* Arcelik may beat growth target of 2-2.5 percent
* Domestic Q1 sales probably down 20 percent qtr/qtr
* March Turkey sales up 50 pct mth/mth after govt. tax cut
* Plans to cut 2009 investments by 50 percent from last year
(Adds debt, capital increase details)
By Thomas Grove and Tolgahan Ozkan
ISTANBUL, April 2 (Reuters) - Turkey's Arcelik, Europe's third-biggest white-goods maker, may see sales grow slightly more than an earlier target of between 2 percent and 2.5 percent, its chief, Aka Gunduz Ozdemir, said on Thursday.
Arcelik will also halve its investments this year as it tries to save money during the global economic crisis, Ozdemir said in an interview with Reuters.
The company is raising its performance target on increased domestic sales following tax cuts on consumer durables and on signs that European markets are beginning to recover.
"It seems that things are a little better in Europe than what we planned," Ozdemir said. "We were worried about Britain, but the first two months were better than we planned.
"We planned 2-2.5 percent growth for this year, but it may be better than that," he said.
Arcelik, which is 39.4 percent owned by Turkish conglomerate Koc Holding, is the country's biggest maker of consumer durables. Half of its income comes from domestic sales.
Total sales were 6.78 billion lira ($4.19 billion) in 2008.
Turkish sales probably fell 20 percent quarter-on-quarter in the first three months of 2009, Ozdemir said, adding that revenue in March had grown 50 percent month-on-month after the government cut taxes for the sector last month.
"January was very bad, and it was only in March that we started recovering," he said.
Arcelik accounts for 54 percent of the refrigerators, washing machines and other white goods sold in Turkey. The sector has been hard hit by a weaker lira as well as a fall in domestic and European consumption.
The government's lifting of the special consumption tax on consumer durables was part of a series of broader economic stimulus measures. The suspension took effect in March and will last a total of three months.
Ozdemir said it was too early to tell how the stimulus measure would play out in April and May.
DEBT PAYBACK
Fitch Ratings downgraded two of Arcelik's ratings last month due in part to higher than expected debts of 3.5 billion lira at end-2008, more than half of which have to be paid back in the second half of 2009 and in 2010, the ratings agency said.
Ozdemir said Arcelik would have no trouble raising the funds to pay back the debt due to capital increases and planned spending cuts.
Arcelik this year will spend half of the 187 million euros ($249 million) it spent on investments last year as it seeks to curb costs, Ozdemir said.
Funds from a capital increase are also expected to enter the company's coffers at the latest by end May, he said.
By 1423 GMT, Arcelik shares were up 2.15 percent to 1.90 lira in a broadly positive market. (Editing by Simon Jessop and Andrew Macdonald) ($1.334=1 euro) ($1=1.6181 lira)