Fitch Ratings has affirmed Coca-Cola Icecek AS's (CCI) Long-Term Issuer Default Rating (IDR) at 'BBB'.
The Outlook is Stable. A full list of rating actions is provided below.
The ratings reflect CCI's continued strong operating profitability, following the robust implementation of its expansion plan, leading to revenue and EBITDA growth. This is supported by the company's leading positions in its core markets, the resilient soft drinks business and its strong capital structure. The ratings continue to benefit from a single-notch uplift for strategic support from The Coca-Cola Company (TCCC), its parent, in line with Fitch's Parent and Subsidiary Linkage (PSL) Rating Criteria.
The ratings remain constrained by a weak operating environment in a number of CCI's markets of operation, and inherent FX risks related to hard currency-denominated debt and certain operating costs.
Key Rating Drivers
Normalised Revenue Growth: We use inflation-adjusted numbers in our forecasts. We expect CCI's organic growth to continue in 2026, despite a persistently challenging macroeconomic environment. In Turkiye (BB-/Stable), we forecast organic volume growth in the low single digits in 2026, constrained by local competition and weak consumer sentiment. In international markets, we expect volume growth to be in the high single digits, driven by growing demand and purchasing power improvement, as well as ongoing investments, new product categories and more favourable mix
Flat Profitability: We project profitability will remain stable, at 17.3%, in 2026 as persistent inflationary pressures from raw material costs like sugar, aluminum and resin, are partly offset by limited pricing adjustments, packaging optimisation and operating efficiencies. We expect profitability to rebound towards 18% from 2028, driven by proactive procurement, a better product mix and cost-reduction initiatives
Temporarily Weak Cash Flow: We expect free cash flow (FCF) in 2026 to remain under pressure from high capex, projected at 8.5% of sales, due to the expansion of manufacturing lines and greenfield projects in Kazakhstan before gradually recovering towards 3% from 2028, supported by EBITDA growth, interest rate normalisation and lower capex. We assume CCI will adhere to its maximum dividend payout of 50%, which favours cash accumulation and deleveraging.
Inflation Accounting Modest Impact: CCI has implemented inflation accounting in accordance with IAS29 for its Turkish operations (39% of revenue in 2025), while its international operations remain unaffected. Inflation accounting adjusted 2025 profit and loss for year-end inflation, with a minor impact on depreciation and amortisation and inventory values and reported monetary gains of about TRY7 billion after EBITDA.
Temporarily Weaker Interest Coverage: interest coverage ratio weakened to 2.3x in 2025, below its negative sensitivity of 6.5x, due to IAS29 application, rising interest rates and increased share of local borrowings. We project a rebound to 6.5x by 2027 on higher profitability and lower interest rates.
High but Manageable FX Risks: About 62% of CCI's debt and 25% of production costs were denominated in hard currencies at end-2025, in contrast to revenue, which was mainly in emerging markets' local currencies. This results in high FX risks, which the company manages by improving geographic diversification towards less volatile countries and holding excess cash in hard currency.
Conservative Capital Structure Intact: CCI's conservative financial policy targets EBITDA net leverage at below 2.0x, but with tolerance for a temporary breach for value-enhancing M&A. This disciplined approach is further underpinned by the strong liquidity and a sizable cash balance of about 75% of EBITDA. This provides additional financial flexibility and supports CCI's capacity to absorb short-term leverage increases.
One-Notch Uplift for TCCC Support: Fitch applies a 'bottom-up plus one notch' approach to CCI's 'bb+' Standalone Credit Profile (SCP) after factoring in the operating environment, reflecting TCCC's 'Medium' operational and strategic incentives for support. This is based on shared brands and the strategic, operational and innovation support provided by TCCC. We assess legal incentives as 'Low'. TCCC's moderate 20% ownership of CCI constrains the uplift to one notch, as it creates uncertainty about the extent of potential support to the latter, in view of the presence of a majority shareholder, Anadolu Efes Biracilik ve Malt Sanayii A.S. (AEFES, BB/Negative) and CCI's public listing.
Insulated Ringfencing from AEFES: CCI's credit profile is insulated from that of AEFES, its weaker parent, which holds 50.3% of the former's shares. This insulation results from AEFES's limited control over CCI, which is constrained by TCCC's significant voting rights. In addition, CCI's and AEFES's treasury functions and debt structures are fully ringfenced from each other.
Weak Operating Environment: The operating environment in CCI's core markets, which we assess at 'bb-', continues to have a moderate influence on its ratings. These countries face high volatility from their exposure to geopolitical events and macroeconomic conditions, which tend to result in high inflation and FX fluctuations. These dynamics are a threat to consumer sentiment across the region, even though CCI has a strong record of operating under these challenging conditions.
Kazakhstan Country Ceiling: We apply the 'BBB+' Country Ceiling of Kazakhstan to CCI's rating, rather than Turkiye's, where CCI is incorporated. We calculate that cash flows from Kazakhstan (2025: 22% of EBITDA) should continue to cover CCI's hard-currency interest charges with sufficient headroom, given the company's conservative capital structure with projected hard-currency interest expenses of about TRY1.9 billion in 2026.
