Last close As at 05/08/2026
GBP43.30
▲ −170.00 (−3.78%)
Market capitalisation
GBP1,466m
Research: Investment Companies
Georgia Capital (GCAP) continued to make progress on its strategic priorities in Q123: reduction in the net capital commitment (NCC) ratio, deleveraging its portfolio companies, selling subscale businesses, executing tactical buybacks (a US$10m programme was announced in April 2023), further investments in the renewable energy and education businesses and moving to the LSE standard listing. GCAP operates against the backdrop of strong GDP growth in Georgia at 7.2% y-o-y in Q123 (after 10.1% in 2022), where inflation seems largely contained, with headline and core inflation rates of 2.7% and 4.7% in April 2023, respectively. GCAP’s share price has been rising but is yet to catch up with the growing NAV and implies a 64% discount to the ‘live’ NAV estimate.
Georgia Capital |
Staying on course |
Investment companies |
15 May 2023 |
Analysts
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Georgia Capital (GCAP) continued to make progress on its strategic priorities in Q123: reduction in the net capital commitment (NCC) ratio, deleveraging its portfolio companies, selling subscale businesses, executing tactical buybacks (a US$10m programme was announced in April 2023), further investments in the renewable energy and education businesses and moving to the LSE standard listing. GCAP operates against the backdrop of strong GDP growth in Georgia at 7.2% y-o-y in Q123 (after 10.1% in 2022), where inflation seems largely contained, with headline and core inflation rates of 2.7% and 4.7% in April 2023, respectively. GCAP’s share price has been rising but is yet to catch up with the growing NAV and implies a 64% discount to the ‘live’ NAV estimate.
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GCAP is trading at a wide discount to its end-March 2023 NAV |
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Source: GCAP, Refinitiv. Note: Portfolio values as at end-March 2023. |
NAV assisted by private valuations, buyback and BoG
GCAP’s NAV per share was up 3.3% in Georgian lari (6.4% in sterling) in Q123, with its private portfolio contributing 2.0pp (mostly retail pharmacy, renewable energy and insurance businesses). Buybacks provided a further 1.1pp NAV accretion, while the listed Bank of Georgia (BoG) added another 0.7pp to GCAP’s NAV total return. Revenue across GCAP’s private holdings rose by 10% y-o-y in Q123, while EBITDA went up only slightly, by 0.9% y-o-y. Excluding hospitals and clinics & diagnostics, which are yet to fully ramp up after the expiry of government COVID-19 contracts and the decline in COVID-19 testing post Q122, revenue and EBITDA grew by 15.9% and 12.0% y-o-y, respectively.
Leverage down at holding and portfolio level
GCAP’s Q123 NCC ratio was down by 1.4pp to 19.7% at end-March 2023 (vs an over-the-cycle target of c 15%) on the back of a 7.8% increase in portfolio value and broadly stable NCC. After accounting for post-period end developments to 5 May (BoG dividend and share price increase, further GCAP buybacks and FX), the NCC ratio stood at 19.1%. We note that GCAP currently holds US$79m of its US$300m Eurobonds (maturing in Q124) after buying US$28m ytd. In Q123, it sold two operational hotels and a vacant land plot in Tbilisi (in line with its strategy of selling down subscale businesses) for US$28m, which was used in full to deleverage the hospitality business. This helped reduce net debt to EBITDA across its private businesses to 3.0x at end-March 2023 from 3.3x at end-2022. GCAP also agreed to sell a hotel under construction in April 2023 for US$8.4m.
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Research: Investment Companies
The Brunner Investment Trust (BUT) is led by a very strong team at Allianz Global Investors (AllianzGI). Its two co-managers, Christian Schneider (deputy CIO Global Growth) and Julian Bishop (global equity specialist), are supported by deputy managers Marcus Morris-Eyton (European equity specialist) and Simon Gergel (CIO UK Equities). The trust has notably outperformed its benchmark over each of the last four financial years despite significant market rallies and falls and periods of growth and value stock leadership. BUT’s NAV total return is above the average of the 13 funds in the AIC Global sector over the last one, three and five years (ranking second over three years). The trust has delivered 51 consecutive years of higher dividends plus capital growth for investors.