TFG Istanbul Morning Report (TFG Istanbul Menkul Değerler )

Tax HikeÒHigher InflationÒGood for BIST
" MSCI Asia is down by 0.2% after lower than expected GDP growth data from China, similar to EU and US futures as they are also slightly down this morning. We could have expected a flattish opening for BIST had there been no tax hike. We expect higher taxes to feed into inflation, which should prompt investors to prefer stocks instead of TRY deposits, as the negative real interest on the latter will even get higher. In all we expect the up-move on BIST to prevail.
" Special consumption tax has been increased threefold for natural gas used by houses and on fuel. Fuel prices jumped by over 20%. Hakan Kara, the former chief economist of the CBRT expects 2pp addition on inflation for July and August cumulative inflation, which may climb up to 5pp by year-end. Higher inflation and weaker TRY are constructive for BIST companies, most of which have FX income streams or final products with low demand elasticity. Due to lack of appealing investment alternatives, we envisage more savings to switch into equities as well as FX. Elevated inflation expectations should push up TRY time deposit yields, but this is unlikely to take place immediately. We expect solar panel producers and renewable energy companies to benefit from the SCT hike. Aviation sector may benefit from the SCT hike as well since jet fuel is exempt from SCT. So travellers should prefer air travel to expensive alternatives. Thematically we expect automobile companies to face negative impact, while electric car demand should go up. AGHOL and TCELL has 23% stake each in domestic electric car TOGG.
" The Ministry of Treasury and Finance stated that the SCT increase in fuel products aimed at reducing the effect on the budget due to additional costs caused by the earthquake, and that it would also support controlling the current account deficit.
" Vice President Yilmaz stated that in terms of public revenues, the measures we have been taken so far would be enough and he did not think that there would be a new study until the end of the year.
" We have issued a 2Q23 preview for banks. Akbank is set to have the best q-q and y-y profit evolution. Please check www.tfgistanbul.com for details.
AGENDA
" Domestic Budget Balance for June will be released in Turkey.
" President Erdogan will visit Saudi Arabia, Qatar and the UAE on 17-19 July.
" Egyptian President Sisi will pay an official visit to Turkey on July 27.

COMPANY NEWS:
" ALARK: A term sheet has been signed on 14/07/2023 between The Company's subsidiary Alarko Tarim Sanayi ve Ticaret A.S. and Halil Pekdemir Ciftligi Gida Ltd Sti. with the purpose of, i. establishing a new company that owns approximately 310.000 m² land including approximately 120.000 m² greenhouse, through partial division of Halil Pekdemir Ciftligi Gida Ltd Sti., ii. granting the newly established company the right of use for two geothermal hot water wells that are based on geothermal resource operation license for 8253.75 hectare area in Denizli province, Saraykoy district which is valid until 15/09/2041, iii. transferring the shares of the newly established company to Alarko Tarim Sanayi ve Ticaret A.S.
" BIMAS: As per Morroco World News, BIM unveiled its plans to introduce "Made in Morocco" products into its Turkish network. Under the new initiative, BIM's stores in Turkey will offer Moroccan textile products that meet international standards while remaining competitively priced. This news is expected to strengthen BIM's international business segment's growth going forward.
" THYAO: It was announced that it was decided to establish a company with the title of THYAO - AJet Air Transport, and to continue the activities of AnadoluJet brand under AJet Air Transport. The company also announced that it has been decided to start the necessary studies for the establishment of an electronic money and payment services institution and the execution of the licensing processes.
" GESAN: It has been announced that US$7.5mn of roof and self-consumption SPP orders have been received for from SISECAM, for its factories in Ankara and Eskisehir.
" TURSG: In the January-June period, premium production increased by 117% to TL 24.4 billion.




 TFG Istanbul Menkul Değerler A.Ş.
  www.tfgistanbul.com/arastirma-raporlar
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                  Yasal Uyarı
 
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