Weekly Market Watch by Galt & Taggart

Weekly Market Watch by Galt & Taggart

Weekly Market Watch by Galt & Taggart

The FINANCIAL -- Economy

Tourist arrivals up 27.1% y/y in February 2018

Total international arrivals to Georgia increased 19.8% y/y to 0.44mn visitors in February 2018, according to the Ministry of Internal Affairs. A 27.1% y/y growth in tourist arrivals (0.18mn persons, 40.3% of total) drove arrival growth. Out of top countries by arrivals, in February 2018, visitors continued to increase from Armenia (+27.1% y/y), Turkey (+28.1% y/y), Russia (+24.2% y/y) and Iran (+130.6% y/y) while arrivals were down from Azerbaijan (-2.2% y/y). Arrivals from EU were up 27.7% y/y to over 15,627 visitors. Overall in 2M18 international arrivals were up 17.2% to 0.89mn persons while tourist arrivals were up 24.9% to 0.37mn persons.

International reserves up 8.7% y/y in February 2018

Gross international reserves were up 8.7% y/y to US$ 3.0bn in February 2018, while reserves were down 1.5% m/m, according to NBG. There were no FX interventions by central bank in February. Change in reserves was attributed to government FX operations and/or asset revaluation.

Fixed income

Corporate Eurobonds: BGEO Group Eurobonds (BGEOLN) closed at 5.5% yield, trading at 102.3 (-1.0% w/w). Bank of Georgia GEL-denominated Eurobonds (GEBGG) were trading at 100.5 (unchanged w/w), yielding 10.7%. GOGC Eurobonds (GEOROG) were trading at 104.7 (-0.5% w/w), yielding 5.0%. Georgian Railway Eurobonds (GRAIL) traded at a premium at 110.2 (-0.3% w/w), yielding 5.1%.

Georgian Sovereign Eurobonds (GEORG) closed at 109.1 (-0.3% w/w) at 3.7% yield to maturity. Georgia Eurobonds, YTM (%)

Equities

BGEO Group (BGEO LN) shares closed at GBP 34.80/share (+1.58% w/w and +1.69% m/m). More than 396k shares traded in the range of GBP 32.94 – 35.32/share. Average daily traded volume was 92k in the last 4 weeks. FTSE 250 Index, of which BGEO is a constituent, gained 3.53% w/w and gained 4.44% m/m. The volume of BGEO shares traded was at 1.01% of its capitalization.

TBC Bank Group (TBCG LN) closed the week at GBP 18.40 (+13.58% w/w and +16.60% m/m). More than 235k shares changed hands in the range of GBP 16.06 – 18.40 share. Averaged daily traded volume was 34k in the last 4 weeks.

Georgia Healthcare Group (GHG LN) shares closed at GBP 3.27/share (-1.06% w/w and +0.46% m/m). More than 49k shares were traded in the range of GBP 3.20 – 3.40/share. Average daily traded volume was 9k in the last 4 weeks. The volume of GHG shares traded was at 0.04% of its capitalization.

Money Market

Ministry of Finance Treasury Notes:

1-year GEL 40.0mn (US$ 16.4mn) T-Notes of Ministry of Finance were sold at the auction held at NBG on March 7, 2018. The weighted average yield was fixed at 7.329%. The nearest treasury security auction is scheduled for March 14, 2018, where GEL 40.0mn nominal value 2-year T-Notes and GEL 20.0mn nominal value 182-days T-Bills will be sold.