Tuesday, December 9, 2014

Tuesday Markets- තවත් මන්දගාමි දිනක් නිමයි

(www.randora.lk-09/12/14) - දේශපාලන අස්ථාවර බව,උත්සව සමය ආදි කාරණා හේතු කර කොළඹ කොටස් වෙළෙඳ පොළ කෙරෙහි මේ දිනවල දැඩ් මන්දගාම් උනන්දුවක් තවදුරටත් පවතින බව තැරැවිකාර වාර්තා කියයි. කෙසේවෙතත්,සමාගම් වල ඉපයුම් වාර්තා හොද නිසා මෙය මිලදි ගැනිමට සුදුසු කාලයක් බවද ඔවුන් කියයි. මෙම තත්ත්වයන් මැද CTC,SHAL,SLTL,CTHR,NEST යන සමාගම් වල මිළ පහළ යාම හමුවේ දිනයේ අවසන සියළු කොටස් මිළ දර්ශකයේ අගය ඒකක 23.53 කින් පහළ යමින් ඒකක 7,217.94 වු අතරේ S&P SL 20 දර්ශකය අද ඒකක 4.38 කින් ඉහළ යමින් ඒකක 4,063.70 ක් විය. දිනයේ පිරිවැටුම රුපියල් මිලියන 790 ක් විය. ජෝන් කීල්ස්,කොමාර්ෂල් බැංකු හා චෙව්රොන් ලූබිරිකන් හි ගිවිසගත් ගනු-දෙනු වාර්තා විය. මේ අනුව දිනයේ පිරිවැටුමට වැඩ්ම දායකත්වය රුපියල් මිලියන 271 කින් දායක විය. සියෙරා කේබල්ස් හා චෙව්රොන් ලූබිරිකන් පසුගිය සති 52 ක ඉහළම මිළ වාර්තා කළේය.

Monday, July 1, 2013

Is the market experiencing a PULLBACK or is this the end of the up-trend?

By Stefan Juriansz - Markets Never Lie (Pvt) Ltd

Ever since the beginning of time Investment professionals have been trying to answer the questionduring periods of uncertainty ‘Are we in a PULLBACK or is this the end of the up-trend?’ It is a question that I ask my self today in the Sri Lankan equity market.

Before we dig into some analysis, I want investors to know that there is only one certainty in the market and that is uncertainty. The more a trader accepts the fact that you can’t predict markets and more so that you don’t need to know the future to be profitable,the better your trading will become.

State of the market

The Sri Lankan equity markets are only UP 8.5% year to date (YTD) with the help of several heavy weights such as JKH, COMB and LLUB etc.;have all benefitted frompositiveinflows. However the current 6% pull back we are currently facing has been a cause for concern especially given the fact that we have witnessed an outflow of LKR 1 billion over the last few days. As foreign activity has contributed vastly towards the total turnover this year we should pay attention to these flows going forward.

The key technical levels for the All Share Price Index (ASPI) are between 5900 and 6300.In the coming month I will be taking a step back and observing howthe S&P SL20 heavy weights and the ASPI, trade around the levels mentioned.Over the last year previous consolidations in the market have lasted an average of 3 months and have witnessed a maximum drawdown of 10%. Therefore there is a possibility that the present situation could also last for a similar period of time and we would only get some much needed clarity on the markets by August. A 10% pull back could take us down towards 5900, which is a key support level for the index. However if we break below this level I would have to reevaluate the market and my portfolio.

S&P SL 20 analysis…

Part of my analysis includes observing the key support levels of each of the stocks on the table provided below and as long as the stocks can hold above these key support levels I would stay moderately bullish on this market while it takes time to decide on the direction. Furthermore, I would also want to see if the counters that performed the best YTD continue to stay strong or if we will witness some mean reversion in the market. (Mean reversion is when the original leaders of the market start to pullback and stagnate and the laggards start to see improvement by playing catch up to the original leaders).Remember I am not trying to predict what will happen but I will respond to the changes in conditions. Ultimately price pays and do not let anyone tell you otherwise. The market will tell me if I am right or wrong but right now it’s telling me to take some time off and move to the sidelines.

"Every once in a while you must go to cash, take a break, take a vacation. Don’t try to play the market all the time. It can’t be done"- Jessie Livermore

Markets Never Lie (Pvt) Ltd is a private trading consultancy which manages discretionary portfolios and provides advice to investors on local and global markets. The founder, Stefan Juriansz partners with the Island and Investors.lk to help provide investors with unbiased advice and encourages investors to contact him regarding their investments. Email:Stefan@marketsneverlie.com

source - www.island.lk

Thursday, June 27, 2013

Sri Lanka stocks close up 0.6-pct

June 27, 2013 (LBO) - Sri Lanka's stocks closed up 0.64 percent on Thursday, with the heavy index stocks showing gains, ending a week of losses, brokers said.

