Galt&Taggart published Weekly Market Watch:
Fitch affirms Georgia's credit rating at BB with a Stable Outlook
On 4 February 2022 Fitch Ratings affirmed Georgia’s sovereign credit rating at BB with a Stable Outlook. Based on Fitch, the rating is supported by a credible and effective policy framework and stronger governance indicators relative to 'BB' peers. In the assessment repot, Fitch underlined that Georgia’s growth was a robust in 2021, which has been driven by domestic demand, strong inflows of net remittances, a partial tourism recovery, and fiscal stimulus.
Moreover, growth in exports of goods also performed strongly due to the recovery of key trading partners and higher commodity prices. According to Fitch, Georgia's economy is expected to grow by 5.5% and 5.3% in 2022 and 2023, respectively, above potential of 4.0%-4.5%. Fitch forecasts tourism revenues to recover to 80% of 2019 levels in 2022, after reaching 38.1% of 2019 levels in 2021. Based on Fitch, risks surrounding the pandemic and low vaccination rate pose downside risks to GDP outlook.
International reserves at US$ 4.1bn in January 2022 Gross international reserves decreased by 0.6% y/y to US$ 4.1bn in January 2022 according to NBG. On a monthly basis, the reserves were also down by 4.5% (-US$ 194.0mn). There were no FX auctions in January and changes in reserves were attributed to the government and banking sector FX operations, and/or asset revaluation.
Money market
Ministry of Finance T-Bills: 1-year GEL 20.0mn (US$ 6.8mn) T-Bills were sold at the auction held at NBG on February 8, 2022. Total demand was c.2.3x higher and the weighted average yield was fixed at 9.913%, down by 0.094ppts from the previous auction held in January, 2022. The nearest treasury security auction is scheduled for February 22, 2022, where GEL 80.0mn nominal value 5-year Benchmark Bonds will be sold.
Fixed income
Corporate Eurobonds: Bank of Georgia Group Eurobonds (GEBGG) closed at 2.15% yield, trading at 105.46 (+0.02% w/w). Georgia Capital Eurobonds (GEOCAP) were trading at 101.03 (+0.18% w/w), yielding 5.59%. Georgian Railway Eurobonds (GRAIL) traded at 97.05 (-1.07% w/w), yielding 4.54%.
Georgian Sovereign Eurobonds (GEORG) closed at 96.53 (-0.96% w/w) at 3.65% yield to maturity.
Equities
Bank of Georgia Group (BGEO LN) shares closed at GBP 15.80/share (+8.97% w/w and +0.89% m/m). More than 379k shares traded in the range of GBP 14.28 - 15.80/share. The average daily traded volume was 59k in the last 4 weeks. The volume of BGEO shares traded was at 0.77% of its capitalization.
TBC Bank Group (TBCG LN) closed the week at GBP 16.00/share (+10.65% w/w and +4.30% m/m). More than 130k shares changed hands in the range of GBP 14.50 - 16.02/share. Average daily traded volume was 32k in the last 4 weeks. The volume of TBCG shares traded was at 0.24% of its capitalization.
Georgia Capital (CGEO LN) shares closed at GBP 6.81/share (-0.58% w/w and +1.64% m/m). More than 314k shares traded in the range of GBP 6.69 - 7.05/share. Average daily traded volume was 118k in the last 4 weeks. The volume of CGEO shares traded was at 0.66% of its capitalization.
