Digital Banking Expansion Will Unlock Opportunities In Georgia And Uzbekistan

Key Takeaways

• Strong digital adoption and expansion into underbanked Central Asian markets drive long-term growth, diversified revenues, and higher margins.
  
• Macroeconomic stability and product innovation ensure earnings resilience while reducing dependence on traditional interest income and the Georgian market.
  
• Heightened regulatory, credit, investment, and compliance pressures across core markets threaten to constrain growth, compress margins, and amplify operational and concentration risks.

Catalysts

Through its subsidiaries, provides banking, leasing, insurance, brokerage, and card processing services to corporate and individual customers in Georgia, Azerbaijan, and Uzbekistan.

• The rapid adoption of digital banking and payments—demonstrated by strong growth in digital users, high digital issuance rates for loans and deposits, and robust digital product pipelines in Georgia and Uzbekistan—positions TBC Bank Group to achieve sustained increases in transaction volumes and fee-based income, supporting long-term revenue growth and margin expansion.
  
• Significant expansion in Uzbekistan, an underbanked market with fast GDP growth and rising smartphone penetration, is unlocking a large, untapped customer base and new revenue streams. This is reflected in doubling of operating income, surging user acquisition, and product diversification, which will drive future top-line growth and earnings.
  
• Structural shifts towards a digital-first operating model—evidenced by increasing digital engagement and efficient customer acquisition—allow TBC to improve operational efficiency and maintain strong cost-to-income ratios, supporting higher net margins over the long term.
  
• The growing middle class and solid economic growth in Georgia and Uzbekistan underpin strong loan and deposit growth, as well as increased demand for mortgages, consumer credit, and SME banking. This macroeconomic tailwind provides visibility for stable revenue and earnings growth.
  
• Diversification of income through new products (credit cards, MSME lending, installment loans, and value-added digital services), alongside an expanding addressable market in Central Asia, reduces reliance on traditional interest income and the Georgian market, enhancing earnings resilience and long-term profitability.

TBC Bank Group Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming TBC Bank Group's revenue will grow by 25.8% annually over the next 3 years.
• Analysts assume that profit margins will shrink from 48.3% today to 39.8% in 3 years time.
• Analysts expect earnings to reach GEL 2.1 billion (and earnings per share of GEL 35.96) by about May 2028, up from GEL 1.3 billion today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 6.6x on those 2028 earnings, down from 7.0x today. This future PE is lower than the current PE for the GB Banks industry at 8.2x.
• Analysts expect the number of shares outstanding to grow by 1.73% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 7.71%, as per the Simply Wall St company report.

TBC Bank Group Future Earnings Per Share Growth

Risks

• Recent regulatory changes in Uzbekistan introducing caps on micro loans, credit cards, and auto loans could constrain TBC Bank Group’s ability to maintain the rapid loan growth that has boosted its top-line expansion, potentially slowing future revenue growth as lending mix shifts.
  
• Rising cost of risk in Uzbekistan, now at 7–8% versus previous guidance of 6%, driven by expansion into higher-risk and thin-file/no-file customer segments as well as product innovation, introduces increased provisioning expenses and could erode net margins and long-term profitability if not compensated by pricing or improved risk management.
  
• The need for sustained heavy digital and product development investments in Uzbekistan (to build new segments like MSMEs, credit cards, and secured lending) keeps cost-to-income ratios elevated in the medium term, potentially offsetting operating income gains and putting pressure on earnings growth.
  
• Heavy dependence on the Georgian market for group profitability and returns (with Georgia’s operations providing the bulk of net profit and ROE) exposes TBC Bank Group to local economic and political risks, so any cyclical downturn or instability could significantly impact revenue stability and overall earnings.
  
• Increasing compliance demands, as reflected by recent fraud incidents and regulatory tightening (including AML and consumer credit rules), elevate operational complexity and require additional spending on controls and anti-fraud measures, potentially crimping margins and increasing reputational and regulatory risk.

Valuation

• The analysts have a consensus price target of GEL53.504 for TBC Bank Group based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of GEL63.56, and the most bearish reporting a price target of just GEL38.15.
  
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be GEL5.4 billion, earnings will come to GEL2.1 billion, and it would be trading on a PE ratio of 6.6x, assuming you use a discount rate of 7.7%.
  
• Given the current share price of GEL45.4, the analyst price target of GEL53.5 is 15.1% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.