Garanti Securities - Equity Strategy - Model Portfolio Update

RESEARCH

Please see the last page of this report for important disclosures.

1

The latest outcome in the political arena suggests that volatility will continue in the Turkish equity market, which has underperformed other emerging equity markets by 19% so far this year. When we analyze the MSCI Turkey Indexs 1 year forward looking P/E discount to the MSCI EM Index since 2008, we find that the deepest discount was around 45% during the 2008-2009 global financial crisis. Following the December 17 corruption investigation amid political uncertainty at the end of 2013, the discount had deepened to its current level of 26%. Therefore we expect the BIST to deepen its discount level against its peers; at the Friday closing (81,943), it had a 1 year forward P/E multiple of 10.2x - close to its historic average - and traded at a discount of 19% to the MSCI EM. With the index initially seeking support, the 78,900-75,000 and 70,000 levels could emerge as a support range. With the TRY weakening, rising interest rates and mounting uncertainties over domestic demand, we expect public banks, companies with high levels of FX debt and revenues with a high level of dependence of domestic demand to exhibit a relatively weak performance; whereas companies with FX based revenues and a focus on exports could remain defensive. In this context, we remove VAKBN from our Model Equity Portfolio while adding TSKB. We remove AKSEN and MGROS, which are both burdened by high FX debt, while adding ENKAI. Among aviation stocks, we replace THYAO with TAVHL. Accordingly, our Model Equity Portfolio consists of the following stocks: AKBNK, TSKB, CIMSA, ENKAI, TAVHL and TKFEN.

Source: Garanti Securities

Garanti Model Portfolio vs. BIST 100 Index

Model Portfolio Performance*

Model Portfolio return since last update** -3.5%

BIST 100 return since last update -3.1%

Relative portfolio return since last update -0.4%

Model Portfolio return (Ytd) -6.5%

BIST 100 return (Ytd) -4.4%

Relative portfolio return (Ytd) -2.2%

* Model Portfolio's performance is calculated with an equal weighting given to the selected stocks.

**Last update: 25 May 2015

0

200

400

600

800

1000

12.0

804

.09

08.0

912

.09

04.1

008

.10

12.1

004

.11

08.1

112

.11

04.1

208

.12

12.1

204

.13

08.1

312

.13

04.1

408

.14

12.1

404

.15

Model portfolio BIST 100

Model Portfolio Performance as of 8 June 2015

Stock Included on # of days in portfolio Nominal return Relative Perf. vs. BIST

100 Index 12-M Target Share

Price Upside

AKBNK 11.03.2015 86 6.7% 1.9% 9.50 22%

CIMSA 18.05.2015 18 -6.5% 1.2% 19.30 27%

ENKAI 05.06.2015 0 0.0% 0.0% 6.06 18%

TAVHL 05.06.2015 0 0.0% 0.0% 20.65 -6%

TKFEN 05.02.2015 120 -19.3% -15.5% 7.00 53%

TSKB 05.06.2015 0 0.0% 0.0% 2.14 20%

June 8, 2015

Equity Strategy - Model Portfolio Update

Model Portfolio Performance as of 8 June 2015

Stock Included on # of days in portfolio Nominal return Relative Perf. vs. BIST

100 Index 12-M Target Share

Price Upside

AKSEN 25.05.2015 11 0.0% 3.2% 3.80 36%

MGROS 31.03.2015 66 0.7% -0.6% 26.70 27%

THYAO 19.08.2014 290 39.8% 35.2% 11.90 32%

VAKBN 17.10.2014 231 1.5% -6.4% 6.25 40%

EMISPDF intellinet from 78.173.38.216 on 2015-06-28 14:59:53 BST. DownloadPDF.Downloaded by intellinet from 78.173.38.216 at 2015-06-28 14:59:53 BST. EMIS. Unauthorized Distribution Prohibited.

