“BUY the right, SELL the stock” is how existing MCRO shareholders can use the current mispricing to make a 40% profit, assuming they are in the stock for the long term.

26 November 2025

Amr Hussein Elalfy

In this note, we lay down an arbitrage strategy that shareholders in Macro Group [MCRO] can use to their benefit. MCRO is undergoing an EGP570mn capital increase with the following details:

• Rights trading: From 18 through 30 November 2025, after which they will expire.

• Subscription to the capital increase: From 18 November through 3 December 2025 for those who are rights holders.

Here is a link to the arbitrage strategy to apply at market price.

In sum, for existing MCRO shareholders, here are the decision rules:

If the price of MCRO’s	is	The price of MCRO’s	then	Current status
right + 0.20	lower than	stock	Buy the right then subscribe	Active
right + 0.20	higher than	stock	Sell the right and buy the stock	Inactive

Note: Arbitrage should be one right per one share.

Source: Rumble Research

How MCRO’s shareholders can benefit

What happened?

MCRO is currently undergoing an EGP570mn capital increase by issuing 2.85bn shares at a par value of EGP0.20 a share with no issuance fees. Thus, MCRO will be raising its paid-in capital from a current EGP114mn (570mn shares at a par value of EGP0.20/share) to EGP684mn (3.42bn shares at a par value of EGP0.20/share).

MCRO’s capital increase

MCRO	No. of shares	Par value (EGP)	Paid-in capital (EGP)
Current	570,206,456	0.20	114,041,291
Subscription	2,851,032,280	0.20	570,206,456
New	3,421,238,736	0.20	684,247,747

Source: Company reports, Rumble Research

The arbitrage strategy

In view of the current market prices, we are proposing an arbitrage strategy that is directed at existing MCRO shareholders given that MCRO’s right is currently trading at a deep discount to MCRO’s stock.

Who is it for?

This strategy is only applicable to existing MCRO shareholders who:

1. Currently own MCRO shares.
2. Intend to hold on to their MCRO shares for at least the next 2-3 months.

 

MCRO’s tradable rights intrinsic value vs. payoff

Source: Rumble Research

Key price levels to keep in mind

No.	MCRO (stock price)	MCROr (right price)	MCROr (intrinsic value)	MCROr (payoff)	Comment
1	0.620	0.685	0.420	(0.265)	EGP0.620/share is the price at which the right produces a negative payoff.
2	0.885	0.685	0.685	0.000	EGP0.885/share is the price at which the right produces a zero payoff (break-even).
3	1.260	0.685	1.040	0.375	EGP1.260/share is yesterday’s market price at which the right produces a positive payoff (i.e. the right is cheaper than the stock).

Source: Rumble Research

What are the risks?

Currently, the right is trading at a discount to the stock, so in essence existing MCRO shareholders who are in the stock for the long term can make some money by selling their stock (sell high) then use that money to buy the right (buy low).

However, to benefit from this, they need to buy the right at the same time they are selling the stock, so that market fluctuation does not impact the final payoff.

The key risk is that MCRO’s stock price is currently trading at a huge premium (more than double) to the independent financial advisor’s (IFA) fair value post-capital increase of EGP0.62/share. Thus, those opting to hold on to MCRO shares after the rights are exercised face the market risk that MCRO stock price may fall in the future.

It is their decision then to either:

1. Sell the stock once the subscription shares are made available in 2-3 months’ time, provided they are profitable.
2. Continue to be long-term shareholders in the stock.

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