Over the past six years, the local corporate bond market in Georgia has experienced rapid growth with a 29% compound annual growth rate and reached 2.5 billion GEL in outstanding public and private bonds, - according to the report by TBC Capital.
"The market growth was driven by continued activity of existing market participants as well as by regular inflows of new issuers, now comprising 23 active issuers, spanning close to 9 industries. Companies issue bonds for a variety of strategic purposes, including funding new projects and refinancing existing loans, while also achieving to diversify their investor base, improve financing terms, and optimize cash flow.
Investor demand for Georgian corporate bonds continues to grow year over year. Retail investors, in particular, are showing heightened interest in FX-denominated bonds, attracted by the competitive spreads they offer compared to local deposit rates. The market is seeing growing number of new investors and increasing liquidity in the secondary bond market.
Larger and GEL-denominated bonds are still predominantly supported by Georgian commercial banks, IFIs, and other institutional investors. While the capital markets in Georgia currently lack a diverse base of global investors, there are encouraging signs—early participation from asset managers suggests this landscape is beginning to evolve.
Looking ahead, the Georgian bond market has significant room for growth. Comparisons with similar European markets indicate considerable untapped potential, positioning Georgia as an emerging opportunity for both local and international investors", - the document reads.
