Smartiks Yazılım (SMART TI) - International: a smart way to grow: Initiating at Buy
Smartiks Yazılım was established in 2006 as a software and software support services provider. The expansion of its client portfolio and strong international sales drove revenue/EBITDA/net profit CAGRs of 19%/25%/25% over 2015-18.
Smartiks completed its IPO on 16 May 2019, receiving cash worth TRY18m. On top of the capital increase, 1.25m shares were sold at an average price of TRY3.09, on 17 May, pouring a further TRY3.87m cash into the company. This cash flow turned the company’s net debt position into a strong net cash one. Also, some IPO proceeds will be used as working capital to grow business segments further. Consequently, we expect the company’s net profit to grow by a CAGR of 39% over 2019-21.
We initiate coverage on Smartiks with a BUY rating and target price of TRY4.49, which offers an attractive 76% upside potential. Also, in terms of P/E and EV/EBITDA multiples, Smartiks trades at 69% and 79% discounts, respectively, to local and international peers.
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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