RESEARCH


1

The Turkish banking index underperformed its emerging market peers 21% Ytd and we expect the weakness to continue after the election results, in view of the market volatility in terms of interest rates and the FX market. The main source of pressure since the beginning of the year was the sticky deposit rates stemming from domestic and global volatility, and it is highly likely that banking sector will face increasing funding costs in the coming period. Moreover, the already subdued demand in the commercial and consumer loan segment will hit the banking sectors top-line. In the light of recent developments, we shift to a defensive portfolio in our banking preferences. We add TSKB to our Model Equity Portfolio given its more stable funding structure with no exposure to the TL deposit market. On the other hand, we keep AKBNK in our model portfolio due to its ability to defend bottom-line given the defensive asset structure and strong fundamentals. We believe that HALKB and VAKBN will underperform their peers in the coming period due to their high TL funding structure and state exposure, and hence remove VAKBN from our Model Equity Portfolio. In our view, we believe that it is highly likely that we will see more cheap and attractive levels in the banking index in the coming period, so ISCTR will be on our radar screens in the event of a strong retreat due to its strong asset quality. Our banking coverage trades at a 2015E P/E of 8.2x and P/BV of 1.0x, implying 12% and 24% discounts, respectively. Moreover, our banking index discount against emerging peers had reached to 11% and 15% respectively, close to the deepest discounts seen in the past 3 years.

Source: Bloomberg, Garanti Securities

June 8, 2015

Equity Strategy - Model Portfolio Update

MSCI TR , MSCI EM 1 year fwd looking P/E



3

June 8, 2015 Model Portfolio Update RESEARCH

Top Picks Akbank Current/Target Price: TL7.76 / 9.50 Upside Potential: 22%

(TLmn) 2013 2014 2015E 2016E

Net Income 2,942 3,160 3,482 3,893

Total Assets 183,737 205,451 224,797 252,634

Sh's Equity 21,339 25,112 28,137 31,402

Loans/Deposits 105% 111% 113% 115%

NIM 4.2% 4.1% 4.2% 4.1%

Cost/Income 37% 38% 37% 37%

P/E 10.6 9.8 8.9 8.0

P/BV 1.5 1.2 1.1 1.0

ROAE 13.8% 13.7% 13.1% 13.1%

ROAA 1.7% 1.6% 1.6% 1.6%

Stock Market Data

1mth 3mths 12mths

2% 3% -3%

256.2

-9

Free float (%): 42

YTD TL Return(%):

Market Cap (TLmn): 31,040

Average Daily Vol (TLmn) 3 mth:

Relative Performance:

52 Week Range (TL): 7.01 - 9.33

Summary Financials & Ratios

Valuation Multiples

05 June 2015

5.00

6.00

7.00

8.00

9.00

10.00

01.1

402

.14

03.1

404

.14

05.1

406

.14

07.1

408

.14

09.1

410

.14

11.1

412

.14

01.1

502

.15

03.1

504

.15

05.1

506

.15

AKBNK BIST100

Akbank is trading with 2015E P/E of 8.9x and P/BV of 1.1x, with a ROE expectation of 13.1%. On the other hand, in terms of P/E, the last 5 year average premium of Akbank compared to sector is 20%, which is currently 11%. On the back of strong core capital ratio and asset quality, strong funding base, cost efficiency, and ongoing shift in the asset mix in favour of loans, Akbank is one of the most resilient banks in volatile times. Akbanks Tier I capital ratio is at 13.2% (peers: 12.2%), allowing the bank to grow faster than the peer averages in the medium-term. Following 1Q15 results, Akbank maintains its 2015YE guidance, with the management warning of some risks, especially regarding the NIM due to the weak currency and volatility in the interest rate market, and also at the Opex line due to the fee repayments. Therefore, while we maintain our expectation of no change in the NIM, we have raised our cost growth forecast from 10% to 12% YoY for Akbank.

