Digitalization And Rising Incomes Will Expand Cashless Markets

Key Takeaways

• Kaspi's superapp ecosystem and rapid multi-vertical expansion position it to outperform in Turkey and Central Asia, boosting revenue, margins, and user growth.
  
• Accelerating adoption of Kaspi payment solutions and strong logistics capabilities offer significant upside in transaction volumes and high-margin growth across new sectors.
  
• Heavy domestic focus, regulatory pressures, rising competition, and fintech industry shifts threaten Kaspi.kz's future growth, margins, user retention, and ability to monetize data.

Catalysts

Provides payments, marketplace, and fintech solutions for consumers and merchants in Kazakhstan, Azerbaijan, and Ukraine.

• Analyst consensus expects Hepsiburada to be a mid-term opportunity, but given the sharp recovery in volumes, rapid GMV and margin expansion, and imminent banking license, Kaspi can leverage its superapp playbook to drive step-change earnings contribution in Turkey much faster than currently modeled, materially boosting consolidated revenue and profitability in coming years.
  
• While analysts broadly agree on the e-Grocery opportunity in Kazakhstan, they are underestimating the speed of multi-vertical expansion and operating leverage: Kaspi's mastery in scaling complex logistics networks and its cross-vertical user engagement suggest e-Grocery-and future verticals like restaurant and travel-can both achieve well above market-growth rates and deliver rapid margin inflection as scale-driven efficiencies kick in.
  
• The accelerating adoption of Kaspi QR and open network payment solutions, not fully appreciated by the market, positions Kaspi to become the de facto payments infrastructure across Central Asia, unlocking exponential transaction volume growth and sustained take-rate upside, with positive impact on revenue and net income.
  
• Kaspi's superapp ecosystem-now proven to catalyze strong cross-selling, frequency, and user retention-is poised to monetize the ongoing shift to cashless economies and surging internet penetration in Central Asia faster than peers, substantially expanding the company's addressable market and driving high-margin user and TPV growth.
  
• Once the current high interest rate cycle abates, Kaspi's dramatically enlarged deposit base and increased customer 'stickiness' from recent product launches will enable an outsized expansion in Fintech net margins and earnings, far outpacing consensus estimates for bottom-line improvement.

Kaspi.kz Future Earnings and Revenue Growth

Assumptions

• This narrative explores a more optimistic perspective on Kaspi.kz compared to the consensus, based on a Fair Value that aligns with the bullish cohort of analysts.
• The bullish analysts are assuming Kaspi.kz's revenue will grow by 24.8% annually over the next 3 years.
• The bullish analysts assume that profit margins will increase from 34.3% today to 34.8% in 3 years time.
• The bullish analysts expect earnings to reach KZT 2151.1 billion (and earnings per share of KZT 11109.63) by about August 2028, up from KZT 1091.0 billion today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the price target of the more bullish analyst cohort, the company would need to trade at a PE ratio of 8.3x on those 2028 earnings, down from 9.0x today. This future PE is lower than the current PE for the US Consumer Finance industry at 9.7x.
• Analysts expect the number of shares outstanding to grow by 0.4% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 9.85%, as per the Simply Wall St company report.

Kaspi.kz Future Earnings Per Share Growth

Risks

• Kaspi.kz's business remains heavily concentrated in Kazakhstan, exposing it to domestic macroeconomic volatility and possible currency devaluation, which could cause revenue variability and margin compression over time.
  
• Heightened global regulatory scrutiny on fintech and big tech may increase compliance costs, particularly as Kaspi.kz expands into new markets like Turkey, putting downward pressure on net margins and operational flexibility.
  
• The accelerating shift toward open banking and greater data portability could undermine Kaspi.kz's data advantage and make it easier for users to switch services, threatening future user retention and causing slower revenue growth.
  
• Intensifying competition from local incumbents modernizing their digital platforms and global fintech players entering the region may erode Kaspi.kz's market share, leading to margin pressure and ultimately impacting future earnings growth.
  
• Industry trends such as central bank digital currency adoption and stricter data privacy regulations could disrupt traditional payment flows and limit data monetization, directly reducing payment revenues and net profitability.

Valuation

• The assumed bullish price target for Kaspi.kz is KZT129.2, which is the highest price target estimate amongst analysts. This valuation is based on what can be assumed as the expectations of Kaspi.kz's future earnings growth, profit margins and other risk factors from analysts on the bullish end of the spectrum.
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of KZT129.2, and the most bearish reporting a price target of just KZT85.53.
• In order for you to agree with the bullish analysts, you'd need to believe that by 2028, revenues will be KZT6180.0 billion, earnings will come to KZT2151.1 billion, and it would be trading on a PE ratio of 8.3x, assuming you use a discount rate of 9.8%.
• Given the current share price of KZT95.91, the bullish analyst price target of KZT129.2 is 25.8% higher.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.