Morning Note /
Global

Nothing can stop inflation/earnings season rally in Turkish equities

  • We expect the momentum to continue with global risk appetite also supportive after a no-surprise US CPI print

  • Banks will continue to lead the way with stellar 1Q earnings

  • So stay long banks despite an uncertain macro picture in 2H

Batuhan Ozsahin
ATA Invest
13 April 2022
Published by

Nothing can stop inflation/earnings season rally in Turkish equities. Despite an ATH closing yesterday, we expect the momentum to continue with global risk appetite also supportive after a no-surprise US CPI print.

Banks will continue to lead the way with stellar 1Q earnings. For example, YKB can have reported almost 80% of its 2021 profit in this quarter, depending on what they will use as their new CPI forecast. But whatever they use, as Oct-Oct inflation will be above 60%, hence full year profit growth will be over 150% for most banks. So stay long banks despite an uncertain macro picture in 2H.

Macro news:

Industrial Production (IP) increased by 4.4% m/m in Feb’22 (+9.7% y/y). Industrial production increased by 9.7% y/y in Feb’22 (Jan’22:7.8% y/y)

Company news:

*YKBNK TI> goes ex-dividend today, paying TL0.12/shr (2.29% div. yield) The reference price is TL 5.062

*GENIL TI> goes ex-dividend today, paying TL0.37/shr (2.26% div. yield) The reference price is TL 15.863

*ENKAI TI> goes ex-dividend today, paying TL0.50/shr (3.08% div. yield) The reference price is TL 15.78

*ARCLK TI> bought back 225K shares at an average price of TL63.00 on 12 April 2022. Since 02 July 2021, the total number of shares bought back reached 59.09mn at an average price of TL41.13.

*SISE TI> bought back 1.6mn shares at an average price of TL17.11 on 12 April 2022. Since February, 26 2021, the total number of shares bought back reached 44.8mn at an average price of TL9.44

Weekly Agenda:

14 April: CBRT MPC policy rate decision (Consensus 14%- No Change)