Georgia Capital

This is The Conviction Play. Georgia Capital, holding company. Part of our Capital Formation series, which looks at the businesses that build and allocate capital in frontier and emerging markets. This is the piece we published on it in November 2025, and the figures in it are from then.

Georgia Capital is a London-listed holding company with majority stakes in several of Georgia's largest private-sector businesses. A national network of hospitals, clinics and diagnostics. A pharmacy chain of more than four hundred stores holding roughly a third of the organised market. Insurance, education, renewable energy. And a seventeen point eight per cent stake in Lion Finance Group, the listed bank, which anchors the valuation of everything else because it is the one holding with an observable price.

It describes itself as a permanent-capital business-building platform, and the phrase earns its length. A closed-end private equity fund has to sell things on a schedule. A passive conglomerate simply holds them. This does neither. It builds businesses in essential-service sectors, targeting ones capable of reaching real scale within three to five years, and it can hold them for as long as that takes.

These are not early-stage bets. The healthcare business grew revenue around twenty per cent with earnings up considerably more, while cutting its borrowing. The pharmacy chain converts over ninety per cent of its earnings into cash. And the group has shifted from expansionary investment to disciplined capital return, reducing commitments as the portfolio matured and buying back its own shares.

It carries a persistent discount to its own independently assessed asset value, and the piece argues that the discount is structural rather than a verdict on the businesses. Legacy regional-risk perception. Frontier-market classification. Liquidity limits for institutions. Value created locally while the price is discovered offshore. And the ordinary complexity of a multi-asset holding company. That combination is a pricing inefficiency rather than a business-quality concern, and the two are worth telling apart.

Re-rating comes from evidence of value being realised, not from anybody telling the story better. Partial exits at or above carrying value. Continued buying back of shares. And the steady conversion of portfolio cash into group cash.

Worth stating plainly, because a holding company carries a particular set. Everything sits in one economy, so a shock reaches every holding at once rather than one of them. The private businesses are valued periodically rather than continuously, which means the asset value this whole argument rests on is an assessment and not a price. Currency translation moves a sterling shareholder's return regardless of how the businesses themselves do. Geopolitical sentiment moves the shares more than operations do. And the liquidity is thin.

Which is why the piece concedes something the note would be weaker without: those factors justify some discount. The argument is about how much, not whether. A holding company that values its own private assets, in one currency, with limited liquidity, is genuinely harder to price than a listed operating business, and a market that insists on being paid for that difficulty is not being irrational. The open question is the size of the gap, not its existence.

Strip out everything else and this is a portfolio of Georgian businesses the market has never had to price directly, held by a company trading below what those businesses are appraised at. The risks above are real and worth holding in mind. Stating them plainly is not a hedge against any of that.

Two things to declare, and they point the same way. The author owns shares in Georgia Capital and may buy more or sell them without saying so, and he thinks well of it. He has also been a customer of several of the businesses in the portfolio, which is how he came to look at the company at all.

The full piece on Georgia Capital is on the site. Free, no email address, no paywall, at the conviction play dot com.

A note before we finish. This episode is narrated by a synthetic voice, not by the author. It is an assessment of business quality, not a view on the share price: nothing here is a valuation, a price target, or a recommendation to buy or sell anything. A company can sit outside one of our frameworks and still be a fine business and a fine investment, and we publish those too, with the reason, because an assessment that only speaks about its winners is marketing. The Conviction Play publishes general commentary for information only. It is not investment advice, and capital is at risk. This reflects what was known on the day it was recorded.

That was Georgia Capital, from The Conviction Play. Thank you for listening.