Turkish equities had another record day helped by the banks. The banks will have a record 2Q helped by the record accrued interest from CPI-linkers. Most banks have used 40% for CPI linker valuation in 1Q, so the contribution from CPI linkers will be ever increasing. President Erdogan re-iterated that there will be no interest rate increase during their term, on the contrary we should expect cuts. Lira continues to weaken with dollar gaining ground, we should not expect inflation to ease with this strategy in our view.
Real Effective Exchange Rate (REER) declined by 2.1% m/m to 55.62 in May’22 (Apr’22: 56.83).FX basket which is calculated as an average of Euro and US$ appreciated by 5.8% m/m in May’22 (Apr’22: -0.3%).
*TOASO TI > Stellantis Group announced that New Fiat Doblo will be produced in the Stellantis factory "Vigo" located in Spain. <Negative for TOASO TI> Tofas had announced that current Fiat Doblo production will continue at the TOASO’s factory until the end of 2022. According to the company's announcement regarding New Fiat Doblo production, the assessments on the prolongation of current version of Fiat Doblo production until the end of 2023 to serve the end markets in Turkey, NAFTA, Middle East and Africa region as well as potential production of new models are ongoing.Please note that Doblo sales volume constitutes 23.6% and 30.8% of the company’s domestic and export sales volume in 2021, respectively. The fact that TOASO has not been given a new production mandates creates uncertainty for the company outlook in the medium terms considering that Bursa plant is one of the most efficient plants in Fiat universe.
*MPARK TI> bought back 44K shares at an average price of TL36.40 on 6 June 2022. Since 25 May 2022, the total number of shares bought back reached 470K at an average price of TL35.73.
*THYAO, PGSUS and TAVHL > Total PAX in Turkish airports increased by 185% y/y to 15.8mn in May, which was at 93% of its 2019 level... <Slightly Positive for THYAO, PGSUS and TAVHL> According to the statement made by the Minister of Transport and Infrastructure Adil Karaismailoğlu, the total number of PAX increased by 185% y/y to 15.8mn in May 2022. International PAX increased by 253% y/y to 8.6 mn supported by increase in tourism in May 2022 whereas domestic PAX increased by 132% y/y to 7.2 mn during the same period. According to the statement made by Adil Karaismailoğlu, Istanbul Airport’s, main hub of Turkish Airlines, total PAX increased by 210% y/y to 5.6mn in May 2022. In the same period, the total PAX at Antalya airport, which is the most important tourism airport, increased by 266% y/y to 2.6 mn in May 2022. Taking the growth in Istanbul and Antalya as well as the increase in airports in other tourism cities in to account, we consider these figures positive for the aviation sector. Official numbers have not been announced yet.
*ISSEN TI> will pay 0.1/share dividend today and the reference price will be TL 24.04
June 7: May Cash Budget Balance( April -TRY43.7bn)
June 10: April Unemployment rate( March 11.5%)