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Koc Holding A.S. Unsponsored ADR Class B (KHOLY)
OTHER OTC:KHOLY
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Koc Holding A.S. Unsponsored ADR Class B
(OTC:KHOLY)
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Rating:57Neutral
Price Target:
$22.00
▲(3.48% Upside)
Action:ReiteratedDate:02/18/26
The score is mainly held back by weakened financial quality—thin margins, higher leverage, and a 2025 swing to negative operating and free cash flow. Technicals are supportive with a clear uptrend, though momentum is overextended. Valuation is moderate with a helpful dividend, while the latest earnings call was net positive on profitability recovery and liquidity but acknowledged macro and segment headwinds.
Positive Factors
Consolidated profitability turnaround
A large, multi-year swing to positive consolidated net income strengthens internal capital generation capacity and reduces near-term reliance on external funding. Durable earnings recovery supports dividend capacity, selective M&A using the announced loan, and gives management room to execute restructuring or reinvestment plans over the next 2–6 months.
Automotive market position and exports
High domestic share and rising export penetration underpin durable cash flows and scale advantages in manufacturing and sourcing. Strong export growth diversifies demand away from Turkey, improving hard-currency receipts and making the automotive segment a stable earnings engine that can fund group investment and offset domestic cyclicality over coming quarters.
Holding liquidity and FX exposure
Material holding-level liquidity plus a committed $600m facility provides a durable buffer against funding shocks and supports selective M&A. High hard-currency cash and significant hard-currency revenue reduce FX mismatch, improving the group's ability to service foreign‑currency obligations and stabilize operations through currency volatility.
Negative Factors
Elevated leverage
A materially higher debt-to-equity ratio constrains strategic flexibility and amplifies funding risk if cash flows weaken. Higher leverage increases interest and refinancing sensitivity in a higher-rate environment, reducing the group's capacity to pursue growth or absorb shocks across subsidiaries over the next several quarters.
Weak cash generation (2025)
The shift to negative operating and free cash flow materially raises funding risk and forces greater reliance on liquidity lines or asset sales. Volatile cash conversion impairs the group's ability to deleverage, sustain capex or dividends, and increases the chance management must reallocate capital or delay investments in a multi‑quarter horizon.
Margin deterioration and thin profitability
Sustained compression of EBIT and net margins reduces shock absorption and lowers cash available for debt service and reinvestment. Structural margin pressure from competition, cost inflation, and adverse mix makes earnings more cyclical and increases the likelihood that earnings volatility will persist over the next several quarters.
Koc Holding A.S. Unsponsored ADR Class B (KHOLY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.85B
Dividend Yield4.41%
Average Volume (3M)32.00
Price to Earnings (P/E)18.1
Beta (1Y)0.05
Revenue Growth-6.21%
EPS Growth-89.39%
CountryUS
Employees130,760
SectorIndustrials
Sector Strength72
IndustryConglomerates
Share Statistics
EPS (TTM)0.99
Shares Outstanding371,424,930
10 Day Avg. Volume96
30 Day Avg. Volume32
Financial Highlights & Ratios
PEG Ratio0.01
Price to Book (P/B)0.64
Price to Sales (P/S)0.14
P/FCF Ratio-2.02
Enterprise Value/Market Cap107.82
Enterprise Value/Revenue0.44
Enterprise Value/Gross Profit2.60
Enterprise Value/Ebitda5.90
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)2.33
Revenue Forecast (FY)$82.31B
Koc Holding A.S. Unsponsored ADR Class B Business Overview & Revenue Model
Company DescriptionKoç Holding A.S., through its subsidiaries, engages in the energy, automotive, consumer durables, finance, and other businesses in Turkey and internationally. The company's energy business operates petroleum refineries; distributes petroleum products and liquefied petroleum gases; and generates electricity through hydroelectric, natural gas, coal, thermal, and solar power and other renewable plants. It serves customers under the Akpa, Aygaz, Lipetgaz, Mogaz, Pursu, Aygaz Dogalaz, Demir Export, Ditas, Opet Fuchs, Opet, THY Opet, Tupras, Elektra Bregenz, and Entek brand names. The company's automotive business provides light commercial vehicles, passenger cars, tractors, buses, and trucks, as well as offers automotive retailing and car rental services. It serves customers under the Ford, Koç Fiat Kredi, Otokar, Avis, Birmot, Budget, Otokoç, Otokoç Otomotiv, Otokoç Sigorta, Alfa Romeo, Ferrari, Fiat, Lancia, Maserati, Otoeksper, Tofas, Case IH, and TürkTraktör. The company's consumer durables business offers white goods, televisions, and air conditioners under the Arçelik, Beko, Leisure, Arctic, Altus, Grundig, Blomberg, Defy, Elektra Bregenz, Flavel, Arçelik LG, TEE, and WAT brand names. Its finance business provides various banking and financial products and services that include private banking, factoring, leasing, portfolio management, and credit cards under the Koçfinans, Yapi Kredi Bankasi, Token, akpakoc, Yapi Kredi Faktoring, Yapi Kredi, Yapi Kredi Leasing, Yapi Kredi Kültür Sanat Yayincilik, Yapi Kredi Portföy Yönetimi, Yapi Kredi Yatirim, and Yapi Kredi Koray brand names. The company's other business offers tomato products and pastes, canned pickles, and ketchups; and pasteurized milk, as well as do it yourself retailing, marina, tourism, and information technology services under various brand names. The company was founded in 1926 and is based in Istanbul, Turkey.
