2Q25 Review-TURSG (Oyak Yatırım)

Combined ratio down; strong investment gains
Turkiye Sigorta posted 2Q25 net income of TL4,811mn (+6 q/q, +58% y/y), in line with our estimate (TL4,647mn); yet above market consensus (TL4,344mn). Technical line was supportive of results this quarter on the back of reversals from reserves and limited increase in claims. Combined ratio inched down to 93% in 2Q25 from 96% in 1Q and 102% a year ago. Financial income kept contributing to the results this quarter thanks to expanded portfolio size and agile portfolio reshuffle to high yielding instruments. Portfolio size reached to TL70bn, posting 56% y/y growth in 2Q25. Trailing ROE remained q/q flat at 51% in 2Q vs 58% a year ago. We expect 45% y/y higher earnings in 2025 with a ROE of 55%.
Investment portfolio keeps growing
Turkiye Sigorta has an investment portfolio of around TL70bn as of 2Q25 (24YE: TL53.7bn), in which time deposits, government and corporate bonds constitute a large part of the total portfolio. We expect its investment portfolio to reach TL90bn by 25YE, yielding a net investment return of c38%.
Attractive valuation; TP and OP rating maintained
Turkiye Sigorta trades at 26E P/BV of 1.7x and 4.0x P/E, while 26E ROE stands at 49%. We kept our 25E earnings estimate unchanged at TL18.5bn, while 26E earnings estimate indicate 20% y/y growth driven by potentially higher premium generation and better investment returns on growing AUM size. Reflecting all, we maintain our TP for TURSG at TL13.75, implying 50% upside potential. We also maintain our “Outperform” recommendation for the stock.


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