Cimsa Current/Target Price: TL15.15 / 19.30 Upside Potential: 27%

(TLmn) 2013 2014 2015E 2016E

Net Sales 954 1,094 1,183 1,291

EBITDA 236 318 331 363

Net Income 302 193 213 208

EBITDA Margin 24.8% 29.1% 28.0% 28.1%

Net Margin 31.7% 17.6% 18.0% 16.1%

P/E 6.8 10.6 9.6 9.8

EV/Sales 2.3 2.0 1.9 1.7

EV/EBITDA 9.5 7.0 6.8 6.2

EPS (TL) 2.24 1.43 1.58 1.54

Dividend Yield 8% 9% 10% 10%

Stock Market Data

1mth 3mths 12mths

-6% -4% 19%

2.6

3

Free float (%): 40

YTD TL Return(%):




52 Week Range (TL): 12.03 - 16.65


Valuation Multiples

05 June 2015

8.00

10.00

12.00

14.00

16.00

18.00

01.1

402

.14

03.1

404

.14

05.1

406

.14

07.1

408

.14

09.1

410

.14

11.1

412

.14

01.1

502

.15

03.1

504

.15

05.1

506

.15

CIMSA BIST100

Cimsa exhibited a relatively robust operating performance compared to the sector average in 1Q15. The Company is planning to renovate and triple the capacity at its Afyon plant, which is expected to enter operation in 4Q16. We believe the new factory will add value to Cimsa by boosting sales and margins. Moreover, the Company started to step up its focus on the high margin white cement segment. In addition to the aforementioned factors, Cimsas regional diversification, as well as its export capabilities, enable it to cope with regional competition and weak domestic demand. We believe Cimsa offers a good long term investment opportunity. Cimsa trades at 2015E 6.8x EV/EBITDA and 407x EV/Clinker (TL/tonnes) multiples, at 15% and 9% discounts to the sector averages, respectively.



4


Top Picks Enka Insaat Current/Target Price: TL5.15 / 6.06 Upside Potential: 18%

(TLmn) 2013 2014 2015E 2016E

Net Sales 12,288 12,728 14,380 14,867

EBITDA 1,951 1,929 847 2,372

Net Income 1,248 1,441 1,640 1,714

EBITDA Margin 15.9% 15.2% 5.9% 16.0%

Net Margin 10.2% 11.3% 11.4% 11.5%

P/E 16.5 14.3 12.6 12.0

EV/Sales 1.3 1.3 1.1 1.1

EV/EBITDA 8.3 8.4 19.0 6.8

EPS (TL) 0.31 0.36 0.41 0.43


Stock Market Data

1mth 3mths 12mths

0% 15% -3%

21.2

10

Free float (%): 12

YTD TL Return(%):




52 Week Range (TL): 4.22 - 5.4


Valuation Multiples

05 June 2015

4.00

4.60

5.20

5.80

6.40

7.00

01.1

402

.14

03.1

404

.14

05.1

406

.14

07.1

408

.14

09.1

410

.14

11.1

412

.14

01.1

502

.15

03.1

504

.15

05.1

506

.15

ENKAI BIST100

Enka has been an underperformer recently. The Company underperformed the BIST-100 by 4% in the last 10 days. Following election period, we expect Enka Insaat to remain defensive in a volatile environment. Although the Companys backlog retreated to US$2.43bn, following 1Q15 results, Enkas net cash position remained firm at US$2.8bn. Iraq continue its dominance in the backlog with 41% share. Despite the ongoing unrest in Iraq, we understand that Enka is determined to maintain a long term presence in Iraq and is well positioned to win further energy contracts. The recent upward trend in oil prices is a market positive for Enkas business regions, we therefore expect the backlog to improve in the upcoming period. We also expect the real estate business in Russia to continue to be a cash cow and we do not see any major problem in the occupation rates for the rest of the year. The Companys mainly US$ denominated business, its strong presence in the markets it has business make the Company one of the defensive stocks in the market.

