Weekly Market Watch by Galt & Taggart

Weekly Market Watch by Galt & Taggart

Weekly Market Watch by Galt & Taggart

The FINANCIAL -- Exports up 32.0% y/y in June 2018

In June 2018, exports increased 32.0% y/y to US$ 308.9mn, imports grew by 19.8% y/y to US$ 771.2mn and the trade deficit widened 12.8% y/y to US$ 462.3mn, according to GeoStat’s preliminary figures. In 1H18, trade deficit was up 19.9% to US$ 2.8bn as exports increased by 28.8% y/y to US$ 1.6bn and imports were up 23.0% y/y to US$ 4.4bn. Detailed foreign trade statistics will be available on July 19, 2018.

NBG continues to build reserves

On July 11, 2018, the NBG intervened on the FX market and purchased US$ 10mn to curb GEL’s appreciation. YDT, NBG purchased US$ 60mn and GEL strengthened 5.6% against USD.

Fixed income

Corporate Eurobonds: Bank of Georgia Group Eurobonds (GEBGG) closed at 6.0% yield, trading at 99.8 (+0.1% w/w). Bank of Georgia GEL-denominated Eurobonds (GEBGG) were trading at 100.5 (+0.5% w/w), yielding 10.7%. Georgia Capital Eurobonds (GEOCAP) were trading at 94.3 (+0.1% w/w), yielding 7.4%.

GOGC Eurobonds (GEOROG) were trading at 101.6 (+0.6% w/w), yielding 6.1%. Georgian Railway Eurobonds (GRAIL) traded at a premium at 106.0 (+0.5% w/w), yielding 6.0%.

Georgian Sovereign Eurobonds (GEORG) closed at 106.8 (+0.1% w/w) at 4.2% yield to maturity. Georgia Eurobonds, YTM (%)

Equities

Bank of Georgia Group (BGEO LN) shares closed at GBP 18.56/share (+3.17% w/w and -1.28% m/m). More than 273k shares traded in the range of GBP 17.96 – 18.94/share. Average daily traded volume was 92k in the last 4 weeks. FTSE 250 Index, of which BGEO is a constituent, gained 0.94% w/w and lost 1.98% m/m. The volume of BGEO shares traded was at 0.56% of its capitalization.

Georgia Capital (CGEO LN) shares closed at GBP 10.43/share (+2.70% w/w and -2.96% m/m). More than 641k shares traded in the range of GBP 10.19 – 10.57/share. Average daily traded volume was 131k in the last 4 weeks.The volume of CGEO shares traded was at 1.66% of its capitalization.

TBC Bank Group (TBCG LN) closed the week at GBP 17.30 (-0.12% w/w and +0.01% m/m). More than 88k shares changed hands in the range of GBP 17.10 – 17.82/share. Average daily traded volume was 34k in the last 4 weeks.

Georgia Healthcare Group (GHG LN) shares closed at GBP 2.62/share (-4.03% w/w and +3.76% m/m). More than 59k shares were traded in the range of GBP 2.63 – 2.90/share. Average daily traded volume was 18k in the last 4 weeks. The volume of GHG shares traded was at 0.04% of its capitalization.

Money Market

Refinancing loans: National Bank of Georgia (NBG) issued 7-day refinancing loans of GEL 830mn (US$ 340.1mn).

Certificates of deposit: NBG sold 91-day, GEL 20mn (US$ 8.2mn) certificates of deposit, with an average yield of 7.31% (up 0.02ppts from previous issue).

Ministry of Finance Benchmark Bonds:
2-year GEL 40.0mn (US$ 16.4mn) Benchmark Bonds of Ministry of Finance were sold at the auction held at NBG on July 11, 2018. The weighted average yield was fixed at 7.465%. The nearest treasury security auction is scheduled for July 18, 2018, where GEL 25mn nominal value 10-year Benchmark bonds will be sold.

Ministry of Finance Treasury Bills:
182-days GEL 20.0mn (US$ 8.2mn) T-Bills of Ministry of Finance were sold at the auction held at NBG on July 11, 2018. The weighted average yield was fixed at 7.362%.