 and a strong dividend yield of 12%. The management also highlighted its intention to raise around EGP 1 billion in loans in the near term to support the expansion of financial investments and the growth of its platform. Moreover, Act’s inclusion in the EGX70 index starting August 1 is expected to enhance visibility and provide future liquidity support for the stock.
The company’s stock is currently trading near its net asset value, with cash comprising 98% of its assets. It has a price-to-book ratio (P/B) of 1.2x and a price-to-earnings ratio (P/E) of 2.2x, alongside an impressive return on equity (ROE) of 44% and a net profit margin of 83% in H1 2025—largely driven by a one-off profitable sale of its stake in Ezz Steel.
From a valuation perspective, Act’s current market capitalization stands at EGP 3.3 billion. Visible assets make up nearly 55% of that value, including:
- A 4.65% stake in Beltone worth EGP 1.6 billion, and
- A cash balance of EGP 217 million as of March 2025.
Meanwhile, undisclosed financial investments and the digital investment application “Wilzy” account for an additional EGP 1.7 billion.
We believe Act is well-positioned to benefit in the short term from a recovery in the stock market amid falling interest rates. However, “Wilzy” is seen as the key long-term growth driver for the company, being well-placed to capitalize on the growing trend of financial inclusion. Wilzy is expected to benefit from a simplified tech-based model and achieve a high-multiple valuation—similar to Thndr, which reached a top-three market position within just five years, capturing a 6.60% market share by 2025. Thndr’s business volume grew rapidly from under EGP 24 million in 2020 to nearly EGP 76 billion in H1 2025, showcasing the immense potential of digital trading apps to transform a highly fragmented market.
Wilzy is also expected to leverage Act’s expertise in capital markets and its strategic partnerships with investors, which enhance its market reach and client acquisition.
