Borsa Istanbul’s IPO price ceiling spell broken

Borsa Istanbul’s IPO price ceiling spell broken
By Akin Nazli in Belgrade May 5, 2021

The prices of shares featuring in Borsa Istanbul initial public offerings (IPOs) have since last year become locked at their price ceiling for many days. Lately, the price ceiling spell has been broken, but the IPO pipeline is still producing new offerings.

(See table at the bottom of the page for full list of held and upcoming IPOs).

Tureks Turizm (TUREX) was responsible for breaking the spell. The share price of Tureks has drawn a pyramid with a lower right-hand tail.

On April 15, the sixth post-IPO trading day, a would-be career high-flyer (belowsold a heavy stake in Tureks on a short. He and his brokerage house explained that the move was an error.

To correct this apparent mistake, the trader replaced his missing shares by buying back in on the trading board. But he had to buy back at lower prices than he sold for in the short.

For three months, he will, at the regulator’s direction, not be able to sell shares short, trade on credit or convey transaction orders via the internet. It seems that these punishments are seen as sufficient. The Capital Markets Board (SPK) has not announced any further action.

Selling a stock short on the Borsa Istanbul if the stock is not a BIST-50 index component is actually forbidden.

On April 15-16, Istanbul-listed Dogan Holding (DOHOL) raised Turkish lira (TRY) 812mn by selling a 30% stake in Galata Wind (GWIND) in an IPO.

The IPO price was TRY5.06 per share.

As of May 4, Galata Wind shares were trading at TRY4.99.

On April 26, Murat Dogu, deputy head of financial affairs at Dogan Holding, said in a stock exchange filing that he sold 94,481 Galata Wind shares in a price range of TRY5.75-5.80.

On April 27, Dogan Holding CEO Caglar Gogus said in a separate filing that he bought 99,830 Galata Wind shares at TRY5.36 per share.

On April 28, Dogan Holding said in a stock exchange filing that it would buy back a Galata Wind stake of up to 1.5% at prices below the IPO price for a total consideration of up to TRY41mn.

Since then, Dogan has been buying back shares, which it sold for TRY5.06 in the IPO, at lower prices.

On May 3, business daily Dunya blamed the last four energy company IPOs, namely those of Galata Wind, Aydem Enerji, Biotrend and Can 2, for breaking the post-IPO “ceiling-upon-ceiling” cycle.

This happened because these IPOs were bigger than the previous ones.

The record for getting locked at the price ceiling following the opening of market trading belongs to Turk Ilac (TRILC).

The IPO price for Turk Ilac shares stood at TRY10. The shares are currently traded in the TRY39s after seeing TRY73.6 on the 20th trading day.

In the biggest IPO so far, government-run Ziraat REIT (real estate investment trust) raised TRY1.88bn from the sale of a 25% stake.

So far in 2021, 11 companies have raised a total of TRY6.6bn in IPOs (chart below by daily Sozcu).

On April 21, Dunya reported that to date this year 19 companies have raised an overall TRY4bn via rights issues on the Borsa Istanbul.

Ihlas Holding (IHLAS) raised TRY613mn, Cemas Dokum (CEMAS) TRY311mn and Izmir Demir Celik (IZMDC) TRY188mn.

In 2020, around 40 companies held rights issues on the stock exchange, BloombergHT reported.

Major IPOs in Turkey
Date Sold Stake Price Buyer Seller
May-21 Kayseri Seker 15% TRY106mn IPO Kayseri Sugar Beet Association
May-21 Kalekim 26% TRY474-509mn IPO owners
May-21 Penta Teknoloji 48.34% TRY375-445mn IPO Gozde(GOZDE)(Yildiz Holding)
May-21 Gelecek Varlik 32% application IPO Fiba Holding
Apr-21 ATP Ticari SPK application IPO owners
Apr-21 Ziraat REIT 25% TRY1.88bn IPO Ziraat Bank
Apr-21 Baskent Dogalgaz SPK application IPO Torunlar
Apr-21 Escar 20% application IPO -
Apr-21 330MW Can2 coal 23.2% TRY290mn IPO Odas (ODAS)
Apr-21 Seker REIT SPK application IPO owners
Apr-21 Manas Enerji SPK application IPO owners
Apr-21 Mercan Kimya SPK application IPO owners
Apr-21 Bogazici Beton SPK application IPO owners
Apr-21 PC Iletisim SPK application IPO owners
Apr-21 Oyak Invest SPK application IPO owners
Apr-21 Ulusal Faktoring SPK application IPO owners
Apr-21 Unlu & Co SPK application IPO owners
Apr-21 Isbir Sentetik 30-35% application IPO owners
Apr-21 Ihlas Haber Ajansi SPK application IPO owners
Apr-21 Aydem Enerji (Bereket) 18.44% TRY1.3bn IPO Aydem(Bereket/Saldanli)
Apr-21 Biotrend Cevre 27.8% TRY750mn IPO owners
Apr-21 Galata Wind 30% TRY812mn IPO Dogan (DOHOL)
Apr-21 Suwen 46.26% application IPO owners
Apr-21 Selva Gida SPK application IPO Ittifak (ITTFH)
Apr-21 Qua Granite (QUAGR) 20% TRY395mn IPO owners
Apr-21 Tarkim brokerage mandate IPO Gubretas (GUBRF)
Apr-21 Tureks (TUREX) 20.82% TRY270mn IPO Owners
Mar-21 Matriks (MTRKS) 38.05% TRY208mn IPO Owners
Mar-21 Naturelgaz (NTGAZ)     IPO Owners
Feb-21 Turk Ilac (TRILC) 30.43% TRY235mn IPO Owners
Jan-21 Isik Plastik 21.8% TRY182mn IPO @Borsa Istanbul
Feb-18 Medical Park (MPARK) 36.15% TRY1.38bn IPO Turkven etc.
Jun-17 Mavi Jean (MAVI) 55% TRY1.17bn IPO Turkven etc.