D-MARKET Electronic Services & Trading (Hepsiburada) Annual Report - How They Did This Year

I’m putting together a guide to help you make sense of D-MARKET’s (Hepsiburada) latest annual report. Think of this as a plain-English breakdown of how the business is doing and what you should watch before investing.

1. What does this company do?

Hepsiburada is the "Amazon of Turkey." They run a massive online marketplace connecting merchants with shoppers and sell their own inventory directly. They also operate a full ecosystem:

• HepsiLojistik: Their own delivery and warehouse network.
• Hepsipay: A digital wallet for payments and "Buy Now, Pay Later" services.
• Hepsiburada Premium: A subscription program that offers free shipping to keep customers coming back.

They trade on the Nasdaq under the symbol HEPS.

2. Understanding the "Hyperinflation" Factor

Because Hepsiburada operates in Turkey, they follow specific accounting rules for high-inflation economies. They restate their financial results to show the purchasing power of the Turkish Lira at the end of the year. This means they use "inflation-adjusted" figures rather than raw historical numbers. This approach provides a clearer picture of actual growth by accounting for the changing value of the currency.

3. How they measure success

The company tracks several metrics to gauge growth:

• GMV (Total Sales Value): The total value of all goods sold on the platform, including taxes and shipping. This measures the scale of their business.
• Active Customers: The number of unique people who made at least one purchase in the last year.
• Order Frequency: How often the average customer shops, which serves as a key indicator of customer loyalty.
• The "Kaspi" Shift: Following the acquisition of a majority stake by Kaspi.kz, the company is shifting toward a "super-app" model. They are prioritizing high-profit fintech services, like digital payments and loans, to complement their retail business.

4. Major wins and challenges

The company is focused on building a digital ecosystem. By owning their delivery and payment systems, they aim to "lock" customers into their platform, encouraging them to use multiple services. While this strategy is designed to drive long-term sales, it requires significant investment in logistics and retail operations, which can be costly to maintain during periods of high inflation.

5. Key risks to watch

• Currency Swings: The Turkish Lira is volatile against the U.S. Dollar. Since the company reports in Lira but trades in Dollars, a weak Lira can impact the value of your investment.
• Economic Environment: High inflation and interest rates influence consumer spending. Changes in the economic climate can affect how much shoppers spend on the platform.
• Regulatory Pressure: Turkey has specific laws for e-commerce companies that influence how businesses manage advertising and promotional discounts. These regulations impact operational costs and the strategies used to acquire new customers.

6. The Bottom Line

Hepsiburada is playing the long game by evolving from a simple retailer into a financial and logistics hub. If you are considering an investment, look at their progress in integrating fintech services with their retail platform. As with any emerging market investment, it is important to weigh their growth strategy against the volatility of the local economic and regulatory environment.