Financial Analysis of the IT Sector
Chapter from the book: Kılıç, Y. & Buğan, M. F. & Bayrakdaroğlu, A. (eds.) 2023. Financial Analysis Applications in Borsa Istanbul: Sector-Based Reviews II.

Kemal Taysı
Kırklareli University

Synopsis

The IT sector is a sector that covers all activities related to the processing, storage and transmission of information, and with the spread of globalization, digitalization and the internet, it has become very important for individuals and societies by spreading to every aspect of life, from production to consumption, from logistics to communication, from the defense industry to socialization. Due to the increase in demand for IT products and services by both individuals, states and companies, the IT sector is among the fastest growing and developing sectors in our country and in the world. The purpose of the study is to make a financial analysis of the Borsa Istanbul Technology Index IT Sector. For this purpose, the financial statements of the companies operating in the sector for the years 2018-2022 were accessed from the Public Disclosure Platform, sector financial ratios were calculated and the findings were interpreted. In the ratio analysis, the liquidity ratios of the sector are significantly above the standard values and there is no cash shortage, the debt and equity distribution of the sector companies are at an ideal level in terms of financial structure ratios, and when the turnover rates are examined, it is seen that the five-year average cash conversion period of the sector is 85 days, and this period is long. It has been determined that the most important reason for this is due to the receivables collection period with an average of 118 days, the sales efficiency of the sector is not at the desired level with an average asset turnover rate of 1.41, and as another indicator of this situation, the average operating profitability of the sector is at the level of 15%. In addition, during the Covid-19 pandemic period of 2019-2020, remote working and distance education became a necessity at some point and the increase in demand for IT products and services directed the attention of investors to this sector, and subsequently due to the dramatic increase in sector stock prices - especially in 2020. The sector Price Earnings (PR) ratio (32.05) has reached a level three times the BIST 100 average (~10).

How to cite this book

Taysı, K. (2023). Financial Analysis of the IT Sector. In: Kılıç, Y. & Buğan, M. F. & Bayrakdaroğlu, A. (eds.), Financial Analysis Applications in Borsa Istanbul: Sector-Based Reviews II. Özgür Publications. DOI: https://doi.org/10.58830/ozgur.pub255.c1155

License

Published

October 15, 2023

DOI