Mesut Ellialtioglu of Talas Turkey Value Fund presented his in-depth investment thesis on Soda Sanayii (Istanbul: SODA) at Wide-Moat Investing Summit 2018.

Thesis summary:

Soda Sanayii, established in 1969 as part of SiseCam Group’s chemical business segment in Turkey, is Europe’s 4th-largest and the world’s 10th-largest soda ash producer, with total production of 2.3 million tons in its Mersin, Turkey and Bosnia plants together with the production joint venture Solvay Sodi in Bulgaria. The company has soda ash market shares of 48% in Turkey and 15% in Europe. Additionally, producing chromium chemicals at Kromsan Chromium Compounds Plant in Turkey and Cromital in Italy, Soda Sanayii maintains a position as the industry leader in Europe, with 14% market share. The shares recently traded at 6.3x P/E, 4.1x EV/EBITDA, and a 5% dividend yield. Mesut expects growing consumption of chemical products from emerging markets should lead to sustainable mid-single digit earnings growth.

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About the instructor:

Mesut Ellialtioglu, the Fund’s Turkey Investment Officer, has 23 years of Turkey focused equity research and fund management experience and focuses on value investing opportunities in the Turkish equity market. Prior to forming Talas Capital with Mr. Matthew Peterson, Mr. Ellialtioglu worked with Bankers Trust Company as an associate, Korfez Securities (Garanti Bank) as Co-Head of Research, UB Ulusal Securities (formerly SAMBA Saudi American Bank) as Managing Director for research and asset management, Kent Securities as Head of Asset Management, and ABN AMRO Asset Management Turkey as Chief Investment Officer. Mr. Ellialtioglu graduated with BS in Economics degree from the Wharton School of Business of the University of Pennsylvania in 1993.