·
Turk Traktor reported
2Q12 net profit of TL102mn (+6% y/y), significantly above our estimate at
TL76mn. Over 40% of the deviation from our forecast is owing to stronger
operating results (much higher average selling prices and slightly better
EBITDA margin). The rest is due to seemingly one-off items such as the reversal
of provisions for doubtful receivables (TL5mn) and gain on sale of fixed assets
(TL3mn).
·
We left the
post-results analyst meeting with the following impressions: i) 2H12 volumes
will be lower than what was observed in 1H12; ii) 2013 domestic volumes are
unlikely to be lower than those of 2012; iii) Product mix is critical
especially at home, a case in point was the introduction of 110hp, more
powerful tractors in May 2012, lifting profits in 2Q12.
·
Turk Traktor has not
provided any new information about the capital expenditure plans for its new
plant (ie. investment size, capacity, timing) saying that the plans have not
been finalized yet. We include an investment budget of TL271mn between
2012-14E in our estimates. 1H12 capex was just TL22mn.
·
We raise our 2012E net
profit forecast by 14% and our 2012E net profit forecast by 19% thanks to
higher price assumptions and the incorporation of 2Q12 findings into our model.
We now predict 12% earnings contraction in 2012E. We are still conservative on
2H12 compared to 1H12 as we continue to predict lower volumes and thus
profitability. Yet, our macro assumptions may prove too cautious for 2H12.
·
Our new 12-mth target
price based on DCF is TL49.5/share, 4% higher than before. We foresee a total
return potential of 44% in Turk Traktor shares in the next 12 months, including
a net dividend yield of 7%. We maintain BUY rating. At 2012E P/E of 7.9x, Turk
Traktor is still cheap. 2012E ROE is 40%.
·
Lower GDP growth,
weaker TL, higher interest rates, lower credit availability, disruption in
government subsidies for agriculture and poor crop lowering farmers’ income
would have a negative impact on Turk Traktor’s revenue and earnings. A higher
than predicted investment budget for the new plant would also lower cash flows
and valuation.
bgc partners
Hiç yorum yok:
Yorum Gönder