We are starting the new week after a strong performance by equities that were up 3.5% for the week and in local currency terms, Turkish equities were one of the best performers(+21%) in 1Q and even in USD terms was in positive territory despite a 10% depreciation against the greenback. The banks recovered a bit after Garanti’s buyback was approved and closed the quarter up 10%, while industrials were up 17% , led by commodity names. Aviation was the best performer of 1Q, while insurance was the worst.
Today, we start the week with March CPI and we expect annual inflation to hit 62%, but more important than that we know the monetary policy will not change and policy rate will be held 14%. Real interest rates will settle anywhere between negative 48-50%. On the other hand, we will find out the preliminary March trade deficit. Official trade deficit had reached USD18bn in Jan-Feb (USD45bn for all of 2021) and current momentum shows USD100bn trade deficit for 2022. This will inevitably push Lira lower in the coming months. Equities & the FX-protected deposit scheme are the only capital market alternatives for Lira savers as a hedge for inflation.
*MGROS TI> shareholding in Package Logistics increased to 75% (neutral) It has been decided to purchase 279,718 shares with a nominal value of TL 279,718 owned by other shareholders of Migros' 25% subsidiary, Package Logistics and Technology ("Paket Lojistik"), by paying in advance by Migros for TL 104.5mn. As of 1 April 2022, Migros' shareholding in Package Logistics has increased to 75%.
*SAHOL TI> bought back 993K shares at an average price of TL17.12 on 01 Apr 2022. Since 09 Nov 2021, the total number of shares bought back reached 36.1mn at an average price of TL15.05.
*BASGZ TI> goes ex-dividend today, paying TL0.79/shr (5.75% div. yield) The reference price will be TL 12.94
*KORDS TI> goes ex-dividend today, paying TL0.82/shr (2.31% div. yield) The reference price will be TL 34.858
4 April: March CPI (Consensus 5.84% m/m, 61.5% y/y)
5 April: March Real Effective Exchange Rate
7 April: March Cash Budget Balance
7 April: KCHOL dividend payment TL 0.90/share