Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Bloomberg Customers

Turkey Riot Trucks Spur Share Gain for Ex-Lawmaker Katmerci

Turkey Riot Trucks Spur Share Gain for Ex-Lawmaker’s Katmerciler
A water cannon-armed truck manufactured by Katmerciler Arac Ustu Ekipman Sanayi & Ticaret AS is seen in this undated handout photograph, released to the media on Aug. 15, 2013. Source: Katmerciler Arac Ustu Ekipman Sanayi & Ticaret AS

Turkey’s anti-government protests are providing a boon to Katmerciler Arac Ustu Ekipman Sanayi & Ticaret AS, the producer of water cannon-armed trucks whose shares are beating Istanbul’s benchmark index.

Images broadcast worldwide of Turkish protesters fleeing the vehicles since demonstrations swept the country in June may help generate business for the Izmir-based company in nations from Brazil to Libya that face social unrest, Chief Executive Officer Mehmet Katmerci said. Sales of dispersion vehicles will rise six-fold this year, he said. Shares have gained 15 percent since the first trading day in June, compared with a 3.9 percent drop in the Borsa Istanbul 100 index.

Katmerci’s father and the company’s founder, Ismail Katmerci, was a former lawmaker in the ruling party of Prime Minister Recep Tayyip Erdogan, whose government ordered 30 of the trucks known as TOMAs on May 16, according to the CEO. The government plans another tender this month for 43 more, he said.

“There’s huge interest in our TOMAs,” Katmerci, 40, said in an interview in Izmir on Aug. 13. “People saw through the world media that Turkey is able to produce such vehicles.”

Katmerciler gained 1.2 percent to 5.14 liras at the close in Istanbul today, bringing its year-to-date increase to 43 percent. The Borsa Istanbul 100 fell 5.4 percent in the period.

Koc Holding

Turkish competitors include Nurol Makina ve Sanayi AS and Otokar Otomotiv ve Savunma Sanayi AS, a unit of Koc Holding, the nation’s biggest group of companies. Shares of Istanbul-based Otokar have fallen 10 percent since the beginning of June, while Nurol, based in Ankara, is privately held.

Erdogan said at a June 16 rally for supporters in Istanbul that the Koc family opened the doors of one of its hotels in the city to protesters, saying the company would “have to account for it.” Tax inspectors accompanied by police raided Koc companies a month later.

In an interview with Vatan newspaper published July 29, Ali Koc, a board member, said the company has no ambitions other than to make Turkey a global player. Chairman Mustafa Koc was out of town when e-mailed yesterday for comment, according to Yeliz Oz Kara, the media relations manager.

The 43 new vehicles Turkish police plan to buy this month will be deployed in Istanbul, Ankara and Kurdish-majority southeastern provinces, according to a Milliyet newspaper report Aug. 13 that Katmerci confirmed. Police are also planning to buy 400,000 canisters of tear gas in preparation for a possible resumption of demonstrations in the fall, the newspaper said.

Positive Outlook

“With a few competitors in the TOMA business, Katmerciler is at an advantage,” Burak Demirbilek, an analyst at Seker Securities in Istanbul who rates the stock outperform, said in a phone interview on Aug. 14. “The government may increase orders after the protests. That’s positive for the shares.”

Katmerciler trades at 13.5 times trailing 12-month earnings compared with a median of 16.2 times for 12 peers tracked by Bloomberg.

Demand for TOMAs, the Turkish acronym for “vehicles to intervene in social incidents,” increased as Turkish protests over redevelopment of an Istanbul park erupted into a nationwide movement following a police crackdown on the night of May 31.

‘Completely Transparent’

Katmerciler will sell 60 protest dispersion vehicles this year, up from 10 in 2012, Katmerci said. The company won the government’s May 16 tender in a “completely transparent” competition that included more than 40 rounds, he said.

The company’s bid of 10 million liras ($5.2 million) put the price per vehicle at about $171,000. That compares with 1 million euros ($1.33 million) for a “Water Cannon 10000” assembled by Rosenbauer using a chassis from Daimler AG, owner of the Mercedes Benz brand. The price is based on a press release from Stuttgart, Germany-based Daimler in November 2009 announcing a 10-year contract with the German federal police.

Katmerciler reported first-quarter net income of 2.1 million liras, down 28 percent from the same period a year earlier versus a profit of 29 million liras for Koc Holding’s Otokar. A planned sale of 3 million shares, or 12 percent of the company, registered by Ismail Katmerci in April, led to talks with a U.S. investment fund that were suspended because of a disagreement, his son said.

“We’re still hopeful,” he said.

Weakening Currency

Second-quarter results to be released Aug. 26 will be negatively affected by the depreciation of the lira, Katmerci said. Katmerciler had short-term foreign-currency debt of $14.5 million and 17 million euros at the end of 2012, company filings show.

The Turkish lira has weakened 8.2 percent this year against the dollar, the second-worst performance among currencies in major emerging markets in Europe, Middle East and Africa tracked by Bloomberg. The lira traded at 1.9433 per dollar today.

Established in 1985, Katmerciler entered the TOMA business three years ago. Its 350 employees operate as “tailors,” who convert trucks into custom utility vehicles, Katmerci said. At the plant in Izmir’s Cigli district, workers welded sheets of metal into shape to transform Mercedes and Iveco trucks into firetrucks, garbage trucks, street sweepers and TOMAs.

Katmerciler received a security certificate in March that allows the company to bid for defense contracts, including those from the North Atlantic Treaty Organization.

“That’s another catalyst,” said Seker’s Demirbilek, who has a 12-month price target of 7.3 liras, implying a 42 percent gain from today’s close.

Turkish public institutions accounted for 4.6 million liras of Katmerciler’s sales last year, less than 3 percent of the total, Katmerci said. About 90 percent of the vehicles produced are exported to 41 countries, according to the company’s 2012 annual report. Key markets include Iraq, Azerbaijan and Nigeria.

Syria, which accounted for about 20 percent of exports before the war, is no longer buying, Katmerci said. The company is in talks to supply Kamaz OJSC, the Russian truckmaker partly owned by Daimler, he said.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.