Mesut Ellialtioglu of Talas Turkey Value Fund presented his investment thesis on Brisa Bridgestone Sabanci Lastik San. (Turkey: BRISA) at Best Ideas 2023.

Thesis summary:

Brisa is a leading tyre manufacturer in Turkey and the EMEA region. It has a market capitalization of US$930 million. The company is a JV between Bridgestone Corp. of Japan and Sabanci Holding AS of Turkey.

Brisa completed investments in its second greenfield production plant with a US$300 million capex investment in 2018. Brisa, operating as a single entity with its two major manufacturing plants in Turkey, is improving its financial performance in 2023 and beyond. Brisa is also investing in providing mobility solutions such as fleet management, e-charge stations, and tire end-to-end services (e-commerce). Mesut expects Brisa to deliver strong earnings, cash generation, and improvement in the dividend payment outlook.

The company is valued at EV/EBITDA multiple of 5.5x applied to average 2021-22 EBITDA. Mesut’s target price offers 65% upside from the recent price level over the next twelve months.

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About the instructor:

Mesut Ellialtioglu, the Fund’s Turkey Investment Officer, has more than two decades 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 Matthew Peterson, Mesut 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.

Mesut graduated with BS in Economics degree from the Wharton School of Business of the University of Pennsylvania in 1993.

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