Low Transfer and Convertibility Risks: Fitch assesses transfer and convertibility risks for Kazakhstan as low and we do not foresee any difficulties for CCI to move funds, either through dividends or intercompany loans, from Kazakhstan to Turkiye.
Peer Analysis
CCI is among the 10 largest bottlers in the TCCC system by sales volume and has the highest Long-Term IDR among Fitch-rated corporates in Turkiye. CCI is smaller than Coca-Cola Europacific Partners plc (CCEP, A-/Stable) and Coca-Cola FEMSA, S.A.B. de C.V. (A/Stable), its main peers, operates in more volatile emerging markets and has greater exposure to FX risk.
However, CCI's improved profitability is now in line with or above its main peers', while its conservative capital structure is commensurate with Fitch-rated high investment-grade non-alcoholic beverage companies'.
CCI's ratings benefit from a one-notch uplift for potential support from TCCC. This is in line with Fitch's approach to CCEP, which also has ratings that benefit from our assessment of TCCC's 'Medium' operational and strategic incentives for support.
At the same time, CCI's SCP reflects moderate pressure from a weak operating environment in the markets in which it operates, capping its SCP at the current level.
Fitch's Key Rating-Case Assumptions
Turkish lira/US dollar on average at 46.4 in 2026, weakening to 52.5 in 2027
Turkish sales volumes to increase by low single digits in 2026-2029. Average selling price to rise 30% in 2026, and decline by an average of 22% in 2026-2029
International sales volumes to expand in the mid-to-high single digits between 2026 and 2029
Consolidated EBITDA margin flat at 17.3% in 2026 (2025: 17.2%), before gradually increasing to 17.7% in 2028-2029
Capex at 8.5% of net sales in 2026 and 8% in 2027-2029
Dividends of TRY4 billion in 2026 (2025: TRY3.5 billion), and rising towards TRY5 billion-6.5 billion in 2027-2029
Corporate Rating Tool Inputs and Scores
Fitch scored the issuer as follows, using our Corporate Rating Tool (CRT) to produce SCP:
Business and financial profile factors (assessment, relative importance): management ('bbb+', Lower), sector characteristics ('a-', Lower), market and competitive positioning ('bbb', Higher), diversification and asset quality ('bbb-', Moderate), company operational characteristics ('bbb', Moderate), profitability ('bbb+', Moderate), financial structure ('a+', Moderate), and financial flexibility ('bbb-', Higher).
The quantitative financial subfactors are based on standard CRT financial period parameters: 20% weight for the historical year 2025, 40% for the forecast year 2026 and 40% for the forecast year 2027.
The governance assessment of 'good' has no impact.
The operating environment assessment of 'bb-' results in an adjustment of -2 notch(es).
The calibration adjustment applies and results in an adjustment of 1 notch(es).
The SCP is 'bbb-'.
To derive the Long-Term IDR:
Application of Fitch's PSL Criteria results in a(n) bottom up +1 approach.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
Adverse impact of weaker operating and macro conditions in CCI's core markets on credit metrics, not accompanied by adequate cash-preservation measures, such as dividend or capex reduction
Increased volatility translating into FCF (after capex and dividends) margins remaining consistently below 2%
EBITDA net leverage above 2.5x
EBITDA interest coverage below 6.5x
EBITDA margin falling towards 16%
Weakening linkages with TCCC
A downgrade of Kazakhstan's Country Ceiling or insufficient EBITDA generation in the country to cover hard-currency interest expenses in the medium term would result in a downgrade of the Long-Term Foreign-Currency IDR
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
Upside is constrained over the medium term by CCI's weak operating environment. As we do not expect changes in the strength of ties with TCCC, an upgrade would depend on CCI's SCP, based on the following factors:
EBITDA margin sustained at or above 20%
Enhanced scale and geographic diversification, either organically or through M&A, without impairing the operating-environment score
Conservative financial structure, with EBITDA net leverage below 1.7x on a sustained basis
Liquidity and Debt Structure
At end-March 2026, liquidity was supported by a cash balance of about USD573million-equivalent, with about 45% in hard currencies, of which about 97% was outside Turkiye.
Liquidity is also supported by USD1.8 billion-equivalent undrawn and uncommitted credit facilities in Turkiye, Pakistan, Kazakhstan, Turkmenistan and Azerbaijan, which can be used in hard or local currencies according to market conditions. However, Fitch does not include availability under uncommitted credit lines in its liquidity calculation.
Issuer Profile
CCI is among the top 10 largest bottlers in the Coca-Cola system by sales volumes, with most sales generated in Turkiye, Kazakhstan, Pakistan and Uzbekistan.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Click here to access Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in our credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included.
Climate Vulnerability Signals
The results of our Climate.VS screener did not indicate an elevated risk for CCI.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit https://www.fitchratings.com/topics/esg/products#esg-relevance-scores.
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