The FINANCIAL — Economy
Trade deficit down 4.6% y/y in 1H16, excluding one-offs
In June 2016, exports decreased 15.5% y/y to US$ 167.9mn, imports were up 3.0% y/y to US$ 625.0mn (excluding donated C-hepatitis medication imports totaling US$ 840mn), and the trade deficit was up 12.0% y/y to US$ 457.1mn, according to GeoStat.
Reduced copper exports (-13.5% y/y) and ferro-alloys exports (-63.4% y/y) were the major commodities weighing on export growth in June 2016, while car exports (+7.9% y/y), nuts (+235.4% y/y), mineral waters (+8.6% y/y), wine (+12.2% y/y), gold (+47.4% y/y) and spirituous beverages (+130.5% y/y) posted strong increases.
Petroleum (-8.5% y/y), cars (+19.5% y/y), pharmaceuticals (-9.9% y/y, excluding one-offs), phones (-0.8% y/y), and copper (+7.3%) represented the top 5 imported commodities in June 2016.
In 1H16, the trade deficit was down 4.6% y/y to US$ 2.32bn excluding one-offs, as imports fell 7.0% y/y to US$ 3.27bn and exports fell 12.4% y/y to US$ 948.2mn.
In 1H16, 24% of exports were directed to the EU (-22% y/y), 31% to the CIS (-29% y/y), and 45% to other countries (+15% y/y), out of which Turkey (11.1% of total), and China (9.4% of total) were the largest export destinations.
In 1H16, 29% of imports came from the EU (-16.7% y/y), 26% from the CIS (-8.3% y/y), and 45% from other countries (-8.3% y/y), with Turkey (20.6% of total), and China (7.9% of total) being the largest trading partners (calculations exclude C-hepatitis medication imports).
Fixed income
Corporate Eurobonds: Bank of Georgia Eurobonds (GEBGG) closed at 2.9% yield, trading at 104.4 (+0.3% w/w). GOGC’s Eurobonds (GEOROG 05/17) were trading at 101.9 (unchanged w/w), yielding 4.5% and (GEOROG 04/21) were trading at 104.6 (+0.2% w/w), yielding 5.6%. Georgian Railway Eurobonds (GRAIL) traded at a premium at 111.5 (+0.1% w/w), yielding 5.5%.
Georgian Sovereign Eurobonds (GEORG) closed at 111.5 (unchanged w/w) at 4.2% yield to maturity.
Equities
BGEO Group (BGEO LN) shares closed at GBP 27.36/share (-0.11% w/w and +6.25% m/m). More than 271k shares traded in the range of GBP 25.95 – 28.24/share. Average daily traded volume was 62k in the last 4 weeks, less than in the previous month. FTSE 250 Index, of which BGEO is a constituent, gained 1.42% w/w and lost 0.47% m/m. The volume of BGEO shares traded was at 0.69% of its capitalization.
TBC Bank (TBCB LI) closed the week at US$ 13.40 (unchanged w/w and -0.74% m/m). More than 106k GDRs changed hands in the range of US$ 13.20 – 13.40/GDR. Average daily traded volume was 31k in the last 4 weeks, more than in the previous month.
Georgia Healthcare Group (GHG LN) shares closed at GBP 3.02/share (-11.14% w/w and +6.01% m/m). More than 59k shares were traded in the range of GBP 2.87 – 3.40/share. Average daily traded volume was 28k in the last 4 weeks. The volume of GHG shares traded was at 0.02% of its capitalization.
Money Market
Refinancing loans: National Bank of Georgia (NBG) issued 7-day refinancing loans of GEL 625.5mn (US$ 266.4mn).
Certificates of deposit: NBG sold 91-day, GEL 20mn (US$ 8.5mn) certificates of deposit, with an average yield of 6.47% (up 2bps from previous issue).
Ministry of Finance Treasury Notes: 5-year GEL 20mn (US$ 8.5mn) T-Notes of Ministry of Finance were sold at the auction held at NBG on July 20, 2016. The weighted average yield was fixed at 8.669%. The nearest treasury securities auction is scheduled for July 27, 2016, where GEL 30mn nominal value 1-year T-Bills will be sold.
