Otokar Climbs to Record on Saudi Interest Report: Istanbul MoverTaylan Bilgic
Otokar Otomotiv ve Savunma Sanayi AS, a Turkish producer of civilian and military vehicles, rose to a record after Hurriyet Daily News reported the company may sell tanks to Saudi Arabia.
The stock jumped 6.9 percent to 93.25 liras at the close in Istanbul, the highest level since the company started trading in April 1995. More than 229,000 shares changed hands, about 1.3 times the stock’s three-month daily average, according to data compiled by Bloomberg. The Borsa Istanbul National 100 index fell 0.4 percent to 91,016.31.
The company in which Koc Holding AS has a 44.7 percent stake may sell hundreds of Altay tanks to Saudi Arabia, Hurriyet reported today, citing unidentified defense officials. Turkey’s Undersecretariat of Defense signed an agreement to develop Altay five years ago. The company plans to start production in 2015, the state-run Anatolia news agency reported in November last year.
“Though 2015 is a long way down the road, investors are already pricing in expectations over Altay,” Serhat Kaya, an analyst at Oyak Securities in Istanbul, said in a phone interview today. “The reported interest from Saudi Arabia seems to have increased hopes further.”
The company’s press office in Istanbul declined to comment.
The second prototype of Altay was exhibited at the 11th International Defense Industry Fair from May 7 to May 10 in Istanbul. The development cost of the tank will be about $500 million, the company said on its website.
Otokar reported a non-consolidated profit of 25.3 million liras ($14 million) in the first quarter, compared with 6.33 million liras a year earlier, according to a company statement. Its shares have surged 120 percent this year, outperforming the 16 percent advance in the benchmark index. Two analysts recommended investors buy the shares, three said hold and one advised selling, according to data compiled by Bloomberg.