How the Company Makes MoneyKoç Holding makes money primarily through (1) earnings generated by its consolidated subsidiaries and (2) income from its equity-accounted investments (associates and joint ventures). For consolidated businesses, the group records revenue from the sale of goods and services across its operating segments, and profitability depends on volumes, pricing, input costs, and operating efficiency in each sector. Key operating cash flows typically come from: energy activities (sales of refined petroleum products and fuels through refining and distribution operations), automotive activities (sales of vehicles and automotive-related products through manufacturing/assembly and distribution networks), consumer durables (sales of appliances and electronics), and financial services (interest income, fees/commissions, trading/market income, and insurance premiums earned by affiliated financial institutions where applicable). At the holding-company level, Koç Holding also generates shareholder returns via dividends received from portfolio companies (subject to those companies’ profitability and payout policies) and may realize gains or losses from changes in ownership interests or portfolio transactions. A significant contributor to earnings is the performance of major affiliates and joint ventures; however, specific partner names, contract terms, or segment-by-segment revenue shares are not provided here because they are not included in the prompt and cannot be reliably inferred without source documents.
Koc Holding A.S. Unsponsored ADR Class B Earnings Call Summary
Earnings Call Date:Feb 11, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call presents a broadly positive operational and financial recovery: a pronounced turnaround in consolidated net income (TRY 22.0 billion), higher operating profit (+9%), strong performance in automotive and energy and marked improvement at the bank underpin the group’s resilience. These positives are tempered by persistent macro challenges (elevated inflation and higher interest rates), softer demand in consumer durables and tractors, a wide NAV discount versus historical norms, and some asset‑specific underperformance. On balance the material earnings and cash‑flow improvements and strengthened liquidity position outweigh the noted sectoral headwinds.Q4-2025 Updates
Positive Updates
Strong Consolidated Profitability Turnaround
Consolidated net income rose to TRY 22.0 billion in 2025 from TRY 1.7 billion in 2024 (approximately +1194% YoY), reflecting a material recovery at the bottom line driven by improved operating profit and lower net monetary losses.
Operating Profit Growth
Combined operating profit increased by ~9% year‑on‑year to TRY 155.5 billion in 2025.
Quarterly Turnaround
Fourth-quarter consolidated net income was TRY 7.0 billion versus a TRY 8.0 billion loss in the same period last year, marking a strong sequential and year‑over‑year improvement.
Robust Automotive Performance and Market Share Gains
Automotive remained the largest contributor with TRY 17.7 billion; group domestic market share ~30%; domestic market grew 11% to a record 1.4 million units; export market share increased to ~43% (around +6 percentage points). Ford Otosan export volume +10% YoY; Tofas export volume +41% YoY and completed acquisition of Stellantis Turkey.
Energy Segment Strength
Energy contribution to consolidated net income was about TRY 13–13.4 billion in 2025 (up from TRY 9.2 billion prior year, ~+41% YoY). Tupras operated at ~94% utilization, sold 29.4 million tonnes, and beat net refinery margin guidance; gasoline demand +16% and jet fuel +15% (11 months data).
Improving Financial Services Performance (Yapi Kredi)
Finance segment contribution narrowed to a negative TRY 0.6 billion in 2025 from negative TRY 20.5 billion in 2024. Yapi Kredi delivering: performing cash loan growth ~45% YoY, customer deposits +44% YoY, swap‑adjusted NIM expanded +151 bps to 2.24%, net fee & commission income +50% YoY, RoE 21.4%, RoA 1.5%, consolidated CAR 14.8% and Tier‑1 11.8%.
