18 February 2005 -

Report Summary

Established in 1954, Turk Demir Döküm (TUDDF) is a small cap that offers value, with 47% upside potential according to our fair value estimate. The Company manufactures radiators, heaters and other heating equipment at its two plants in İnegöl and Bozüyük. The Company is Turkey’s leading iron and steel castings manufacturer. Demir Döküm’s vast product portfolio includes panel radiators, gray iron radiators, cast iron boiler sections, central heating systems and equipment, combis, household heating equipment, air conditioners, heaters, stoves and parts, small kitchen appliances and more. We expect revenues to attain a CAGR of 10% over the next five years, mainly as a result of rising natural gas consumption Natural gas consumption aside, stronger expectations in 2005 for the construction and housing industry will have a positive effect on Demir Döküm’s sales Around 30% of the Company’s total revenue derives from export sales. Demir Döküm aims to increase this figure to 40% in the medium term. We value the Company at US$ 275 mn with a "BUY" recommendation.

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