Is Private Equity
Continuing to weather the storm
14 March 2019
During a turbulent year for the Turkish financial markets and economy, the 1.2% increase in NAV per share reported by Is Private Equity (ISGSY), supported by good growth in real terms by investee companies, is a very positive outcome. With some calm returning to Turkish markets, a further moderation in inflation and interest rates would be positive and a pick-up in M&A activity may provide opportunities for the capital recycling that ISGSY targets. MORE »
Continuing to weather the storm
11 March 2019
During a turbulent year for the Turkish financial markets and economy, the 1.2% increase in NAV per share reported by Is Private Equity (ISGSY), supported by good growth in real terms by investee companies, is a very positive outcome. With some calm returning to Turkish markets, a further moderation in inflation and interest rates would be positive and a pick-up in M&A activity may provide opportunities for the capital recycling that ISGSY targets. MORE »
Valuation yet to reflect improving conditions
16 March 2018
The overall valuation of Is Private Equity’s (ISGSY) private equity investments remained resilient in 2017, with gross asset exposure to these investments increasing (and liquid assets reduced) as ISGSY invested further, for larger stakes in existing assets. With economic recovery taking hold, investee companies saw total revenue growth of c 35% in 2017, and the increased investment may prove to be well timed, especially if inflation and interest rates decline as the Central Bank expects. A pick-up in M&A activity may also provide additional opportunity for capital recycling from mature assets into new opportunities. The significant 52% discount to NAV provides scope for a re-rating. MORE »
Valuation yet to reflect improving conditions
16 March 2018
The overall valuation of Is Private Equity’s (ISGSY) private equity investments remained resilient in 2017, with gross asset exposure to these investments increasing (and liquid assets reduced) as ISGSY invested further, for larger stakes in existing assets. With economic recovery taking hold, investee companies saw total revenue growth of c 35% in 2017, and the increased investment may prove to be well timed, especially if inflation and interest rates decline as the Central Bank expects. A pick-up in M&A activity may also provide additional opportunity for capital recycling from mature assets into new opportunities. The significant 52% discount to NAV provides scope for a re-rating. MORE »
Weathering a storm
17 March 2017
Is Private Equity (ISGSY) makes direct private equity investments in mid-sized Turkish companies with the aim of providing capital gains and attractive dividends. 2016 was a year of considerable uncertainty in Turkey, creating challenging market conditions for ISGSY’s investee companies and for the wider Turkish economy. Despite this, valuations have remained resilient, with a like-for-like fall of 2.5% versus a reduction of c 4% in 2015, which was arguably a less turbulent year. Including a further TRY10m investment in one of its leisure businesses, PE investments comprised 54% of total assets at 31 December 2016, up from 51% at the end of FY15. The discount to NAV remains over 50%, but further political stabilisation following a referendum in April 2017 could cause this to narrow. MORE »
Economic headwinds continue
15 March 2016
Is Private Equity (ISGSY) seeks to provide capital gains and attractive dividends from making private equity (PE) investments in Turkish companies. Market conditions were challenging for investee companies in 2015 and the fair value of its PE investments fell by c 5%, although still higher than the initial investment costs. Investment income from its other investments resulted in flat NAV per share before dividend payments. ISGSY’s PE investments amounted to 51% of total assets at year-end 2015, from 38% at end 2014, as it added to one PE holding and made one new acquisition. It has a relatively immature PE portfolio and we do not anticipate disposals in the near term, although it did sell a small part of a stake in one holding during the year to a strategic investor. ISGSY could have paid a 2015 cash dividend out of retained earnings but, given the exceptionally low level of profits and the current level of economic uncertainty, it decided not to and retain the cash for new investment opportunities. MORE »
Facing economic headwinds
29 September 2015
ISGSY targets capital appreciation and eventual realisation gains from its Turkish private equity investments, meanwhile seeking to pay attractive dividends. The half-year valuations of these were held at end-2014 levels and will be revalued at year end. Market conditions remain challenging for investee companies. We do not anticipate disposals from ISGSY’s relatively immature private equity investments in the near term. Rather, management seeks opportunities to invest its large cash and liquid asset pool (45% of total assets, 46% of NAV). Earnings on financial investments more than covered the 2014 dividend. In 2015, lower market yields suggest this is unlikely to be the case, although historic earnings reserves would provide ample room to maintain the dividend. MORE »
NAV stable after large dividend payment
3 March 2015
Is Private Equity (ISGSY) aims to achieve capital appreciation and a dividend return by directly investing in Turkish companies. In the year to 31 December 2014 its NAV increased by 1% and it paid a dividend equivalent to 7.9% of the current share price. The fair value of the PE investments was flat during the year and financial income was largely offset by general administrative expenses and the dividend payment. Its discount to NAV at 37% is in line with its long-term average and gives investors some protection from the heightened uncertainty surrounding Turkey and investments in emerging markets. MORE »
