TFG Istanbul Morning Report (TFG Istanbul Menkul Değerler )

• The BIST100 closed the opening trading session on a loss of 1.84% at 5096, with a noticeable fall in the trading volume of just TRY 76.5bn, as it seems apparent that due to rising interest rates, investors are opting to park their cash on less volatile investment tools.
• The Banks managed to decouple positively from their peers following 4 consecutive days of underperformance, ahead of their 4q22 results, whereas the Transportation stocks were the most sold, due to both profit-taking from last week’s gains, as well as bilateral travel warnings from Turkey-to Europe and vice versa.
• Thus, taking a look at the BIST30 chart, AKBNK, FROTO and KOZAL managed to close in the positive territory, whereas PGSUS, TKFEN and TUPRS were the most sold.
• Today, we expect a slight down opening as selling pressure in global markets continue and warn our readers on the on-going volatility. The best way to tackle with volatility is putting a straddle/strangle on BIST30 options, ie long call & long put.
• As of yesterday’s close, the TRY is trading flat at 18.81 against the USD and at 20.30 against the Euro, after strengthening against both currencies yesterday, whereas the DXY has risen to 102.29. The 2yr yields rose yesterday by 6bps to 10.45%, whereas the 10yr rates rose higher by 17 bps to 10.58%. The 5yr CDS rates rose by 7pts yesterday to 560.
• On the commodity front, Brent has fallen to USD 84.13, and whereas ounce GOLD has retreated to USD 1919, gram GOLD is trading flat at 1160.
• Turkish Foreign Minister stated yesterday that Turkey could agree to Finland’s membership to NATO before Sweden if the military alliance and both Nordic countries agree to it. However Finnish Foreign Minister Pekka Haaivisto dampened that suggestion, saying it was important that Finland and Sweden join NATO at the same time.
• The IMF has maintained its growth rate at 3% in 2023 for Turkey.
• Please note that AKBNK (TFG Est. TRY 21.682bn vs Cons. TRY 20.459bn) and OTKAR (Est. TRY 558mn) will be releasing their 4q22 financials today.
4Q22 FINANCIAL RESULTS:
• ISGYO: Solid results from IS REIT: IS REIT posted TRY62.5mn net profit and TRY109.5mn EBITDA in its 4Q22 financials. The net profit is 10% above the consensus mean, whereas the EBITDA is 75% beyond the expectations as the margin is realised as 67% vs 38% consensus.
NEWS FLOW:
• Turkey Economic Confidence level peaked to its highest level in 1yr to by rising 1.3% to 99.3% from the previous month.
• Tourism: According to sector representatives, the flat USD/TRY parity, but rising costs are hurting the competitiveness of the sector, foreseeing a 5-10% loss in tourism. Please note that the Minister of Tourism targets 60mn tourists with a revenue of TRY 56bn.
• Banking sector’s net profit for full year 2023 jumped by 371% y-y to reach TRY433bn, corresponding to 41% ROE that trails behind the 64% CPI. While we can track the evolution of loans and deposits as frequent as on a daily basis, the sector’s P/L can only be tracked through the monthly bulletin. The December numbers have utmost importance as they shed a light on potential outcome of final quarter earnings. Accordingly, the aggregate q-q profit of private sector deposit banks are expanding by 19% in 4Q22 according to the sector data, beating the consensus by 4pp. State deposit banks on the other hand have managed to increase their bottom-line by 64% q-q, whereas the consensus is looking for 33% profit growth for Vakif+Halk. Obviously the largest state bank Ziraat should have a much larger influence on the overall number. In all, we believe that while the private banks may post numbers that are a tad above the expectations, the size of beat could be larger for state bank peers.
• ULUUN: Disclosed that it will install annual capacity of 37,200 ton pasta cutting line as to diversity its product line.
AGENDA:
• On the local front, December Trade Balance will be released (Est. TRY -10.40bn), as well as the Foreign Tourist Arrivals, whereas on the international arena, China PMI, Eurozone GDP, and the U.S. Conference Board Consumer Confidence reading will be released.

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