YATIRIMCI EKRANI

·         TREASURY ACUTIONS THIS WK > Treasury will issue 4 auctions this wk & redeem TL13bn, of which TL4.5bn is public institutions. Will borrow total TL5.5bn from mkt. 2 auctions today: 10yr CPI-linker & 5yr fxd. 2 auctions tmrw: benchmark & 10yr fxd coupon.

 

·         MPC TOMORROW >  We expect the CBT to increase TL RRR 50bp for s/t maturities while keeping policy rate & i/r corridor unchgd.

 

·         BANK DEPOSIT INSURANCE > Published in official gazette => saving deposit guarantee incr’d from TL50k => TL100k (first rise in c.9yrs) for retail only. According to BRSA wkly data, 24% of total customer deposits (excl bank-to-bank) is under deposit guarantee => may climb to 35-40%. +VE => stimulating savings & minor increase in length of deposit duration. -VE => deposit insurance premiums paid to SDIF (Savings Deposit Insurance Fund) to incr => additional burden on NI to be 0.6-0.8%.

 

·         AKCNS 4Q12 RESULTS > 4Q NI @ TL27m => -4% y-y and 18% q-q => in line with cons est @ TL28m but below our TL32m => deviation from operational perf. 4Q EBITDA @ TL52m => in line with cons est @ TL53m vs our TL62m. Domestic sales +6% y-y to TL224m, while there was a 13% y-y fall in exports, resulting in a 2% y-y rise in rev. EBITDA margin -50bps y-y to 19.2%. 4Q12 EBITDA margin fell behind our 22.7% est due to higher than exp’d COGS and OPEX (mainly personnel exp). FY12 EBITDA margin improved 120bps to 20.4%. We expect Akcansa to pay TL0.50/shr divi (yield @ 4.6%) around end-Apr/beg-May.

 

·         TTRAK (HOLD; TP:TL48.5) > Ziraat Bank again raised interest rate subsidies on loans for tractor purchases from 25% to 50% without a price limit. Tractor demand rose sharply to a record high 60K tractors In 2011 when a similar level of subsidy was applied. Recall in 2012, a 50% interest rate subsidy was applied to tractors priced less than TL35,000 and 25% to those between TL35,000 – TL500,000. Last year, the tractor market contracted by 19-20%. Increase in subsidies will have a positive impact this year.

 

·         THYAO TI (BUY, TP TRY8.46) > Signed LoI to acquire MNG Technic, an aircraft MRO provider => to expand its aircraft maintenance capabilities along with ongoing expansion in its fleet. Comment: MNG Technic is a private company (no access to financials) => minor acquisition. THYAO is in the process of roughly x2 its MRO capacity by building 2 new big aircraft maintenance hangars @ Sabiha Gokcen airport (1 expected in 2013) => MNG Technic has facilities @ Istanbul Ataturk & reportedly has rights to build a new one => new space for such facilities is hard to come by @ THYAO’s main hub.

 

·         DOAS (BUY,TP: TL10.50) > Following announcement of revised investment incentive scheme for the auto sector, the govt reiterated its calls to VW to invest in TK => mid-term investment plans of VW don’t include TK. Minister of Eco noted that counter measures could be implemented. In 2011, the govt introduced a special 10% tax (housing support fund) on vehicles imported from the EU with Mexican origin/engine size >1,500 cm3 => targeted VW Jetta imports from Mexico. However, DOAS wasn’t impacted much => pricing support from VW & shift to smaller sized engines. We estimate imports from non-EU account for 15-20% of PC imports of DOAS & 10% of LCV imports. We don’t exp immediate measures against VW & any measure would be coordinated in advance => developments to be under radar screen; NEUTRAL for now.

 

·         HLGYO (NR) > Halk REIT IPO complete @TL1.35/shr & TL894m MCap => 3x oversub. Price implies 26% discount to NAV. Allocation => 71.9% to domestic retail, 18.9% to local institutions and 9.2% to foreign institutions.

 

·         AYGAZ (NR) > Aygaz will apply to CMB to issue a TL150m 2-yr bond (bearing 6-mth fixed-rate coupons) for qualified investors => exp’d int rate 150 to 155 bps abv TR gov’t bills with similar maturities. Comment: We believe the Co plans to use proceeds to finance its likely upcoming equity contribution to AES Entek, Koc Holding’s electricity production JV with US utility company AES, and its likely dividend pymt. However, Aygaz has significant cash on its B/S & relatively strong cash generation capacity. We think the underlying motivation are attractive costs and ease of raising money through the bond market at this time.