Gedik Investment Shared Its New Stock Suggestions

Gedik Investment shared its new stock suggestions. Before we go into the article, let us state that this is not an investment advice. According to an interview with the Chairman of the Competition Authority, in the visual media last weekend, the news that another investigation is being carried out on the retail sector, which may result in 'higher than before' penalties, was published. It was also mentioned in the interview that the investigation would be completed by the end of April. The Board had fined a number of chain markets and suppliers with a total of 2.7 billion TL. Accordingly, among the publicly traded companies, Bim was fined 958 million TL, Migros 517 million TL and Şok Marketler 384 million TL. Unfortunately, Migros and Şok shares in our model portfolio at that time had a negative impact on our portfolio performance. Therefore, despite the well-managed and cheap multipliers of both companies in this period when we are again uncertain about the penalty, we are removing the shares from our model portfolio at this stage. Considering that both stocks are trading with low single-digit PD/EBITDA multipliers and are operationally in perfect harmony with the current local macro environment, we would like to state that we will not hesitate to add these two stocks back to our Model Portfolio when this uncertainty is resolved. Isbank has achieved a relative return of 1.2% since it was included in the portfolio on January 25, 2022. (absolute return: 1.8%). In the same period, the banking sector underperformed by 11% compared to the BIST-100 Index. The reason for removing İşbank is that we want to add Akbank without increasing the weight of banks in the portfolio. The reason for adding Akbank to our model portfolio is that we think that the current macro environment supports the Bank in reaching its 30% return on equity target for this year. In fact, we would like to point out that this target has upside potential. Reasons for this: 1) The bank has a significant CPI-indexed bond portfolio of approximately 56 billion TL (28% of the securities portfolio and 7% of the active portfolio). The CPI expectation of 30% was assumed in the annual budget of the bank. In addition, every 100 basis point change in CPI is expected to affect the return on equity by +/- 50 basis points and create an additional income/expense of +/- 400mn TL to profitability. 2) The sale of Turk Telekom shares held by banks to the Turkey Wealth Fund has been completed, and this transaction, including Türk Telekom's dividend, will create an additional TL 2,236 million in cash in Akbank's safe as of 2Q22, and this amount will benefit additional earnings. . According to our 2022 projections, the stock is trading at 0.42x PD/DD and 1.6x P/K. At the same time, we would like to point out that the stock has underperformed by 15% compared to the BIST 100 since the beginning of the year, as we believe this presents an opportunity to invest in stocks.