Weekly Market Watch by Galt & Taggart

Weekly Market Watch by Galt & Taggart

The FINANCIAL -- Economy

Tourist arrivals up 32.4% y/y in January 2017 

Total international arrivals to Georgia increased 19.8% y/y to 0.39mn visitors in January 2017, according to the Ministry of Internal Affairs. Arrival growth was mainly driven by surge in tourist arrivals increasing 32.4% y/y to 0.15mn persons (39.8% of total) in January 2017 after posting a 19.0% y/y growth in 2016. Out of top countries by arrivals, in January 2017 visitors continued to increase from Armenia (+31.4% y/y), Azerbaijan (+7.1% y/y), Russia (+40.3% y/y), and Ukraine (+14.0% y/y), while arrivals were flat from Turkey (-0.8% y/y). Arrivals from EU were up 26.1% y/y. 

International reserves up 14.3% y/y in January 2017 

Gross international reserves were up 14.3% y/y to US$ 2.8bn in January 2017, while reserves were up 1.4% m/m (+US$ 39.7mn), according to NBG. The increase in reserves was related to government FX operations and/or asset revaluation.

Fixed income

Corporate Eurobonds: Bank of Georgia Eurobond (BGEOLN) closed at 5.7% yield, trading at 101.6 (+0.1% w/w).  GOGC Eurobonds - GEOROG 05/17 traded at 100.7 (+0.1% w/w), yielding 4.1% and GEOROG 04/21 traded at 105.4 (-0.2% w/w), yielding 5.3%. Georgian Railway Eurobond (GRAIL) traded at a premium at 109.8 (+0.4 % w/w), yielding 5.7%. 

Georgian Sovereign Eurobond (GEORG) closed at 111.3 (+0.3% w/w) at 3.3% yield to maturity.

Equities

BGEO Group (BGEO LN) shares closed at GBP 30.92/share (+2.76% w/w and +9.46% m/m). More than 315k shares traded in the range of GBP 29.52 – 31.06/share. Average daily traded volume was 153k in the last 4 weeks, more than in the previous month. FTSE 250 Index, of which BGEO is a constituent, gained 1.61% w/w and gained 1.61% m/m. The volume of BGEO shares traded was at 0.80% of its capitalization.

 TBC Bank Group (TBCG LN) closed the week at GBP 14.45 (-0.34% w/w and unchanged m/m). More than 58k shares changed hands in the range of GBP 14.20 – 14.80/share. Averaged daily traded volume was 30k in the last 4 weeks.

Georgia Healthcare Group (GHG LN) shares closed at GBP 3.50/share (-2.14% w/w and +2.31% m/m). More than 76k shares were traded in the range of GBP 3.40 – 3.50/share.  Average daily traded volume was 12k in the last 4 weeks. The volume of GHG shares traded was at 0.06% of its capitalization.

Money Market

Refinancing loans: National Bank of Georgia (NBG) issued 7-day refinancing loans of GEL 1,058mn (US$ 397.2mn).

Ministry of Finance Treasury Bills: 182-days GEL 20.0mn (US$ 7.5mn) T-Bills of Ministry of Finance were sold at the auction held at NBG on February 8, 2017. The weighted average yield was fixed at 7.040%. 

Ministry of Finance Treasury Notes: 2-year GEL 40.0mn (US$ 15.0mn) T-Notes of Ministry of Finance were sold at the auction held at NBG on February 8, 2017. The weighted average yield was fixed at 8.210%. The nearest treasury security auction is scheduled for February 15, 2017, where GEL 20.0mn nominal value 10-year T-Notes will be sold.