Buy - Sell

·    FROTO (HOLD, TP: TL 17.4): Ford Motor Company (FMC) announced on Oct 25 it expects a $1.5b+ loss from European ops in 2012 & therefore announced a restructuring program (prev: $1b+ loss=> Will close 3 European facilities (Southampton, Genk, Tooling & stamping operations in Dagenham), decreasing European capacity by 18% (gross annual savings of $450m -500m)=> Transit assembly plant in Southampton (c.28k Transit production in 2011) to be closed & Transit production to be consolidated in Kocaeli/Turkey (est. 2H13) => Transit has highest rev/vehicle & highest mrg w/i FROTO’s portfolio => assuming incremental 25k units (9% of 2012E production) & no incremental Capex need => c.+10% on our DCF val for FROTO (to be partially negated by worsening outlook on mrg for 2013 than our current est indicate). Following relocation decision, FROTO might need to adjust capacity allocation b/w basic Transit models (160k units as of 2014) & Transit/ Tourneo Custom (130k units) => to have a balanced CUR b/w 2 lines in l/t => will recheck production numbers & Capex requirement if any. Restructuring plan of FMC can also facilitate more competitive pricing for PC ops of FROTO in mid-term => -VE trend in mrg of FROTO is not only driven by its ageing LCV product portfolio, but also uncompetitive pricing against VW brands in PC. NET/NET: +VE for FROTO given weakening outlook for 2013 => however we believe market was already partially pricing some positive developments on new sourcing arrangements. DIVIDEND: FROTO TRY0.65/share divi on Oct 31.

 

    Opel - PSA announcement & TOASO (BUY; TL9.25) > On Oct 24, Opel and PSA announced key steps in their global strategic alliance which includes next steps in joint purchasing organization, and four common vehicle platform development projects. The Alliance aims to launch the first vehicles on these common programs by end-2016. Impact on Tofas => possibly limited, but unconfirmed for now: we believe the most critical item that could impact Tofas could be the joint program for a compact-class Multi-Purpose Van

Buy - Sell

AKBNK (BUY, TP: TL8.80) => Borrowed $500m via a 5-year Eurobond at US treasury rate +328bp and $500m via a 10-year Eurobond at US treasury rate +345bp, according to Bloomberg. This indicates respective costs of 3.95% c.120bp and 5.15% c.155bp wider than Turkish government Eurobond yields with same maturities.

 

THYAO (U/R) => To add 20 new routes in 2013 according to local daily citing chairman’s comments to local TV channel. Comment: Growth impact => Only ~2%-3% in 2013. While THYAO flies to more than 200 destinations currently, new routes usually start off at low frequencies. We also assume opening of new routes will be spread over 2013.

 

AEFES (AEFES TP TL25.52) => The CMB approved AEFES’s application for a $500m debt issue. AEFEs did not specify reason behind, but believes the current environment is very favourable for new debt issue. Currently borrows @ LIBOR+250bps.  Mandated banks for a planned bond sale of $500m with 5,7 and 10 year maturities. We believe AEFES is looking at acquisition opps in Eastern Europe and nearby regions and would like to raise debt beforehand.

 

TURPS (BUY, TP TL 48.60) => Up to $1b of bonds, TUPRS plans to issue, have been registered by the CMB according to the board’s weekly bulletin issued yesterday. No further details are available as to pricing, maturity and the exact amount the company might issue eventually. The amount to be issued would most probably depend on the pricing according to our previous discussions with management. Comment: We expect TURPS will use bond proceeds to replace some banking debt it uses to finance its working capital (~$1.2b as end-1H12 according to our estimates).

 

AKSEN (HOLD, TP TL4.13)=> CMB approved AKSEN’s application to increase paid-in capital by 6.2% to TRY613m, first announced in April 2012. Recall that under the deal, AKSEN will sell the issued shares to GS at $2.94 per share. GS will also own a put option with a strike price of $2.94/share to return shares to AKSEN. The transaction will have no impact on the current share price.

 

ASELS (N/R) => State Tender Institution will require the Turkish Armed Forces Foundation and its subsidiaries to hold tenders for its procurements, according to daily Zaman. Negative for Asels.

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Aksa Enerji Report

·    Bolu plant: The company is expected to secure US$240mn loan from GARAN and ISCTR for the plant, which will be financed with 75/25 debt/equity ratio. The company has already obtained a US$30mn bridge loan as a part of the financing. The plant is expected to be operational in two phases until YE15 with a US$320mn investment in total. We value the project at TL427mn but apply 25% discount due to lack of financing. The completion of the financing will add 6% upside to our valuation.

·    Receivables from Kazancı Holding: The parent currently has nearly TL400mn debt to AKSEN and expects to pay a meaningful amount in one year. Note that the Holding assured AKSEN to pay its debt fully until YE2014.

AKSEN-ULKER-BMEKS-ENKAI Bilanço Analizi

AKSEN 2012'in 1. çeyreğinde 146 mn TL kar açıklayan Şirket, yılın ikinci çeyreğinde zararını 2011 yılı aynı dönemine göre %90.2 artırarak 10.1 mn TL olarak açıkladı. Cnbc-e Beklentisi 12.26 mn TL kâr olması yönündeydi. Şirketin satış gelirleri geçen yılın aynı dönemine göre %11.6azalırken FAVÖK'ü 23.8 azalarak 60.5 milyon TL olarak gerçekleşmiştir.

ULKER 2012'in 1. çeyreğinde 55.8 mn TL kar açıklayan Şirket, yılın ikinci çeyreğinde karını 2011 yılı aynı dönemine göre %92.6 düşürerek 43.3 mn TL olarak açıkladı. Cnbc-e Beklentisi 32.89 mn TL kâr olması yönündeydi. Şirketin satış gelirleri geçen yılın aynı dönemine göre %20 azalırken FAVÖK'ü %54 artarak 45.2 milyon TL olarak gerçekleşmiştir.

BMEKS 2012'in 1. çeyreğinde 1.8 mn TL kar açıklayan Şirket, yılın ikinci çeyreğinde karını 2011 yılı aynı dönemine göre %96.4 düşürerek 96.1 bin TL olarak açıkladı.

ENKAI 2012'in 1. çeyreğinde 326.8 mn TL kar açıklayan Şirket, yılın ikinci çeyreğinde karını 2011 yılı aynı dönemine göre %4.1 artırarak 207.8 mn TL olarak açıkladı. Cnbc-e Beklentisi 262.82 mn TL kâr olması yönündeydi. Şirketin satış gelirleri geçen yılın aynı dönemine göre %40 azalırken FAVÖK'ü %43.8 azalarak 344.4 milyon TL olarak gerçekleşmiştir.