Georgia Capital

Business as usual despite political turmoil

3 September 2024

Georgia Capital’s (GCAP’s) net asset value (NAV) per share decreased by 12.8% quarter-on-quarter in Q224 in Georgian lari (down 16.5% in sterling terms). This was mostly due to the widening of bond yields and credit spreads amid the latest political turmoil in Georgia. The de-rating of Bank of Georgia’s (BoG’s) shares had a 7.1pp impact on GCAP’s NAV, while higher discount rates applied to value the private portfolio companies contributed a further 7.5pp drag. Meanwhile, portfolio companies continue their expansion and dividend distributions, with GEL105m collected by GCAP to 12 August 2024, and management reiterated its dividend income outlook of GEL180–190m in FY24 (c 5% yield on the opening portfolio value). GCAP has recently increased its share buyback programme, with US$16.7m remaining to be repurchased as of 30 August 2024. MORE »

FY23 NAV TR of 20% in sterling terms

23 February 2024

Georgia Capital (GCAP) reported a Q423 NAV total return (TR) of 7.7% in Georgian lari (GEL) terms (3.4% in sterling terms), bringing the FY23 NAV TR to a strong 26.5% (20.4% in sterling terms). The considerable increase in the sterling share price of Bank of Georgia (BoG) was the main contributor, adding c 5.1% and 19.5% to GCAP’s opening NAV in Q423 and FY23, respectively. This was further assisted by positive revaluation of all large and investment-stage private holdings, except for the hospital business. In aggregate, GCAP’s private holdings added 1.9pp to its Q423 NAV TR. NAV-accretive buybacks of US$8.3m added a further 0.9pp. MORE »

Value creation on the back of macro recovery

13 September 2021

Georgia Capital (GCAP) posted a 13.2% NAV total return (TR) in local currency terms in H121 (15.2% in sterling), driven by an improved operating performance across its private holdings (assisted by Georgia’s 12.7% y-o-y real GDP rebound in H121), a c 10% rise in the Bank of Georgia’s share price and appreciation of the Georgian lari versus the US dollar. GCAP continues to focus its new investments on the education and renewable energy sectors. It recently announced a school acquisition and the opening of another campus in the affordable education segment, which will expand its capacity from 3,500 to 5,300 learners from September 2021. MORE »

Solid positive revaluations in Q420

5 March 2021

Georgia Capital (GCAP) posted a 27.2% NAV total return (TR) in local currency terms in Q420 on the back of solid valuation uplifts across all key portfolio holdings. This, together with the Q320 revaluation of GHG after it was made private (see our initiation note for details), offset the weak performance of GCAP’s hospitality and commercial real estate business and the subdued share price performance of Bank of Georgia in 2020. Consequently, GCAP’s FY20 NAV TR reached 2.7% in local currency (though -13.3% in sterling terms). The NAV uplift helped reduce GCAP’s loan-to-value (LTV) at the holding level from 44.1% at end-March 2020 to 28.9% at end-2020. GCAP’s new investments remain centred around renewable energy and education. MORE »

A private equity play on Georgia

8 December 2020

Georgia Capital (GCAP) has a unique position as an experienced institutional financial investor in Georgia with superior access to attractive private investment opportunities. Its management team has built several market leaders before BGEO’s de-merger into Bank of Georgia (BoG) and GCAP, which remain in GCAP’s portfolio. A few of them are valued at c GEL0.5bn (c US$150m) and may be ripe for an exit in the medium term, which could help validate GCAP’s strategy. Due to COVID-19, the company decided to focus its existing portfolio investments on the local renewable energy (wind and hydro) and private education sectors. MORE »