Improved Cash Generation at Consumer Durables (Arcelik)
Arcelik generated EUR 5.7 billion free cash flow in 2025 reversing last year's negative FCF; delivered improvements in gross margin and EBITDA margin despite revenue declines.
Liquidity and FX Profile
Holding-level net cash of $815 million at year-end, with ~69% of that in hard currency; net cash level at holding TRY 34.9 billion after dividend inflows (~TRY 33.4 billion). Secured a 5‑year club loan of $600 million (funding available) to strengthen liquidity. Group current ratio 1.2x and net financial debt / EBITDA (ex-finance) 1.2x.
International and Hard‑Currency Revenue Exposure
31% of combined revenues from international sales in 2025; including Tupras, roughly 46% of revenues are hard‑currency linked, providing natural FX hedging for the group.
Unlisted Asset Developments
Ongoing growth/strategic moves in unlisted assets: Otokoc expansion (operations in 9 countries), Entek renewable growth (77% carbon zero of 492 MW), construction of 178.5 MW solar in Romania, Koc Finansman loan portfolio +79% and net profit +52% to TRY 1.5 billion, marina acquisitions expanding market share to ~24%.
Negative Updates
High Inflation and Macroeconomic Uncertainty
Turkey annual inflation remained elevated at 30.9% in 2025 (down from 44.4% in 2024) and market interest rates were higher than anticipated, creating a volatile operating environment and weighing on consumer demand and costs.
Consumer Durables Revenue Declines
Arcelik revenues declined by 6.6% YoY in Turkey and also -6.6% internationally; white goods unit sales in Turkey contracted ~3% and exports declined ~10% YoY, reflecting weak external demand and intensified competition.
Material Weakness in Agricultural/Tractor Business
TurkTraktor revenues dropped ~39% YoY, driven by a 41% contraction in tractor sales volume; domestic tractor market contracted ~36% in 2025 due to adverse climate and tight liquidity.
Pressure on Automotive Profitability
Despite volume growth, automotive segment profitability was slightly lower than prior year due to intense competitive pricing, adverse sales mix and higher cost of goods sold amid inflationary pressures.
LPG Demand and Aygaz Pressures
Domestic LPG consumption fell ~5% YoY in certain months; while Aygaz reported stable domestic retail volumes, total sales volume grew only ~1% in 2025, indicating soft market conditions.
NAV Discount and Market Sentiment Mismatch
Weekly average NAV discount widened to ~34% in 2025, noticeably wider than the long‑term average of ~14%, suggesting the market valuation of the holding is materially below underlying fundamentals.
Holding Cash Shortfall vs Earlier Projection and Q4 Outflows
Solo holding net cash ended at $815 million (below an earlier projection of roughly $1.2 billion); management cited Q4 year‑end bonuses, smaller capital increases and marina payments as reasons for ~360 million USD outflow in Q4.
Finance Segment Still Negative on Consolidated Basis
Although significantly improved, the finance segment remained a slight drag on consolidated net income (negative ~TRY 0.6 billion) due to inflation-adjusted consolidation effects and remaining monetary losses.
Company Guidance
Koc guided a conservative, acquisition‑ready stance: management plans to draw down a 5‑year $600m club loan before the April deadline and hold it as a war‑chest for selective M&A while preserving liquidity (holding solo net cash $815m, 69% in hard currency; year‑end net cash TRY34.9bn). On group targets and positioning they highlighted resilient results and normalization plans — group revenues TRY4.6tn, operating profit TRY155.5bn (≈+9% y/y), profit before tax TRY124.5bn and consolidated net income TRY22bn (Q4: TRY7bn vs -TRY8bn prior year) — with conservative balance‑sheet metrics (combined current ratio 1.2x; net financial debt/EBITDA ex‑finance 1.2x) and a belief NAV discount (weekly avg 34% vs long‑term ~14%) understates fundamentals. Segment‑level forward signals included Ford Otosan capex set to normalize, Tofas expecting accelerated volumes in 2026 under the amended K0 contract, TurkTraktor aiming to strengthen share in a flat tractor market, and Otokar scaling Mercedes‑Benz Conecto city‑bus production in 2026; the finance arm (Yapi Kredi) flagged continued momentum with performing cash loan growth +45%, deposits +44%, swap‑adjusted NIM 2.24%, ROE 21.4% and CAR 14.8%.Koc Holding A.S. Unsponsored ADR Class B Financial Statement Overview
