Morning Note /
Turkey

Turkey: We expect a flat opening today

  • BIST 100 Index tested to stay above 5,000 but closed at 4,957 level yesterday.

  • Turkish wealth fund announced to buy KRDMA shares which may be supportive for Kardemir shares.

  • 4,900 support will be critical and unless broken down, positive sentiment is likely to continue.

ATA Invest
6 December 2022
Published byATA Invest

BIST 100 Index tested to stay above 5,000 but closed at 4,957 level yesterday. Aviation companies rallied with the leadership of THYAO. Please recall we remain positive with THYAO PGSUS and TAVHL and TAVHL is one of ATA top picks. 4Q expectations are positive for the sector as well. Telecom companies may start outperforming as the inflation will start declining due to base effect gradually. TCELL is one of ATA TOP Picks. Turkish wealth fund announced to buy KRDMA shares which may be supportive for Kardemir shares. Food retailers bounced back yesterday after falling sharply at the opening. Today we expect a flat opening. 4,900 support will be critical and unless broken down, positive sentiment is likely to continue. CCOLA THYAO TCELL looks strong for short term trading.

Macro news:

CPI increased by 2.88% m/m in Nov’22 (Bloomberg consensus: +3.00%). CPI increased by 2.88% m/m to 84.39% y/y in Nov’22. PPI increased by 0.74% m/m to 136.02% y/y in Nov’22. With the highest share in the calculation (%25.32), Food and Non-Alcoholic beverages increased by 5.79% m/m (+102.55% y/y) in Nov’22. Core inflation (excluding alcoholic beverages, tobacco products, energy and gold, B) increased by 76.18% y/y in Nov’22 (Oct’22: 77.01% y/y). With the Inflation Report published in Oct’22, Central Bank of Turkey increased its 2022 inflation target to 65.2% from 60.4%. (ATA Est.: 68.0%).

Company news:

*KRDMA TI: Turkish Wealth fund announced that it will buy 32 mn KRDMA shares from Kardokmak and 18,3 mn KRDMA shares from Karcel at TRY 13,05/share. After rising 9.9% KRDMA shares closed at TRY 13,05 yesterday. 

* MPARK TI> bought back 15K shares at an average price of TL78.05 on 5 December 2022. Since 25 May 2022, the total number of shares bought back reached 6.8mn at an average price of TL49.12.

*TTRAK TI> total sales volume increased by 8.1% y/y in Nov’22...On a segmental basis, domestic volume increased by 11.4% y/y whereas export sales volume increased by 3.2% y/y respectively. Going forward, we foresee TTRAK’s domestic tractor sales volume to decrease by 14.6% y/y to 27.3K units and export sales volume to increase by 9.3% y/y to 17.7K units in 2022E. Based on our estimates, the company trades at 23E 7.4x EV/EBITDA and 23E 9.2x P/E, compared to its 5-year average 6.3x EV/EBITDA and 7.1x P/E multiple.