Buy - Sell

·         BANKING DATA UPDATE => Total loans +2.0% QTD, as at Dec 4 (TRY +2.5%, FX +0.9%). Gross NPLs +3.7% => NPL ratio of 3.0%. However, NPLs are +c.10% adj for portfolio sales during 4Q12, indicating adj deterioration in the NPL ratio by c.25bp. Total deposits +1.8% QTD (TRY +2.7%, FX flat). With better demand, as well as some window dressing by YE, loans are likely to rise 4-5% q-q in 4Q12 and the NPL ratio should close 2012 @ ~3.0% vs. 2.6% at the beg of the year. By end-Nov, avg new TRY lending rate came down 141bp vs. end-Sep while avg new TRY deposit cost dropped 83bp as of early Dec, indicating c.60bp contraction in the marginal TRY loan-deposit spread. However, given the maturity mismatch, we expect a 50bp+ expansion in loan-deposit spreads on 4Q12 books, which should stabilise in 1Q13 before starting to contract in 2Q13.

 

·         KRDMD (BUY; TP TL1.55) > Kardemir says the high court upheld an earlier Ministry of Labour decision where the Celik-Is (union) was identified as the sole authority to represent workers at Kardemir. Comment: +VE but expected. Celik-Is, which has been representing workers at Kardemir for yrs is less hostile to Kardemir mgmt than Turk Metal. The latter had tried to take over authority to represent workers @ Kardemir in 2010 but had met significant resistance from mgmt and Celik-Is.

 

·         TUPRS (BUY; TP TL52.5) > Mondrian Investment Partners disclosed through Public Disclosure Platform that its stake in Tupras had risen to 5.15% from 4.94% on the purchases it made on Dec. 10, 2012 @ the ISE => worth $14m @ an avg price of TL49.5 /shr. Minority shareholders are required to disclose their stake in an ISE listed company whenever their stake cross 5% or its multiple in either direction. Mondrian’s total stake in Tupras is worth about $350m @ current price.

 

·         AKBNK (HOLD; TP TL9.40) > Reportedly plans to sell a $1bn Eurobond w 1 yr mtry. Bonds could be issued in USD & other ccy with diff. maturities says the bank.

 

·         TCELL (BUY; TP TL12.17) >S&P lowered its outlook on TCELL from +VE to stable & reiterated its BB+ rating => due to shareholder disputes. Says a resolution would be regarded as a positive. Don’t see this as a market mover.

 

·         EKGYO (NR) > Sold 1812 units in Nov (+400% m-m in units and +675% in revenues, largely due to the Agaoglu Maslak Project). YTD total @ 7546 units (2012 guidance @ 10,000 units)

 

·         ALARK (NR) > Reportedly, its wholly owned subsidiary and construction arm Alsim & its partner Makyol will build Levend-Hisarustu metro line & Sanayi-Seyrantepe connecting tunnels. ALARK was up 4.3% yday.