Tav Havalimanlari Current/Target Price: TL22.00 / 24.20 Upside Potential: 10%

(TLmn) 2013 2014 2015E 2016E

Net Sales 2,595 2,648 3,184 3,326

EBITDA 1,018 1,231 1,432 1,501

Net Income 336 634 689 784

EBITDA Margin 39.2% 46.5% 45.0% 45.1%

Net Margin 13.0% 24.0% 21.6% 23.6%

P/E 23.8 12.6 11.6 10.2

EV/Sales 4.5 4.4 3.6 3.5

EV/EBITDA 11.4 9.4 8.1 7.7

EPS (TL) 0.93 1.75 1.90 2.16


Stock Market Data

1mth 3mths 12mths

2% 13% 26%

21.4

19

Free float (%): 41

YTD TL Return(%):




52 Week Range (TL): 15.47 - 23.6


Valuation Multiples

05 June 2015

12.00

14.40

16.80

19.20

21.60

24.00

01.1

402

.14

03.1

404

.14

05.1

406

.14

07.1

408

.14

09.1

410

.14

11.1

412

.14

01.1

502

.15

03.1

504

.15

05.1

506

.15

TAVHL BIST100

We see TAV as a defensive name with solid fundamentals. We believe another round of outperformance seems in the cards ahead of likely market volatility post elections (June 7) on the back of i) the anticipation of strong near term earnings, ii) its position as the main beneficiary of anticipated strong demand in the sector given attractive prices on lower oil prices and competition, iii) a less unfavourable currency mismatch given the EUR weakness and iv) work falling behind schedule on Istanbuls new airports. TAV targets 6-8% total pax growth (up 8% YTD) for the 2015 full year with an 8-10% rate of growth in pax numbers using Istanbul Ataturk Airport (8% YTD). The Company expects to generate 10-12% revenue growth (20% in 1Q15) and 12-14% EBITDA growth (18% in 1Q15), while stating its expectation of a 5-10% improvement in net profit (50% in 1Q15). Considering the YTD trend, it appears that the Company is on course to meet its targets. Our forecasts are in line with the guidance.



5


Top Picks Tekfen Holding Current/Target Price: TL4.57 / 7.00 Upside Potential: 53%

(TLmn) 2013 2014 2015E 2016E

Net Sales 3,846 4,475 4,166 4,550

EBITDA -24 287 350 354

Net Income -64 56 219 247

EBITDA Margin n.m. 6.4% 8.4% 7.8%

Net Margin n.m. 1.2% 5.3% 5.4%

P/E n.m. 30.2 7.7 6.8

EV/Sales 0.4 0.4 0.4 0.3

EV/EBITDA n.m. 5.5 4.5 4.5

EPS (TL) -0.17 0.15 0.59 0.67


Stock Market Data

1mth 3mths 12mths

-5% -13% -21%

45.0

-21

Free float (%): 43

YTD TL Return(%):




52 Week Range (TL): 4.54 - 6.17


Valuation Multiples

05 June 2015

4.00

4.60

5.20

5.80

6.40

7.00

01.1

402

.14

03.1

404

.14

05.1

406

.14

07.1

408

.14

09.1

410

.14

11.1

412

.14

01.1

502

.15

03.1

504

.15

05.1

506

.15

TKFEN BIST100

Despite an expected economic slowdown in Tekfen Construction's major operating regions due to lower oil prices, we expect Tekfen Holding to be positively affected by long-awaited project awards and the positive impact of the fertilizer investments in 2H15. Tekfen Construction ended 1Q15 with a US$2.2bn backlog, compared to the US$2.4bn backlog at the end of 2014. The contracting segment recorded TL485mn of revenues in 1Q15, down by 20% YoY, and a 3.8% EBITDA margin in 1Q15, down by 4.7pp YoY. The company guides for a FY15 EBITDA margin of 6.9% for the segment. In 1Q15, Toros Tarim increased its sales volume by 8% YoY, expanding its market share by 2pp QoQ to 30%. The Company guides 10.6% EBITDA margin for the segment in 2015, following the high base of 15.3%.

