Kafein Yazılım (KFEIN TI) - Comfortable with 2019 targets: Maintain Buy
We met with Kafein Yazılım management to get an understanding of the recent developments and also their expectations for 2H. Considering the business volume generated until August-end, management feels comfortable about reaching its y-y growth target of 40% at the net profit level in 2019.
The receivable collection period from Turk Telekom had risen to six months as of 2017, from the typical three months, probably due to shareholder problems. The problem worsened and this period rose to nine months in 2018. However, Turk Telekom’s receivable collection period has come down to 5-6 months in 2019, which we think will have a positive impact on Kafein’s cash flow. Note that the share of revenue generated from Turk Telekom in Kafein’s total revenue is more than 20% in 2018.
Kafein’s 45% fintech subsidiary KTEC offers a platform that enables consumers to avail consumer financing while shopping through a wide merchant network. KTEC targets more than TRY6m revenue generation and NPM of around 40% in 2020.
TEB Investment equity research analysts and strategist team consists of 8 analysts with an average finance sector experience of 15 years and special focus on international investors.
With our 6 equity research analysts we cover 93 companies across 21 sectors, reflecting 80% of the total market capitalization of all BIST companies and 86% of the BIST100 companies. Our strategy team provides in depth top-down and bottom-up market views with insight on FX and bond markets by publishing sectoral and strategic reports both in English and Turkish.
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