Thanks for the article! Kaspi is a large chunk of my portfolio too. What bothers me is that Baring (PE fund who has owned it for years) has been selling, according to public disclosures. Do you have a view on this?
Great question. My view is that usually insider buying is a stronger signal than insider selling. Because selling could be from multiple reasons outside of their pov on business (returning cash to partners, other portfolio changes, strategy changes etc.). For eg one of the companies I own is Cogent where the CEO has been aggressively selling in market. But that’s because he has a personal PF where he is leveraged on commercial real estate. Things like this happen so I would definitely put insider selling as a weaker signal.
My understanding was that a big part of the appeal of NASDAQ listing might have been exit liquidity for Baring. I'm currently researching Kaspi myself, but thats one of the questions I usually ask for recent IPOs. And if you wanna come on the podcast to talk Kaspi i'd love to have you
I agree re signal strength of insider selling. Would still prefer not to see them selling though. Michael Calvey (Baring) is a brilliant investor. I hope this is due to better opportunities elsewhere or the need to return cash to LPs rather than pessimism towards Kaspi’s future.
To be honest at these levels management needs to announce share buybacks in the next earnings or latest for FY2025 earnings. It is really a shame that they didn't keep any of it alive, at these levels it seems too cheap to be true, even at no growth it represents a double digit return over the next years.
100% agreed. There is tremendous upside if they can get a superapp in Turkey and turn hepsiburada around too. In near term I don’t know what will happen but definitely over next few years the price should move up.
To be honest I don’t think it will take too long. They will at latest in the FY2025 earnings announcement state that they are going to put a considerable amount of Cashflow towards share repurchases or dividends, which should already give the shares a good catalyst. I’m interested to see how their Q3 results look, especially on the margin front. Currently heavily betting on the company (16% of my portfolio).
Agreed. This would be the right time to do it. My bigger concern is the execution risk with their recent acquisition and if they would pump more captial to turn it around. If not, the stock should re rate eventually
I see what you mean, but I don’t believe from the way they sounded at Q2 earnings that they will blindly pour money into Hepsi, without looking at shareholder interests. The note from them in finding a balance of growth investments and shareholder returns was very important in my eyes.
Its quite a large part of my portfolio as well around 20%. Trying hard to not go higher than this to diversify but my conviction is stronger as price keeps dropping. Copying below what I posted in another sub.
"One thing that stands out to me is the float is so low compared to the outstanding shares. Other sites has it all over the place but if you look at the Q2 2025 financial statement public float is only 28% of the 190m shares. Rest is restricted ownership of CEO (22%), Chairman (21%) and Baring Funds(25%) which I guess is private equity investments. 190M * 28% - 53M available public float. If that's true and they do buybacks next year like they mentioned in the Q2 call if share prices remain at what it was ($77 at that time) @ 60% payout of $2B of net income per year they could buy back 30% of the float in one year.
Also to add some fuel to that I am not sure how much of the public float is institutional ownership via funds, etfs, etc that typically are passive and keep shares no matter how high the price gets. If KSPI starts buying back the float this thing could jump quite a bit or am I missing something? Anyone know how to get the institutional ownership info of the public float for KSPI?"
Thanks for the article! Kaspi is a large chunk of my portfolio too. What bothers me is that Baring (PE fund who has owned it for years) has been selling, according to public disclosures. Do you have a view on this?
Great question. My view is that usually insider buying is a stronger signal than insider selling. Because selling could be from multiple reasons outside of their pov on business (returning cash to partners, other portfolio changes, strategy changes etc.). For eg one of the companies I own is Cogent where the CEO has been aggressively selling in market. But that’s because he has a personal PF where he is leveraged on commercial real estate. Things like this happen so I would definitely put insider selling as a weaker signal.
My understanding was that a big part of the appeal of NASDAQ listing might have been exit liquidity for Baring. I'm currently researching Kaspi myself, but thats one of the questions I usually ask for recent IPOs. And if you wanna come on the podcast to talk Kaspi i'd love to have you
I would love to. Let me DM you!
I agree re signal strength of insider selling. Would still prefer not to see them selling though. Michael Calvey (Baring) is a brilliant investor. I hope this is due to better opportunities elsewhere or the need to return cash to LPs rather than pessimism towards Kaspi’s future.
Agreed. IMO real make or break is what the mgmt will do in Turkey.
To be honest at these levels management needs to announce share buybacks in the next earnings or latest for FY2025 earnings. It is really a shame that they didn't keep any of it alive, at these levels it seems too cheap to be true, even at no growth it represents a double digit return over the next years.
100% agreed. There is tremendous upside if they can get a superapp in Turkey and turn hepsiburada around too. In near term I don’t know what will happen but definitely over next few years the price should move up.
To be honest I don’t think it will take too long. They will at latest in the FY2025 earnings announcement state that they are going to put a considerable amount of Cashflow towards share repurchases or dividends, which should already give the shares a good catalyst. I’m interested to see how their Q3 results look, especially on the margin front. Currently heavily betting on the company (16% of my portfolio).
Agreed. This would be the right time to do it. My bigger concern is the execution risk with their recent acquisition and if they would pump more captial to turn it around. If not, the stock should re rate eventually
I see what you mean, but I don’t believe from the way they sounded at Q2 earnings that they will blindly pour money into Hepsi, without looking at shareholder interests. The note from them in finding a balance of growth investments and shareholder returns was very important in my eyes.
True. I liked the CEO clarifying he is biggest shareholder in the company! The perception should turn around over time.
Its quite a large part of my portfolio as well around 20%. Trying hard to not go higher than this to diversify but my conviction is stronger as price keeps dropping. Copying below what I posted in another sub.
"One thing that stands out to me is the float is so low compared to the outstanding shares. Other sites has it all over the place but if you look at the Q2 2025 financial statement public float is only 28% of the 190m shares. Rest is restricted ownership of CEO (22%), Chairman (21%) and Baring Funds(25%) which I guess is private equity investments. 190M * 28% - 53M available public float. If that's true and they do buybacks next year like they mentioned in the Q2 call if share prices remain at what it was ($77 at that time) @ 60% payout of $2B of net income per year they could buy back 30% of the float in one year.
Also to add some fuel to that I am not sure how much of the public float is institutional ownership via funds, etfs, etc that typically are passive and keep shares no matter how high the price gets. If KSPI starts buying back the float this thing could jump quite a bit or am I missing something? Anyone know how to get the institutional ownership info of the public float for KSPI?"
Agreed. The illiquidity definitely can be a huge driver like an embedded leverage into the stock