Market Watch (Şeker Yatırım)

Market Watch - Friday, August 16, 2024

Outlook:
 
The BIST100 Index started Thursday on a negative trend, closing the day at its peak of 9,982.98, up 1.55%. The Industrial Index gained 1.71% and the Banking Index rose by 2.79%. Purchases remain curbed in the short term by the lack of any story supporting the Index. However, since we maintain our positive medium-term outlook on the BIST current levels should be considered as a buying opportunity. And so, the positive outlook will strengthen again in the medium term. That said, fluctuations may be expected in the short term. On the global front, recession concerns over the U.S. economy have diminished with the latest data. Yesterday's retail sales data indicated that demand was alive, supporting risk appetite. Markets, which had priced a 125 bps interest rate cut for 2024 last week, are pricing a 75 bps cut this morning. With the incoming data, the recovery in global stock markets continues. Yesterday, the U.S. and European stock markets closed with increases. This morning, the U.S. futures, German DAX futures and Asian stock markets are trading positively. We think that global markets will continue to balance unless incoming data increases recession concerns. The VIOP30 Index completed the evening session flat. Locally, we expect the Benchmark Index to start Friday positively and sail a fluctuating course thereafter. SUPPORT: 9,750 - 9,600 RESISTANCE: 10,250 - 10,500.
Money Market:
The Lira was negative yesterday, weakening 0.05% against the USD to close at 33.6336. The currency also appreciated by 0.14% against a basket of $0.50 and €0.50. Meanwhile, the local fixed income markets were negative. The ten-year benchmark bond yield fluctuated between a tight range of 28.79%-28.87%, closing the day at 28.80%, up 8 bps from the previous close.
Headlines:
*** In July, budget and primary balance posted a deficit of TRY96.8 billion and TRY4.2 billion, respectively. Despite the rigidity in personnel expenditures, the marked improvement in current transfers led to a limited recovery in the budget deficit… According to the July central government budget data released by the Ministry of Treasury and Finance, budget revenues and budget expenditures were realized as TRY730.9 billion and TRY827.7 billion, respectively. In the same period, non-interest budget expenditures were realized as TRY735.1 billion. Accordingly, the budget deficit was realized as TRY96.8 billion while the primary balance posted a deficit of TRY4.2 billion. Increases in personnel expenditures, especially due to inflation, create a structural deterioration in the budget. The significant increase in current transfers in the aftermath of the earthquake brought about unusual levels in the budget deficit. We expect the downtrend in current transfers to continue, led by public austerity measures. The impact of seasonal holiday bonuses on the budget disappeared, while transfers to state-owned enterprises continued. Transfers to the Electricity Generation Co. increased to TRY32.1 billion due to the summer season, and TRY118.9 billion of transfers were made throughout 2024. The retreat in corporate tax collections was compensated by income tax revenues, while the positive trend in SCT revenues continued. As the retreat in the level of monthly inflation will ease price pressures on the budget, the coordination of monetary and fiscal policies will need to be enhanced in the second half of the year. Especially in the current environment where monetary policy is sufficiently tight, a tightening in fiscal policy will bring both price and fiscal stability.
Sector News:
BRSA Weekly: FX deposits rose by USD2.6bn and 1.4% WoW (due to commercial institutions). According to the weekly BRSA data as of August 9, 2024, the sector's FX deposits in ($ terms) rose by USD2.6bn and 1.4% weekly to USD194.2bn. Cumulative growth reached USD6.4bn and 3.3% over the past 5 weeks.
