Dec. 2 (Bloomberg) -- Emlak Konut Gayrimenkul Yatirim Ortakligi AS, the state-run property developer, surged in Istanbul on the first day of trading after Turkey’s biggest public offering this year.
Emlak Konut gained 20 kurus, or 12 percent, to 1.90 liras at 5:30 p.m. It was the most-traded share on the bourse, with 858 million liras ($576 million) worth of shares changing hands.
“Emlak Konut will always be on top of the list for stock market investors, who are looking to have exposure to the growing real estate market of Turkey,” said Mehmet Ilgen, a trader at Ata Invest in Istanbul. “In terms of market capital size and liquidity it will also be easy for investors to put in their portfolios.”
Six Turkish real estate investment trusts have sold shares to the public this year, taking advantage of rising demand for homes after interest rates plunged to a historic low. Istanbul-based Emlak Konut, which has assets worth about 6.9 billion liras, buys land from state institutions such as the Treasury, army and roads authority, and then hires contractors to build housing compounds, sharing the revenue with them.
Emlak Konut’s IPO on Nov. 26 raised 1.06 billion liras ($714 million) via a 25 percent stake sale.
The offering was for 625 million new shares at 1.70 liras each, near the lower end of the range of 1.60 liras to 2.15 liras announced by Chairman Erdogan Bayraktar earlier in the month. Three quarters of the shares were sold to international institutional investors, Bayraktar said.
“Demand may increase further in the coming days and I guess the stock will be one of the ISE-30 index stocks in the following months,” said Altug Dag, a trader at EFG Istanbul Securities.
Emlak Konut is majority owned by government housing agency Toki.
The company would use assets from the IPO for new projects, CEO Murat Kurum said on Nov. 5. Emlak Konut has 5 million square meters (1,236 acres) of land available for those projects, he said.
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