TSKB Current/Target Price: TL1.78 / 2.14 Upside Potential: 20%

(TLmn) 2013 2014 2015E 2016E

Net Income 326 391 418 439

Total Assets 12,911 14,808 16,273 17,916

Sh's Equity 1,885 2,234 2,593 2,937

Loans/Deposits 70% 61% 62% 63%

NIM 2.0% 1.6% 1.8% 2.0%

Cost/Income 14% 17% 18% 20%

P/E 9.6 8.0 7.5 7.1

P/BV 1.7 1.4 1.2 1.1

ROAE 18.1% 19.0% 17.3% 15.9%

ROAA 2.8% 2.8% 2.7% 2.6%

Stock Market Data

1mth 3mths 12mths

0% 5% 19%

6.7

5

Free float (%): 40


Valuation Multiples

05 June 2015


52 Week Range (TL): 1.41 - 1.84

YTD TL Return(%):



1.10

1.30

1.50

1.70

1.90

2.10

01.1

4

02.1

4

03.1

4

04.1

4

05.1

4

06.1

4

07.1

4

08.1

4

09.1

4

10.1

4

11.1

4

12.1

4

TSKB BIST100

We view TSKB as a solid banking play in the Turkish banking space with its unique business model and low risk profile. TSKBs defensive business model stems from its unique funding structure, with a long-term and relatively low cost nature, with funds channeled into the investment financing needs of the corporates and SMEs. Thus, we think TSKBs investment bank model has a perfect fit in the current environment of volatile interest rates and deposit costs. We believe rising deposit costs and the depreciation of the TL will favour TSKB as the bank has no exposure to the deposit market or the weak TL, meaning a high reported NIM for TSKB as the bank lends in FX but books in TL. TSKB has no currency or duration mismatches in its lending activities. TSKB trades at a P/E multiple of 7.5x and a P/BV of 1.2x in its 2015E, pointing to a 21% discount and 23% premium compared to our sector average. We think TSKB is poised for more of a re-rating than other Turkish banks on the back of its higher ROE-generation capability and relatively low risk profile.



6


Performance of Our Model Portfolio vs. BIST-100 (TL return)

-6.5%-4.4%

-2.2%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

ResearchOutperform List

BIST-100 Index Relative

2015

45%

26%

15%

0%

10%

20%

30%

40%

50%



2010

-10%

-22%

16%

-30%

-20%

-10%

0%

10%

20%



2011

73%

53%

14%

0%

14%

28%

42%

56%

70%



2012

-14% -13%

-0.4%

-20%

-14%

-8%

-2%

4%

10%



2013

41.7%

26.4%

12.1%

0.0%

9.0%

18.0%

27.0%

36.0%

45.0%



2014

PERFORMANCE OF OUR OUTPERFORM LIST

TL US$ TL US$ TL US$ TL US$ TL US$ TL US$

Our Outperform List 0.7% -1.8% -5.8% -19.6% -6.5% -18.3% 32.5% 6.0% 14.4% -23.7% 98.4% 40.7%BIST-100 Index 2.0% -0.5% -3.9% -18.0% -4.4% -16.5% 20.9% -3.3% 4.8% -30.1% 59.8% 13.3%Relative Performance

Since 2012

24.1%-1.3% -2.0% 9.6% 9.2%-2.2%

3 mths 6 mths Since 2014 Since 20132015



7


Recommendation List 05.06.2015 Ticker Rating Close Upside Market Cap.

