Global depositary receipts (GDRs) in Uzbekistan's National Investment Fund (UzNIF) rose to nearly $33 – more than 32% above their $25 market debut price – on the London Stock Exchange (LSE) on June 3 after Fitch Ratings revised its sovereign rating outlook on the Central Asian country from stable to positive.

According to Uzbek media outlets Spot and Daryo, the rally accelerated shortly after Fitch announced its decision. The rating firm also affirmed its BB rating on Uzbekistan.

A positive outlook indicates the possibility of a sovereign rating upgrade from Fitch in the medium term if current economic trends continue. Uzbekistan has previously stated its goal of achieving an investment-grade BBB rating by 2030.

UzNIF completed a dual listing on the Tashkent and London stock exchanges on May 13 in one of the largest transactions in Uzbekistan's capital market history. The initial public offering (IPO) raised approximately $692mn.

On the domestic market, shares were offered on the Tashkent stock exchange at UZS 4,650 each, with retail investors receiving a 5% discount. The stock was on June 4 trading between UZS 5,500 and UZS 5,650, around 18-21% above the offering price.

The strong performance of both the London-listed GDRs and the domestic shares suggests investors are increasingly willing to back Uzbekistan's economic reform programme, which has included privatisations, efforts to strengthen public finances and measures aimed at improving the investment climate.

In a commentary accompanying the outlook upgrade, Fitch said: “The 'BB' rating continues to reflect Uzbekistan's low government debt-to-GDP, sizeable external buffers and high potential growth, which is balanced by its still relatively low GDP per capita, high commodity dependence, and still high inflation.”

It added: “The authorities' broad-based reform agenda continues to advance, centred on enhancing market-efficiency through privatisations, improving monetary policy transmission, and improving fiscal management and transparency.”