Mobius talks Turkey: Best bet in emerging Europe

Templeton Asset Management Ltd. plans to invest $250 million in Turkish equities very soon, as the country’s stocks are by far the most attractive among emerging European countries, Mark Mobius said.

“Just this month we will be putting another $250 million in,” Mobius, who oversees about $34 billion, including $1 billion invested in Turkey, as the Singapore-based chairman of Templeton’s emerging markets group, said at a press conference in Istanbul late yesterday. “Our funds are very overweight in Turkey.”

Turkey’s ISE National 100 Index has risen 24 percent this year, the most among major European gauges, and added 0.4 percent to 65,795.18 at 11:25 a.m. today in Istanbul, headed toward a record close. The index is poised for a 20 percent advance this quarter, its biggest quarterly gain in a year. The benchmark’s valuation of 11.6 times reported earnings is the highest since March, and below the 14.8 for the benchmark MSCI Emerging Markets Index, according to data compiled by Bloomberg.

The best opportunities are in banking, oil and consumer shares, Mobius said in an interview with Bloomberg HT television late yesterday.

“In our East European fund, Turkey is the highest allocation, above Russia,” he said. “Turkey is in better shape than its neighbors in Europe, where they have very high unemployment.”

‘Very Good Year’

Turkey survived the global crisis without bailing out any banks, and this year Prime Minister Recep Tayyip Erdogan ended loan talks with the International Monetary Fund, saying the country can meet its borrowing needs without external assistance. Turkey’s economy grew at an annual rate of more than 10 percent in the first two quarters, outpacing all other members of the Group of 20 major economies except for China.

“The market is technically telling us that next year is going to be a very good year for Turkey because of these increased earnings,” Mobius said. “There is no political risk we can see for Turkey.”