(TL) Potential (US$mn) 2015E 2016E 2015E 2016E 2015E 2016EFINANCIALSBanks Banks 7.8 6.5 0.93 0.84 13.6% 14.0%Akbank AKBNK OP 7.90 9.50 20% 11,864 86.3 9.4 7.8 1.22 1.11 13.4% 14.9%Garanti GARAN - 8.52 - - 13,434 335.7 - - - - - -Halkbank HALKB OP 13.35 19.55 46% 6,265 134.4 6.0 5.2 0.90 0.78 15.9% 16.2%Isbank ISCTR OP 5.61 7.25 29% 9,478 91.6 7.5 6.1 0.85 0.76 13.5% 13.2%Vakifbank VAKBN OP 4.51 6.25 39% 4,233 116.5 6.3 5.7 0.73 0.66 12.1% 12.2%YKB YKBNK MP 4.08 5.75 41% 6,659 41.0 9.3 7.2 0.87 0.79 9.7% 11.5%TSKB TSKB OP 1.78 2.14 20% 1,169 2.6 7.5 7.1 1.20 1.06 17.3% 15.9%

Ticker Rating Close Upside Market Cap.(TL) Potential (US$mn) 2015E 2016E

ConglomeratesAkfen Holding AKFEN MP 6.50 7.15 10% 639 0.6 16.8 15.6Dogan Holding DOHOL UR 0.66 - - 648 6.0 - -Koc Holding KCHOL MP 12.25 13.90 13% 11,663 27.0 12.8 10.4Sabanci Holding SAHOL OP 10.05 11.90 18% 7,699 25.5 8.4 7.2Sise Cam SISE MP 3.47 3.70 7% 2,215 4.9 9.7 8.1

Ticker Rating Kapan Upside Market Cap.(TL) Potential (US$mn) 2015E 2016E 2015E 2016E

REICEmlak Konut REIC EKGYO OP 2.80 3.90 39% 3,995 34.4 8.0 7.1 7.3 6.5Is REIT ISGYO OP 1.60 1.81 13% 448 2.7 17.1 7.8 13.7 7.7Sinpas GYO SNGYO MP 0.76 1.10 45% 171 1.5 - - 29.0 22.4Torunlar REIC TRGYO OP 3.62 4.30 19% 680 1.5 2.9 2.8 13.4 6.8

Ticker Rating Kapan Upside Market Cap.(TL) Potential (US$mn) 2015E 2016E 2015E 2016E 2015E 2016E