The share of FX deposits in total deposits rose by 60bps weekly to 38.1%. State deposit banks' FX deposits rose by 0.9% while foreign and private deposit banks' FX deposits rose by 2.4% and 0.9% WoW, respectively. Individual and commercial institutions' FX deposits rose by 0.3% and 3.4% weekly. Official institutions' FX deposits rose 0.2% WoW.
Ongoing outflow in Currency protected deposits. Weekly outflow in KKM fell to 2.8% from 3.7% weekly. The total amount fell by TRY49.3bn to TRY1.71 trillion. Its share in TRY deposits fell by 50bps weekly to 16.3%. In dollar terms, it also fell by 3.3% WoW to USD51.6 billion. The share of KKM deposits also fell 150bps to 26.6%.
Loan growth rate lost momentum. The 13W moving average (FX adj.) total lending growth eased to 28% from 29.3% in the previous week.
Total consumer loan growth rose to 31% from 29.4%. Consumer and commercial credit card growth eased to 38.2% and 26.1% from 39.9% and 35.8%, respectively. The commercial installment loan growth rate improved to 37.7% from 36.2%.
Limited rise in TRY deposits. TRY deposits rose by 0.2% weekly. Individual deposits fell 0.2% while commercial and other institutions' deposits rose 0.6% and 1.6% weekly.
Sector's FX long position rises WoW. The sector's FX long position rose 5% weekly to USD2,130 million. State deposit banks' FX long position rose by 7% weekly to USD1,476 million, the sharpest growth among peers. In foreign deposit banks, it rose by 1% weekly to USD569 million. For private deposit banks it rose by 2% weekly to USD168 million. The sector's FC net general position/regulatory ratio rose 10bps to 2.3% weekly. On a segmental basis, this rate is 5.4% and 2.6% for state and foreign deposit banks, and 0.6% for private deposit banks.
Company News:
Cimsa (CIMSA.TI; UR) has announced a net profit of TRY 1,278mn for 2Q24. In 2Q23, net profit had been at TRY 1,272mn. In 2Q24, sales revenues decreased 21.8% y-o-y to TRY 5,762mn (2Q23: TRY 7,371mn). EBITDA of TRY 1,460mn was generated in 2Q24 (2Q23: TRY 1,560mn), and the EBITDA margin increased by 4.1pp to 25.3% (2Q23 EBITDA margin 21.2%).
Erdemir reported a net profit of TRY 4,368mn (2Q23: TRY 3,909mn loss) in 2Q24. Our estimate was for a net profit of TRY 2,538mn, and the market's was for a net profit of TRY 2,907mn. Operational performance was in line with our expectations. However, a lower financing expense than we had expected plus tax income despite our tax expense expectations chiefly explained the deviation from our net profit expectation. In 2Q24, the company recorded TRY 1,354mn of net financial expenses and TRY 1,321mn of tax expenses.
In 2Q24, Erdemir printed TRY 50,470mn of revenues (+35% YoY) above our TRY 49,224mn estimate and below the market's TRY 51,976mn call. In 2Q24, the company recorded a 1,956k ton sales volume, somewhat in parallel with our 1,994k ton expectation (2Q23: 1,653k tons). Recall the production halt at Isdemir's facilities from February to mid-April (due to the earthquake).
The Company booked TRY 6,388mn of EBITDA; above our TRY 6,087mn estimate and below the market's TRY 6,450mn estimate. EBITDA per ton was realized at USD102, somewhat above our USD97 estimate.
Net debt up... The Company's net debt position rose to TRY61,756mn at the end of 2Q24 from TRY54,384mn at the end of 1Q24. The Net Debt/EBITDA ratio remained flat at 2.55x, thanks to strong EBITDA.



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                               Yasal Uyarı
 
  Burada yer alan yatırım bilgi, yorum ve tavsiyeler yatırım danışmanlığı kapsamında değildir.Yatırım danışmanlığı hizmeti ; aracı kurumlar, portföy yönetim şirketleri, mevduat kabul etmeyen bankalar ile müşteri arasında imzalanacak yatırım danışmanlığı sözleşmesi çerçevesinde sunulmaktadır.Burada yer alan yorum ve tavsiyeler, yorum ve tavsiyede bulunanların kişisel görüşlerine dayanmaktadır.Bu görüşler mali durumunuz ile risk ve getiri tercihlerinize uygun olmayabılır.Bu nedenle, sadece burada yer alan bilgilere dayanılarak yatırım kararı verilmesi beklentilerinize uygun sonuçlar doğurmayabilir.