Buy - Sell

·         TREASURY AUCTIONS > 10y bond yield eased in line with US yields to 10.2% but remain @ elevated lvls. Today, the Treasury will auction 15m bonds &  7y FRN => need to sell total TL 2.1bn to mkt in order to reach the monthly borrowing target of TL 9.5bn. Short duration of auctions will help. Moreover, cash account of Treasury is comfortable @ TL 25.4bn as of 21 Aug, which should cushion any weakness in demand. If CBRT turns significantly more hawkish, through a verbal intervention, yield curve will flatten further.

 

·         THYAO TI (BUY, TP TL10.35) 2Q12 Better than our expectations > NI @ TL144m in 2Q13 (-29% y-y, BNPP est: TL224m, CNBCE Cons: TL293m) on EBITDA of TL737m (+42% y-y, BNPP: TL635m, Cons: TL727m) & rev of TL4.61b (+20% y-y, BNPP: TL4.52b, Cons: TL4.76b). 2.5ppt y-y improvement in EBITDA mrg to 16% was more than x2 our exp to 16% is good news for mrgns going forward => +VE surprise from lower than exp unit costs (lower fuel acquisition prices in 2Q13 & slightly better than expected yields). NI miss => sizeable deferred tax charge & higher than exp financial exp. A large portion of +VE surprise seems to have come from lower than exp fuel acquisition costs => cost item difficult for THY to control. Avg P/E for 2013E & 2014E more than 40% below those of its peer avg (vs major discounts to peers in the past. Don’t think justified given its significantly higher growth prospects).

 

·         TAVHL TI (BUY, TP TL16.50) > 2Q13 Results Good > NI EUR37m for 2Q13 (+1% y-y, BNPP est: EUR41m, TAV surveyed cons: EUR36m) on adj. EBITDA of EUR111m (+31% y-y, BNPP: EUR96m, Cons: EUR98m) & adj. rev of EUR315m (+16% y-y, BNPP: EUR305m, Cons: EUR312m). Oper perfor strong & above our expectations due to 24% incr in no of passengers served. EBITDA mrg expanded 4 ppt y-y in 2Q13 to 35%, indicating slight ups risk to our FY forecast of 32% (1H13 29%). Given volatility in its Qly mrg, we prefer to maintain our forecasts & val.

 

·         KOZAA (BUY; TP TL4.13) > posted TRY48m NI, beating our est of TL30m on better oper perf (EBITDA: actual TL157m vs our est @ TL141m) and higher-than-expected financial income. Relatively better results due to lower-than-expected losses in media and food ops. However, impact on share price should be limited, as profitability is mainly driven by KOZAL. Another major catalyst for the stock is potential news-flow on the copper mining project in Konakli.   

 

·         SNGYO (NR) 2Q13 RESULTS > Revs @ TL 197m +163% q-q, -7% y-y, EBITDA @ TL 52m +92% y-y, NI @ TL 32m +64% y-y ; (no consensus).

 

·         TRGYO (NR) 2Q13 RESULTS > Revs @ TL 50m (cons. TL 54m) +6% q-q, +35% y-y, EBITDA @ TL 23m (cons. TL 29m) -6% q-q, +7% y-y, NI @ TL -8m (cons. TL -15m). The company was hit by TL63m in financial exp (net) in 2Q13.

 

·         GUBRF (BUY; TP TL20) posted TL13m NI, broadly in line with our est of TL12m but lower than consensus @ TL21m. Oper perf (EBITDA @ TL59m) also in line with our est (TL62m) but lower than consensus est (TL79m). Impact of lower nitrogen fertilizer prices hurt profitability in 2Q13.

 

·         ASYAB (HOLD, TP TL1.97 ) > Applied to the CMB for a sukuk bond of up to TRY1.25b/Sl +ive, as the issue will provide the bank with better liquidity management

 

·         ALNTF (NR) > Bank announced TRY607.8m IFRS BV, corresponding to TRY2.89 tender price with 3% upside potential vs yesterday's closing price. Slightly below the TRY2.94 price that we derived in mid-August. No date for tender announced but expected in September.   

 

·         BIMAS (NR) > Teleconference highlights > In 2Q13, LFL basket size grew 5.6% y-y (sl above BIMflation at 5.4%) => marks an improvement vs past three Qs. Customer traffic growth continued to be decent @ 5.1% y-y.. BIMAS believes it can reach the upper end of 350- 400 store opening guidance in 2013 in TR. New store opening in Egypt suspended for now. BIM has 26 stores in Egypt, and suspended new store openings. Had targeted +30 stores in Egypt in 13YE. Turkish retail environment: Notes that weakening macro outlook and protests in June has not impacted grocery retail environment negatively.