INDUSTRIALS 12.6 11.0 9.5 7.9 6.9 1.2Adana Cement ADANA UP 6.58 7.20 9% 218 0.4 8.6 9.2 7.3 7.5 2.2 2.2Anadolu Efes AEFES MP 22.90 27.54 20% 5,091 2.7 22.1 17.6 8.5 7.5 1.5 1.3Akcansa AKCNS MP 15.70 18.70 19% 1,128 1.2 11.5 10.5 7.9 7.2 2.1 1.9Ak Enerji AKENR MP 1.03 1.60 55% 282 3.2 - 57.2 12.7 10.3 2.1 1.8Aksa Enerji AKSEN OP 2.81 3.80 35% 647 4.7 - 10.8 9.0 7.4 1.5 1.4Anadolu Cam ANACM OP 1.95 2.50 28% 325 1.9 11.8 8.0 5.0 4.6 0.9 0.9Anel Elektrik ANELE UR 1.09 - - 45 0.9 8.2 5.7 7.1 6.7 0.6 0.6Arcelik ARCLK OP 14.35 17.18 20% 3,640 8.8 13.4 12.2 8.4 7.7 0.9 0.8Aselsan ASELS MP 13.85 13.87 0% 2,600 4.4 16.9 11.8 12.4 10.6 2.3 2.0Aygaz AYGAZ OP 10.10 11.37 13% 1,138 1.2 9.4 9.4 8.1 8.0 0.5 0.4Bagfas BAGFS MP 13.55 15.85 17% 229 4.5 20.3 13.5 12.9 9.5 1.6 1.3Banvit BANVT OP 2.60 3.70 42% 98 0.7 6.8 4.6 5.6 4.6 0.4 0.3BIM BIMAS MP 47.60 52.20 10% 5,425 14.6 25.2 20.8 16.5 13.5 0.8 0.7Bizim Toptan BIZIM MP 14.15 19.35 37% 212 2.6 25.7 18.9 7.4 6.3 0.2 0.2Brisa BRISA MP 8.27 9.71 17% 947 1.9 9.9 9.0 8.2 7.3 1.6 1.5Bolu Cement BOLUC MP 5.38 6.70 25% 289 0.8 9.0 7.2 6.5 5.8 2.2 1.7Coca-Cola Icecek CCOLA OP 44.35 59.50 34% 4,235 4.7 19.4 16.1 10.6 9.0 1.9 1.6Cimsa CIMSA OP 15.35 19.30 26% 778 1.1 9.7 10.0 6.9 6.2 1.9 1.8Dogus Otomotiv DOAS - 16.70 - - 1,379 3.7 - - - - - -Enka Insaat ENKAI OP 5.16 6.06 17% 7,749 10.8 12.6 12.0 15.1 6.1 0.9 1.1Eregli Demir Celik EREGL MP 4.56 4.80 5% 5,992 22.6 12.2 12.1 7.1 6.8 1.4 1.3Ford Otosan FROTO OP 34.45 33.43 -3% 4,539 5.0 17.3 13.0 9.9 8.1 1.1 0.9Gubretas GUBRF MP 6.74 7.36 9% 845 3.6 10.8 10.0 4.1 3.7 0.7 0.6Indeks INDES OP 5.47 7.50 37% 115 0.3 8.7 7.2 8.5 7.2 0.2 0.2Kardemir KRDMD MP 1.63 2.20 35% 477 28.5 5.5 4.9 5.0 4.6 1.2 1.0Mardin Cement MRDIN UP 4.32 5.01 16% 178 0.3 8.4 7.5 6.1 5.6 1.9 1.7Migros MGROS OP 20.95 26.70 27% 1,400 5.6 30.4 22.1 9.6 8.7 0.6 0.5Otokar OTKAR MP 87.10 71.70 -18% 785 19.0 21.8 24.6 13.6 14.4 1.7 1.8Petkim PETKM MP 3.81 4.32 13% 1,430 11.4 23.1 17.8 9.7 7.7 0.7 0.6Pegasus PGSUS OP 25.15 39.80 58% 966 19.7 8.8 6.9 6.7 5.5 0.8 0.7Soda Sanayii SODA MP 5.93 6.02 2% 1,120 1.8 10.1 8.8 6.5 5.7 1.5 1.4Tat Konserve TATGD MP 6.00 4.90 -18% 306 2.1 24.0 18.1 13.4 11.8 0.9 0.8TAV Airports TAVHL MP 21.90 20.65 -6% 2,987 8.3 13.2 12.0 8.3 7.8 3.4 3.2Tekfen Holding TKFEN OP 4.61 7.00 52% 640 18.7 7.7 6.8 4.5 4.5 0.4 0.3Turkcell TCELL MP 12.20 13.95 14% 10,077 42.9 14.1 11.5 5.7 5.4 1.8 1.7THY THYAO OP 9.09 11.90 31% 4,709 105.6 7.1 6.5 7.4 6.7 0.9 0.8Tumosan TMSN UR 7.26 - - 313 26.3 17.7 14.9 11.6 9.8 1.7 1.5Tofa TOASO MP 17.40 16.73 -4% 3,266 8.1 11.7 9.7 7.5 5.8 1.2 0.9Trakya Cam TRKCM OP 2.90 3.93 36% 805 3.6 9.6 8.1 5.3 4.8 1.0 0.9Trk Telekom TTKOM N/R 7.32 - - 9,619 8.8 - - - - - -Trk Traktor TTRAK MP 72.40 82.00 13% 1,451 2.3 13.5 12.0 10.8 9.7 1.6 1.5Tpra TUPRS OP 64.65 77.20 19% 6,078 27.8 10.7 8.8 7.9 6.7 0.6 0.5Unye Cement UNYEC MP 4.32 5.36 24% 200 0.1 7.7 6.8 5.4 5.1 1.7 1.5