Summary
Strong multi-year revenue expansion, but profitability has weakened sharply with much lower margins versus prior peaks. Leverage is elevated and worsening (debt-to-equity ~2.23x), and cash generation is the main concern with 2025 turning to negative operating cash flow and deeply negative free cash flow, increasing funding risk.Income Statement
Revenue has scaled sharply over the last several years (2025 revenue up ~20% YoY after large step-ups in prior years), showing strong top-line momentum. However, profitability has deteriorated meaningfully: net margin fell from ~13.1% (2022) and ~4.5% (2023) to near breakeven in 2024 (~0.06%) and remained very thin in 2025 (~0.8%). Operating profitability is also well below prior peaks (EBIT margin ~3.8% in 2025 vs. ~17.3% in 2023), indicating weaker cost/price mix and/or heavier operating burden despite continued growth.56
Neutral
Balance Sheet
The balance sheet has expanded materially (assets rising from ~1.58T in 2022 to ~5.31T in 2025), but leverage is elevated and trending worse recently. Debt-to-equity sits at ~2.23x in 2025 (up from ~1.66x in 2023–2024), which limits flexibility if earnings or cash flows stay pressured. Equity has grown alongside assets, but returns on equity have fallen dramatically from very strong levels in 2022–2023 to very low levels in 2024, highlighting that recent growth has not translated into shareholder returns.49
Neutral
Cash Flow
Cash generation is the key weak spot. Operating cash flow turned negative in 2025 (-101.3B) after being positive in 2024–2023, and free cash flow was deeply negative in 2025 (-213.0B). While free cash flow was strong in 2023 (270.7B) and positive in 2024 (18.4B), the 2025 reversal suggests higher working-capital needs and/or heavier spending. Overall, cash conversion has become volatile, increasing reliance on funding and adding risk alongside the higher leverage.32
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.99T | 2.32T | 1.60T | 901.86B | 346.69B |
| Gross Profit | 470.65B | 327.83B | 376.65B | 226.84B | 80.06B |
| EBITDA | 193.16B | 143.77B | 309.02B | 142.16B | 35.24B |
| Net Income | 23.88B | 1.31B | 72.23B | 118.22B | 26.18B |
Balance Sheet | |||||
| Total Assets | 5.31T | 3.91T | 2.86T | 1.58T | 1.02T |
| Cash, Cash Equivalents and Short-Term Investments | 907.07B | 575.01B | 486.29B | 306.72B | 207.25B |
| Total Debt | 1.51T | 879.32B | 670.38B | 378.55B | 286.29B |
| Total Liabilities | 4.22T | 3.05T | 2.18T | 1.34T | 899.45B |
| Stockholders Equity | 677.00B | 528.63B | 404.73B | 149.35B | 63.64B |
Cash Flow | |||||
| Free Cash Flow | -212.96B | 18.38B | 270.74B | 87.88B | 38.14B |
| Operating Cash Flow | -101.29B | 116.31B | 339.02B | 115.48B | 50.66B |
| Investing Cash Flow | -354.99B | -121.37B | -165.46B | -86.42B | -53.60B |
| Financing Cash Flow | 316.90B | 9.60B | -17.42B | -5.56B | 10.20B |
Koc Holding A.S. Unsponsored ADR Class B Technical Analysis
Positive
21.26
Price Trends
22.88
Negative
21.46
Positive
20.99
Positive
Market Momentum
-0.39
Positive
44.56
Neutral
77.78
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KHOLY, the sentiment is Positive. The current price of 21.26 is below the 20-day moving average (MA) of 22.67, below the 50-day MA of 22.88, and above the 200-day MA of 20.99, indicating a neutral trend. The MACD of -0.39 indicates Positive momentum. The RSI at 44.56 is Neutral, neither overbought nor oversold. The STOCH value of 77.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KHOLY.
Koc Holding A.S. Unsponsored ADR Class B Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $7.99B | 23.29 | 20.28% | 0.63% | 1.23% | -22.77% | |
72 Outperform | $4.75B | 8.64 | 10.05% | 0.21% | 10.31% | ― | |
69 Neutral | $146.15B | 24.26 | 31.25% | 2.24% | 7.48% | 9.55% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
57 Neutral | $10.85B | 18.06 | 3.47% | 4.41% | -6.21% | -89.39% | |
55 Neutral | $76.41B | 26.32 | 71.89% | 1.82% | -13.09% | -20.63% | |
49 Neutral | $4.87B | -14.82 | -10.91% | 27.59% | -8.45% | 27.66% |
* Industrials Sector Average
KHOLY
Koc Holding A.S. Unsponsored ADR Class B
21.45
0.26
1.23%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.