SRI LANKA - IT'S PLANTATION TIME NOW AT COLOMBO STOCK EXCHANGE

SECTOR           -     PLANTATIONS

SECTOR P.E.    -    12.50

MARKET P.E.   -    17.75

Plantation companies in the Colombo Stock Exchange are mostly undervalued at present. Specially if you take past couple of months, Plantation companies as a Sector substantially  under performed to the Overall market.

WHY PLANTATION SECTOR IS NOT ATTRACTIVE ?

• High Cost of Sales [ Labour cost,Fertilizer cost. etc]
• Volatility in Commodity prices in the market.
• Unpredictable weather conditions.

 WHY PLANTATIONS ARE ATTRACTIVE NOW?

• Increasing Oil prices in the world market paved the way to increase the demand for Natural Rubber Products & Palm Oil products.
• Commodity prices are on the rebound presently.
• Most of Plantation companies are diversified.
• Sector which is substantially under performed to the market.
• Most of other sectors in the Colombo Stock Market are over heated now.
• Best strategy is to move away from heated speculative counters & to invest in plantations.
• Most of the share prices of other companies in the Colombo Stock Market are @ their highest levels reported for the past 5 to 7 years. But not the Plantations.

There are 18 plantation companies listed in Colombo Stock Market up to now.

Main income generating crops are

• Tea
• Rubber
• 0il palm

Apart from these core income generating sectors, many of listed plantation companies have diversified their business interest to the following areas as well.
 * Hydro power   * Tourism   * Forestry   *Investments   *Other cultivations  [Coconut, Perennial crops etc.]

 Note - * December Companies +
            * Profits including all other details of  HORANA & WATAWALA  Plantations were as at  31/12/09

BEST BETS IN THE MARKET

• Balangoda Plantation                                                                             
• Malwatte Plantation 
• Watawala Plantation
• Kotagala Plantation
• Namunukula
• Kegalle
• Kelani Valley
• Agalawatte
• Hapugastanne
• Maskeliya