TFG Istanbul Morning Report (TFG Istanbul Menkul Değerler )

• The BIST closed Friday on a loss of 0.93% at 5212, and turnover of TRY 94.7bn, with the losses reaching over 3% to touch 5054, after the right-wing Iyi Party quit the 6-member bloc due to disagreement over who should be the presidential candidate, thus throwing the opposition into disarray, ahead of the May 14 elections. However, the panic-selloffs created a buying opportunity for some investors, helping to pare some of the damage. We see the development as a red herring, which will not change the ultimate outcome of the election results in our view.
• The only sector that managed to close in the green was the Industrials, whereas the Banks and Conglomerates performed below par, and the Mining and Aviation stocks were the most sold. On the BIST30 front, ARCLK, GUBRF and VESTL were the best advancers, whereas DOHOL, BIMAS and KOZAL-due to its poor quarterly results, were the most sold.
• As for the week, the BIST managed to rise 3.04%, thanks to the 7.99% gains in the Banks, and strong interest in the Conglomerates and Energy stocks, whereas the REITs diverged negatively from their peers.
• The TRY was flat against the USD, but depreciated by 0.93% against the Euro, and whereas the 2yr bond yields fell by 1.87%, and long-term yields rose by over 10% on a weekly basis. Brent also rose by 3.50%, and ounce GOLD closed 2.41% higher.
• Today, we expect a positive opening at the BIST.
• As of Friday’s close, the TRY is trading flat at 18.90 against the USD, and also flat against the Euro at 20.11, whereas the DXY is trading at 104.52. The 2yr yields closed 14bps lower at 10.49%, whereas the 10yr bond yields rose by 0.83%.
• On the commodity front, Brent is trading slightly lower this morning at USD 85.10, whereas ounce and gram GOLD are flat at USD 1855 and TRY 1126 respectively.
• Over the weekend, The Federal Reserve in the Monetary Policy Report submitted to the Congress indicated that more interest rate increases would be necessary to bring back price stability.
4Q22 FINANCIAL RESULTS:
• ENKAI POSITIVE: 4Q22 numbers came out slightly positive. Net profit and EBITDA numbers came out above market expectations at TRY5,066mn and TRY3,662mn respectively. Net profit was 25% above anticipation while EBITDA exceeded by only 2.5%. EBITDA margin for 4Q22 stood in line with market forecast at 20.9%. Net sales for 4Q22 were TRY17,560mn, 2.5% below consensus.
• EREGL NEGATIVE: 4Q22 financials came out disappointing as the company posted 4Q22 EBITDA of TRY674mn which was 72% below market forecast and 4Q22 net sales of TRY27,248mn which was 17% below anticipation. EBITDA margin for the quarter also came out at 2.5% vs market expectation of 7.2%. While the net profit is seemingly 35% better than expectations, it actually implies a deep loss if we are to exclude the deferred tax reversals.
• GENIL POSITIVE: Posted a substantial net income of TRY415mn in Q422, surpassing market predictions by an outstanding 126%. Although operationally, EBITDA declined by 15.4% quarter-on-quarter, it outperformed expectations by a remarkable 9%. The EBITDA margin of 14.2% was also noteworthy, exceeding anticipated levels by 1.2pp. We deem financial result of GENIL positive due to higher than expected operating margin.
• KRDMD POSITIVE: The EBITDA came in 16% better than expected. Net loss is TRY218mn versus TRY230mn expectation. FX losses and weaker steel margins hit the bottom line. EBITDA of TL685mn was 16% above the consensus of TL587mn. FX losses and weaker steel margins resulted in a major worsening in profitability from last year's high base. EBITDA/ton was down 76% from last year's high base slightly above the consensus forecast of TL7.4bn,. EBITDA fell by 61% y/y with a 76% fall in the EBITDA/ton figure to USD67 from last year's base. TL0.22/share gross dividend will be made in two installments Kardemir decided to distribute a total of TL0.22/share gross dividend, first one until the end of June 2023 and the second one until the end of November 2023. This implies a payout ratio of 11% and 1% dividend yield.
AGENDA:
• Local macro flow is fairly sparse this week, with only the Cash Budget Balance and the Industrial Production to be released, whereas the most compelling macro flow overseas will be the U.S. NPF figures, as well as the ADP and Trade Balance, the Eurozone and Japan will be releasing their GDP growth numbers, Japan will also release its GDP growth numbers, as well as the BOJ policy rate, and China will release its inflation figures. Please note that this week is the final week for companies to release their 4Q22 results. Fed and ECB Heads will also be speaking this week
 
 TFG Istanbul Menkul Değerler A.Ş.
  www.tfgistanbul.com/arastirma-raporlar
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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.