Hatton National Bank crossigns @ Rs 300 mark: Colombo Stocks at its best now

                   DAILY MARKET REVIEW


 

• Market is not overheated for foreigners - Net foreign buying for the second consecutive day for this week.

• Net foreign buying  exceeds Rs 2.5b.n for the past couple of days. (Which includes the last two weeks figures as well.)

•  Investors chased Hotel sector shares for future potential.

21 /07/2010 (S.L.S.Picks) – Colombo Stock Exchange closed with positive gains today for the third consecutive day for this week.  The Milanka price index crosses 5500 mark for the first time in the history of Colombo Stock Exchange. There were renewed buying interests for selected stocks as investors are expecting better results for the June quarter 2010 from these companies.

All share price index was up by 51.14 points to close at 4857.57 & more liquid Milanka index was up by 42.05 points to close at 5503.28

The future potential of Colombo Stock Exchange was addressed by us under the special coverage “All Share Price Index - History performances & way forward “on 13th July 2010,  predicting the upward movement of the market. This has become a reality now & we expect market to reach 5000 barrier level well before end of the year 2010.
Turnover for the day was a healthy Rs3.9b.n  There were 4.45m.n shares of HNB changed hands @Rs 300 was one of major contributors for the  today’s high turnover.

Foreigners were active in today’s trading session & were net buyers for the second consecutive day for the week. Net foreign buying for the past two consecutive days in this week & the last two weeks clearly reflects the future growth potential of the Colombo Stock Exchange.

Net foreign inflow for the day was Rs 263m.n. foreign purchases were at Rs 1.8b.n. & foreign sales were at Rs 1.5b.n

Renewed buying interest was visible in Hotel sector shares due to the increased tourist arrivals to the country & the Banking sector companies as well.

Banking sector, Hotels sector & Construction sector has been identified as leading growth sectors in post war Sri lanka.

Services sector was heading the growth sector’s list due to share price appreciation of John Keels PLC which carries a 01 for 01 share split, followed by Motors sector. IT sector was heading the negative performers list for the day.

There were 113 gainers as against 45 negative performing counters.

ANNOUNCEMENTS

• Durdends Hospital (CHL) announced a share split of 01 shares for every 05 shares held

 
CLOSER LOOK

• The quarterly results of the listed companies in the Colombo Stock Exchange for the MARCH – JUNE Quarter 2010 will be released to the market within couple of weeks time. The results released for JAN – MARCH 2010 quarter showed improved performances & earnings for this period has risen more than 150%. We expect better results from the listed companies for the JUNE 2010 quarter as well.

• Foreigners were net buyers for the second consecutive day today. Net foreign buying for the last two days was Rs 572m.n. Foreign participation was at  high levels during the last two weeks.The Net foreign buying for the last two weeks tops Rs 2.1b.n.This is a positive sign for the Colombo Market as investors are waiting to see continuous foreign buying in CSE.

• Buying for JKH the at improved price levels always gives the signal of an upward market potential. JKH was closed at Rs 227.00 today & was up by Rs 2.75 for the day. JKH share has continuous buying interest during the last two weeks onward at higher price levels.

• The credit guarantee scheme approved by the Central Bank of Sri lanka to strengthen the liquidity position of the registered finance companies may give the confident to investors to invest in companies like The Finance Company, Nation Lanka Finance (Formerly Ceylinco Securities & Financials) etc. Investors are expecting a reduction of vat from Banks in future ,there for we expect Banks to perform well in the future.

• There were 09 crossings of HNB took place @ Rs 300 /share. Together with a 2.0m.n transaction of Chevron @ Rs 165 / share .

• Hotel sector shares such as Reef, Marawila & Keels Hotels traded in large quantities

STOCKS TO WATCH

• Sampath Bank

Has reported exceptional performance for the 1Q 2010 ended 31/03/2010 by registering a profit of Rs 598m.n as against 397m.n reported for the same period in year 2009.This reflects a profit growth of 50.6% YOY. Earnings per share (EPS) for the period was Rs 7.09 as at 311/03/2010 & it was Rs 5.24 for the same period in year 2009.

NAV of Sampath share as at 31/03/2010 was Rs 174.33. Sampath trailing PE ratio is below 12 & is one of lowest among listed banks.

Sampath Bank has a pending subdivision of 2 shares for every single shares held.

• National Development Bank

• Light House Hotel

• Overseas Reality

• Dunamis Capital

• Ceylon Grain Elevators

• Sierra Cables (Pending dividend of 0.20 cents.)

• Marawila Hotel

data - www.cse.lk