Fitch upgrades Turkcell

Fitch Ratings said it upgraded Turkey-based Turkcell AS's local-currency issuer default rating to BB+ from BB and affirmed the BB- foreign-currency issuer default rating. The outlook is positive.

The upgrade reflects the solid performance of Turkcell's Turkish mobile operations on the back of its leading market position despite rising competition, the agency said. Positive macroeconomic trends and a stronger Turkish lira also contributed to the good performance.

Fitch said the ratings are supported by the company's impressive operating performance in 2005 and the first quarter of 2006, good long-term growth prospects in the domestic market, its strong cash generation capability and favorable credit profile compared to its European peers.

Turkcell faces potential regulatory and competitive challenges, however, such as the passage of the Electronic Communications Draft law that will grant more power to the Telecommunications Authority, the agency said.

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