Target Price*

Avg. Vol. **

P/E P/BV ROE

Target Price*

Avg. Vol. **

P/E Adj.NAV Prem. / Disc.(TLmn) to adj. NAV

2,831 -40%- -

32,267 -4%30,400 -33%6,752 -13%

Target Price*

Avg. Vol. **

P/E EV/EBITDA P/BVTrailing

1.21.00.40.5

Target Price*

Avg. Vol. **

P/E EV/EBITDA EV/Sales


Disclaimer Model Portfolio stock picks have been selected among equities with an Outperform (OP) recommendation by the Research department, considering both long term financial data based company analysis and short term expectations. The Model Portfolio revision report sets out the reasons why a stock may be promoted to the portfolio or demoted from it; a stocks entry to or exit from the Model Portfolio does not imply that its long term recommendation has been changed. The Model Portfolio is a virtual portfolio based on the equally weighted cumulative performance of the stocks it contains. Therefore, any changes made to and within the Model Portfolio may not necessarily correspond with investors risk-reward preferences. This document and the information, opinions, estimates and recommendations expressed herein, have been prepared by Garanti Securities Research Department, to provide its customers with general information regarding the date of issue of the report and are subject to changes without prior notice. All opinions and estimates included in this report constitute our judgment as of this date and are subject to change without notice. This document and its contents do not constitute an offer, invitation or solicitation to purchase or subscribe to any securities or other instruments, or to undertake or divest investments. Neither shall this document nor its contents form the basis of any contract, commitment or decision of any kind. Investor who have access to this document should be aware that the securities, instruments or investments to which it refers may not be appropriate for them due to their specific investment goals, financial positions or risk profiles, as these have not been taken into account to prepare this report. Therefore, investors should make their own investment decisions considering the said circumstances and obtaining such specialized advice as may be necessary. The information in this report has been obtained by Garanti Securities Research Department from sources believed to be reliable. However, Garanti Securities cannot guarantee the accuracy, adequacy, or completeness of such information, and cannot be responsible for the results of investment decisions made on account of this report. The market prices of securities or instruments or the results of investments could fluctuate against the interests of investors. Investors should be aware that they could even face a loss of their investment. Transactions in futures, options and securities or high-yield securities can involve high risks and are not appropriate for every investor. Indeed, in the case of some investments, the potential losses may exceed the amount of initial investment and, in such circumstances, investors may be required to pay more money to support those losses. Thus, before undertaking any transaction with these instruments, investors should be aware of their operation, as well as the rights, liabilities and risks implied by the same and the underlying stocks. Investors should also be aware that secondary markets for the said instruments may be limited or even not exist. This report is to be distributed to professional emerging markets investors only. This report is for private use only and intended solely for the individual(s). No information in this report may be copied, modified, republished or exploited in anyway without the prior consent of Garanti Securities. Additionally, with respect to our statements above, all our claims and plea rights are covered in the regulations which apply in the countries that this report has been sent to. Garanti Securities Etiler Mah. Tepecik Yolu Demirkent Sokak No:1 34337 Besiktas, Istanbul / Turkey Phone: +90 (212) 384-1155 Fax: +90 (212) 352-4240

OUTPERFORM (OP) The stock's return is expected to exceed the return of the BIST100 over the next 12 months.

MARKET PERFORM (MP) The stock's return is expected to be in line with the BIST100 over the next 12 months.

UNDERPERFORM (UP) The stock's return is expected to fall below the return of the BIST100 over the next 12 months.

Definition of Stock Ratings

RESEARCH

RESEARCH


Documents

Garanti Securities - Equity Strategy - Model Portfolio Update