Buy - Sell

·         CBRT meets analysts today. Look out for view post Fitch upgrade.

 

·         TREASURY REDEMPTION > Net redemption TL7.4bn. We see net excess liquidity of the banking sector to increase by TL7.1bn, even if the CBRT does not open a repo auction. We think the CBRT is likely to keep liquidity abundant to limit the TL’s appreciation.

 

·         TAVHL TI (BUY, TP TL12.50) > TAV Airports’ terminal passenger traffic rose by 31% yoy to 6.4m passengers in Oct 2012 (+32% y-y in Sep). Number of passengers 57.7mn for the first ten months; +33% y-y growth.  Comment: Strong growth as we had expected. Slight slow-down from previous months also in line with our expectations. Like-for-like growth, i.e. growth without Medina and Izmir domestic ops, which TAV Airports took over at the beginning of January and July 2012 respectively, was 16% y-y for Oct and 19% ytd. C

 

·         THYAO (HOLD, TP TL4.35) => Announced that no decision taken yet on potential closer cooperation with Lufthansa beyond existing ties, which remains at “contemplation stage”, and that there had been no communication so far with Lufthansa mgmt regarding this issue. The two are reportedly in talks to take minority stakes in each other. Comment: We think a merger between the two companies or joint mgmt is unlikely since THYAO is not an EU airline. Possible that the two cos may still take minority stakes in each other but believe would not be an attractive option for either airline. A more probable case is closer operational cooperation or the two companies merging/taking stakes in each others’ airline service ventures – although benefits would be limited. Closer alignment of networks/deeper code sharing agreement unlikely to be very significant for either airline in terms of growth as their hubs are too close to each other.

 

·         UYUM (HOLD; TP TL3.45) > Uyum Gida started preliminary talks with Tesco Kipa for the sale of a majority stake in Uyum. Recall that in the previous transaction in June, where 10% of the company was sold to Fimar Holding, the price was TL3.34/share. Given yesterday’s closing share price of TL3.41, control premium should dictate upside potential from here on. Note that the deal could most likely trigger a tender call.

 

·         ISGYO (NR) => ISGYO announced its Izmir project “EGE Perla” yesterday. EGE Perla is a mixed project with 170 units and a mall. Total investment value c $150m and expected to be completed in Dec ‘15.

 

Earnings today

 

·         ALBRK (BUY; TP TL1.56) > TEB-BNPP NI @ TL50m, Cons @ TL49m. We expect ALBRK to achieve strong 6% q-q growth in total deposits in 3Q12 accompanied by slower loan growth of 2%; c20bp wider margins and 8% q-q NII growth; relatively steady asset quality; net CoR +27bp from -17bp in 1H12; steady y-y fee & opex growth evolutions with growth rates of 28% and 32%, respectively. Should result in second best 21% q-q rise in NII among banks we cover => indicates 6% q-q and 28% y-y increase in bottom line => ROE 18%.

 

·         TEBNK (NR) > Consensus NI TL115m.