Excluding Aksigorta from our top picks:We exclude Aksigorta <Buy, TP: TL11.15> from our top picks portfolio due to recent negative news flow. TL depreciation is expected to weigh on technical profitability as some of the claims are linked to FX, especially in Motor Own Damage (MOD) segment. While we expect the company to reflect this to its prices, there will a be a negative impact in the short term until the current policy portfolio is fully repriced. On the other hand, recent news reports suggest the increase in the minimum wage will exceed the expectations, which should be negative for the company as it will lead to a rise in provision amounts. We continue to like Aksigorta’s long term prospects and find the valuation attractive, though headwinds might restrain the share price in the short-term.
Following the exclusion of Aksigorta, the constituents of our model portfolio are Pegasus, Kardemir, Coca Cola Icecek, MLP Care, Arcelik, Tofas, Alarko Holding and Enerjisa. Our Top Picks portfolio has outperformed the BIST-100 by 19.4% YTD.
ÜNLÜ & Co