Buy - Sell

·         CPI (JUNE) @ 10AM > TEB-BNPP & Cons @ +0.1% and +0.15%, respectively. If in line with TEB est, annual inflation rises to 7.5% vs. 6.51% in May. The spike in CPI has been well flagged by the CBRT due to food price increases and a strong base effect.

 

·         BIZIM (d/grd to HOLD fr BUY; TP to TL31.70 fr TL36.30) > on CoE revision & share outperformance (since the 1Q13 results release, o/perf’d the BIST100 by 20%) => i) increase our RfR assumption from 7% to 8.5%, and revise EPS estimates, ii) lower our 2013E EPS by 7% & 2013 EBITDA margin est fr 3.8% to 3.6%, due to Bizim’s on-going investments on pricing, but incr our revenue f/cast by 2%.Trades @ 2015E P/E of 23x vs peer avg of 19.8x, and iii) trim our terminal EBITDA margin est fr 4.9% to 4.7% (2012A: 3.5%). Bizim will need to be aggressive on pricing to incr penetration in the C&C segment. So, net impact of improving customer/product mix on margins might be more limited than we previously exp’d. Metro Group might integrate Real (12 stores) to C&C in TR => we think low probability that all stores can be integrated (some are located close to Metro C&C stores). Nonetheless, rapid expansion in Metro C&C’s coverage could be a competitive threat. Opex mgmt amid a shift of customer mix towards more service-intensive-end, financing exp mgmt, perf of new stores & faster-than-exp’d growth in organised retail trade are the main risks. Faster growth in the share of private labels is a key upside risk.

·         DOHOL (BUY, TP TL1.23), DYHOL (HOLD, TP TL0.73) > D-Smart’s CEO told press that D-Smart is interested in acquiring Digiturk as merging D-Smart with Digiturk will create synergies. He also mentioned that the merger will reduce broadcasting and programming costs and increase service quality, benefitting consumers. In our view, acquisition of Digiturk by D-Smart will generate value as D-Smart is not generating enough return. Digiturk has also been suffering from low subscriber base. Hence, a potential merger will produce a much larger subscriber and profit pool for D-Smart and create value for Dogan Group.

teb ytr