Recommendation Change
Equity / Large Cap. / Automotive & Parts
21 January 2010
MARKETPERFORM (D)
Ford Otosan
Bloomberg: FROTO TI
Upside Potential
6%
* Excluding dividend yield
Reuters: FROTO IS
Recovery expectations mostly priced in
Stock Data
TRY
Price at 20 01 2010
11.10
7.60
12-Month Target Price
11.76
7.47
Mcap (mn)
3,895
2,661
Float Mcap (mn)
We are downgrading our OUTPERFORM rating for Ford Otosan to
MARKETPERFORM on valuation concerns despite of the expected strong
bottom-line growth in 2010 over 2009 thanks to recovering export volumes.
We project the Company to distribute TL287mn dividends from its 2009 net
profit in 2010, pointing out to a dividend yield of 7.5%. Our 12-month price
target of TL 11.8 implies 14% total return potential including the estimated
7.5% dividend yield. The stock has outperformed the market by 15% since
our upgrade to OUTPERFORM on December 15th.
US$
701
No. of Shares Outstanding
479
351 mn
Free Float (%)
18.00
Avg.Daily Volume (3M, mn)
4.3
Market Data
2.9
TRY
ISE 100
55,469
US$ Spot Rate
1.4639
US$ 12-Month Forw ard
1.5566
Price Performance (%) 1 Mn
TRY
US$
Relative to ISE-100
25
30
13
3 Mn
12 Mn
24
25
15
202
243
34
Relative
140
Price / Relative Price
12.0 TL
120
10.0
100
8.0
80
6.0
60
4.0
2.0
40
FROTO
Relative to ISE 100
0
0.0
11-07
20
07-08
03-09
52 Week Range (Close TRY)
11-09
4.85
11.10
Esra Sirinel Suner
esuner@isyatirim.com.tr
+90 212 350 25 72
Please refer to important disclaimer at the end of this report.
1
Ford Otosan
Sum m ary of Key Financials (TL m n)
21/01/2010
########
FROTO
######## ######## ######## ######## ########
Incom e Statem ent (TL m n)
2007A
2008A
2009E
2010E
2011E
Revenues
EBITDA
Depreciation & Amortisation
EBIT
Other income (expense), net
Financial expenses, net
Minority Interests
Income before tax
Taxation on Income
Net income
Cash Flow Statem ent (TL m n)
7,231
806
158
648
42
(33)
0
657
(173)
484
7,007
761
162
599
14
4
0
616
(180)
436
5,506
550
165
385
13
6
0
404
(86)
319
6,286
619
167
452
12
(3)
0
462
(97)
365
7,109
722
185
537
16
17
0
570
(120)
450
Net Income
Depreciation & Amortisation
Indemnity Provisions
Change in Working Capital
Cash Flow from Operations
Capital Expenditure
Free Cash Flow
Rights Issue
Dividends Paid
Other Cash Inflow (Outflow )
Change in net cash
Net Cash
Balance Sheet (TL m n)
484
158
5
(126)
520
157
363
0
402
223
184
(56)
436
162
8
(195)
412
48
364
0
439
13
(62)
(118)
319
165
0
274
758
95
663
0
397
(169)
98
(20)
365
167
0
(79)
452
137
315
0
287
16
44
25
450
185
0
(34)
601
193
408
0
328
32
112
137
Tangible Fixed Assets
1,308
1,219
1,153
1,139
1,147
Other Long Term Assets
Intangibles
Goodw ill
Long-term financial assets
Inventories
Trade receivables
Cash & equivalents
Other current assets
Total assets
Long-term debt
Other long-term liabilities
Short-term debt
Trade payables
Other short-term liabilities
Total liabilities
Minority Interest
Total equity
Paid-in capital
Total liabilities & equity
Ratios
0
94
0
3
373
815
360
84
3,038
299
64
117
552
290
1,322
0
1,716
351
3,038
17
68
0
1
584
451
263
103
2,707
228
106
152
204
191
995
0
1,712
351
2,707
0
64
0
1
460
754
343
78
2,848
281
134
82
657
60
1,213
0
1,635
351
2,848
0
49
0
1
524
861
357
89
3,014
231
153
102
748
69
1,302
0
1,712
351
3,014
0
34
0
1
540
974
446
100
3,237
220
173
89
843
78
1,403
0
1,834
351
3,237
ROE (%)
ROIC (%)
Invested Capital
Net debt/EBITDA (x)
Net debt/Equity (%)
Capex/Sales (%)
Capex/Depreciation (x)
EBITDA Margin
EBIT Margin
Net Margin
Valuation Metrics
28.9
25.4
2,039
7%
3.3
2.2
1.0
11.1
9.0
6.7
25.5
23.0
2,119
15%
6.9
0.7
0.3
10.9
8.5
6.2
19.0
15.8
1,774
4%
1.2
1.7
0.6
10.0
7.0
5.8
21.8
20.1
1,824
-4%
-1.4
2.2
0.8
9.8
7.2
5.8
25.4
23.4
1,851
-19%
-7.5
2.7
1.0
10.2
7.6
6.3
0.6x
5.4x
2.1x
8.9x
8.4
8.8
0.2x
2.2x
0.8x
7.4x
11.2
14.6
0.7x
6.8x
2.1x
12.2x
17.0
15.0
0.6x
6.1x
2.1x
10.7x
8.1
7.5
0.5x
5.2x
2.0x
8.7x
10.5
8.7
EV/Sales (x)
EV/EBITDA (x)
EV/IC (x)
P/E (x)
FCF yield (%)
Dividend yield (%)
Company Overview
Production of trucks, minibuses and pickups, spare parts under the license of Ford ;
also import of Ford brand PCs
Shareholder Structure
18%
41%
41%
Ford Motor Company
Koc Group
Other (Float)
EPS Estimates (TL)
1.60
1.40
1.20
1.00
0.80
0.60
0.40
0.20
0.00
2007
2008
2009E
2010E
2011E
Valuation Chart (x)
14.00
P/ E
EV/ EBITDA (r hs)
12.00
10.00
8.00
6.00
4.00
2.00
0.00
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
01/07 07/07 01/08 07/08 01/09 07/09
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21/01/2010
Ford Otosan
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Opinions and estimates contained in this material are not under the scope of investment advisory services. Investment advisory services
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