Buy - Sell

·         September CAD @ 10 am => TEB-BNPP & Cons expectation @ -$3bn, If inline => 12-month @ $56bn

·         August Unemployment =>  Cons @ 8.7%, July @ 8.4%

·         ISCTR (HOLD, TP: TL 6.01) 3Q12 Low visibility in Earnings: 3Q NI @ TL670m (inline w our TL670m, above cons TL576m) => details not encouraging. We revise our NI forecast +5% & +1% for ’12 & ’13 => driven mainly by lower provision & new pension related provisions => net-net => increases our opex est for 2012. The new provisioning policy is why we lower the specific provisions for both 2012 & 2013. Loans & deposits +0.3% & +2.2% q-q => inline. NIM +17bp @ half of our 33bp forecast => -36bp q-q when adj for FX & trading lines despite better-than-exp 17bp L-D spread expansion => due to lower security yields & higher borrowing costs. NPL ratio +18bp to 2.1% while coverage reduced to 84% from 100% as exp. Adj net CoR +58bp q-q to 49bp => 1st +VE reading since 3Q09. Fees +13% y-y (inline). Adj opex +4% y-y despite also relatively low other provisions which include wage incr yet to be done for 2012.

 

·         TURPS (BUY, TP TL51.40) => 3Q12 NI @ TL555m (+56% y-y); EBITDA @ TL672m (-15% y-y) and Revs @ TL12.9b (+9% y-y). Results +ve surprise (Alper Paksoy go go go!!!). Ebitda beat our est by 10% and NI by 8% (15% above consensus). All this despite nearly halving its purchases from Iran y-y in 3Q12. 9M12 bottom line was +6% y-y despite last year’s 9M11 inflated inventory gains.

Clean gross production refining margins @  avg $12/bbl in 3Q12 according to our est vs. ~$13/bbl a year ago. We estimate margins were supported significantly by nearly doubling y-y of industry’s refining margin on rationalization of capacity. TP raised 6% after 3Q12 results.

 

·         ENKAI (BUY; TP TL5.41) > Real estate surprise on the upside, but contracting margins weak. NI @ $173m (+79% y-y, our est: $149m, cons: $143m). The beat was on non-operating level => higher financial income ($47m vs our est 425m). EBITDA @ $209 (+6% y-y, +25% q-q) in-line with our est, but was abv cons ($196m). Real estate perf exceptionally strong both in margins and revenues => EBITDA $82m, +25% y-y vs our est: $69m. Despite strong contracting revenues @ $427m (+48% y-y), contracting EBITDA @ $59m (-15% y-y, +32% q-q) fell short of our est ($65m). The miss in energy segment’s EBITDA is no cause for concern, as we expect Enka to deliver our full-year est of $261m due to its take-or-pay/cost+ plus agreements.

 

·         MGROS (BUY; TP TL) > EPS in red disappoints even as EBITDA beats. TL17m net loss (+TL91m year ago) => worse than our TL5m and cons’ TL3m net loss est. While TL30m FX losses hurt bottom line as exp’d, higher other expenses & tax drove the bottom line below est. Revenue @ TL1,825m (+13% y-y) => in line. EBITDA @ TL124m beats cons and our est by 8% and 9%, resp’ly => beat on stronger margins => on higher oper leverage effect while opex mgmnt was disciplined across the board. Net/Net: BUY maintained => on the back of growth prospects for organized retailers, and the solid franchise and brand equity of the company. A possible exit of BC Partners from Migros remains a potential strong catalyst, whilst potential ccy weakness remains the key d/side risk => EUR892m debt (w payback of EUR140m over 4Q13-3Q14). The Co will hold an earnings call tdy at 14pm local time.

·         CIMSA (BUY; TP TL10.19) => 3Q12 NI @ TL37m (-21% y-y and -11% q-q) 8% below our est and 9% below CNBC-e con. Net sales +8% y-y to TL244m, EBITDA flat @ TL69m, as higher electricity prices narrowed margins, while higher than expected financial expenses drove EPS lower. Domestic revs +14% y-y to TL200m, demand in the Med expanded while demand in Central Anatolia contracted. Export sales -13% y-y to $34m on weaker export markets. Maintain BUY rating on the back of 19% upside potential.

·         AYGAZ (UR) 3Q Better Oper: NI @ TL122m in 3Q12 (+196% y-y, BNPP: TL102m, CBNCE Cons: TL91m) on EBITDA of TL99m (+27% y-y, BNPP: TL75m, Cons: TL71m) & rev of TL1.40b (+11% y-y, BNPP: TL1.50b,  Cons: TL1.43b). Comment: NI higher than exp on better than exp oper perf => +VE surprise @ EBITDA came partly from higher than exp inventory gains on higher LPG prices qoq) => had announced very poor mrg in 2Q12 on declining LPG prices.

 

·         FROTO (HOLD; TP: TL17.9): General Manager says co carrying out a project to adopt new Transit Custom (already launched) & Transit Courier (new small LCV to be launched) for US market => no decision on exports of these products to US yet. We prev’ly noted 110k units capacity allocated to new Courier model was quite high for EU market & high capacity might be taken as hint that FMC might be considering launching new small LCV in new markets. A decision to export Transit Custom/Courier (if realized) to US would be +VE.

 

·         DYHOL (NR) =>  3Q12 NI @ TL11m, in line with the con est of TL12m. EBITDA @ TL67m was way above the cons est of TL45m on back of a turnaround in the profitability of newspaper publishing segment. Broadcasting segment also improved its operating performance.

 

·         SNGYO (NR)=> 3Q12 NI @ TRY25m (-16%y-y), EBITDA @ TL14m (-47%y-y), Revs @ TL 113m (-47%y-y).

 

EARNINGS TODAY

 

·         DOAS (BUY, TP: TL 6.98) 3Q today, analyst meeting Nov 19:  We exp 3Q Rev, EBITDA & NI @ TL1.2bn, TL75m (+16% y-y) & TL50m vs cons @ TL1.25bn, TL79m, TL51m, resp.  We exp it to be a star performer under our auto coverage in y-y comparisons => strong mkt share gains in 3Q12. Tax purpose financials => good proxy for top-line, lmtd indication for EBIT => highlight 3Q12 top-line will be broadly-in line with our est & possibility for some upside surprise @ EBITDA.