The benchmark Colombo All Share Index closed 38.68 points higher at 6,111.36 and the S&P SL 20 Index closed 12.85 points higher at 3,426.48 up 0.38 percent.

Turnover was 1.3 billion rupees up from 2.2 million a day earlier.

Foreigners brought 450 million rupees worth shares while selling 947 million rupees in a day that 131 stocks advanced and 47 stocks declined.

Ceylon Tobacco Company contributed most to the index closing at 989.50 rupees up 9.70 rupees, John Keells Holdings gained 2.00 rupees to close at 251.80 rupees with over 2.6 million shares traded. Dialog Axiata gained 20 cents to close at 8.60 rupees.

Negative contributors included The Bukit Darah losing 13.40 rupees to close at 695.60 rupees, Ceylon Cold stores lost 7.70 rupees to close at 162.00 rupees.

Hatton National Bank closed at 161.20 rupees up 1.80 rupees and Sampath Bank closed at 204.70 down 0.30 rupees.

Nestle Lanka lost 9.30 rupees to close at 1940.50 cents and Distilleries Company closed at 194.70 rupees up 4.70 rupees and Aitken Spence closed at 130.00 rupees down 0.20 rupees.

source - www.lbo.lk

Monetary Policy: Impact of SRR Reduction

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source - acuity research

LOLC ties up with world giant BRAC to buy control of Nanda Investments

BRAC, one of the world’s largest micro financing providers, entered into a ground breaking strategic alliance with LOLC, one of the largest conglomerates whose core business is financial services, to acquire the controlling interest of Nanda Investments and Finance PLC (Nanda Investments).

 This transaction will transfer 90,645,057 shares with a 56.6% stake of Nanda Investments to BRAC with LOLC taking a stake of 33.4%. LOLC is expected to make this equity investment through its fully owned subsidiary, LOLC Micro Investments Ltd.

Nanda Investments yesterday saw 91.2 million of its shares traded between a high of Rs. 9 and a low of Rs. 8.40 before closing at Rs. 8.60, up by 10 cents. The BRAC-LOLC buying was at Rs. 9 per share in a deal worth Rs. 815.8 million. Strike price is above the Net Assets Value per share of Rs. 5.29 as at 31 March 2013.

 Nanda Investments is a registered finance company listed on the Colombo Stock Exchange with a lending portfolio of Rs. 290 million and a fixed deposit base of Rs. 88 million. The total assets of the company as at 31 March 2013 were Rs. 663 million.

 BRAC is the largest development organisation in the world in terms of the scale and breadth of its operations and was founded 10 years ago in Bangladesh by its Chairman, Fazle Hasan Ahbed.

 He is one of the ‘Global Greats’ in the social sector and for his outstanding contribution to social improvement, he has received the Ramon Magsaysay Award, the UNDP Mahbub Ul Haq Award, the inaugural Clinton Global Citizen Award and the inaugural WISE Prize for Education.

BRAC reaches out to the less privileged communities across the globe through microfinance, education, healthcare, legal services, community empowerment and more, catalysing lasting change and creating an ecosystem in which the less privileged have the chance to seize control of their own lives. Through this initiative, BRAC has reached and touched the lives of an estimated 126 million people, spanning across 11 countries in Asia and Africa and the Caribbean.

 BRAC, with its 100,000 employees dedicated to spreading antipoverty in the world, focuses on social and financial empowerment of women, healthcare and education, empowering farmers though inclusive financial solutions, not only catering to financial needs, but also improving livelihood and financial literacy among the less privileged.

 LOLC Group is one of the largest non-banking financial institutions in Sri Lanka formed in 1980 and pioneered leasing in the country. Within the open economy, the company revolutionised SME financing of income generating. This initiative changed millions of lives of the SME sector and many of them over the last three decades have graduated to the level of medium to large scale enterprises.

 With this objective achieved, LOLC moved on with its next objective of reaching the non-bankable micro sector to facilitate financing to empower the micro sector with financial solutions that not only provided the much needed seed capital but to be a partner with interests in sustainable improvement of the livelihood of this community.

 LOLC Micro Credit Ltd. (LOMC) was formed with this intention in 2009 along with FMO (The Netherlands Development Finance Company) who has a stake of 20% in the company. LOMC today is one of the largest micro financing institutions in the country, serving more than 160,000 customers and is reaching the poorest of the rural community through its 128 service outlets.

 In the medium term, it is expected that BRAC and LOLC will invite Triodos Bank to invest in a stake of 10% and the new shareholder is expected to spearhead the provision of micro funding to fuel portfolio growth.

 Triodos Bank is one of the world’s leading sustainable banks formed 30 years ago with the mission of making money work for positive social, environmental and cultural change and transacts only with sustainable companies. The bank has transactions with more than 355,000 customers with 6.8 billion euros under its management. The bank provides financial support for more than 6,000 sustainable enterprises in 40 countries worldwide.

 Nanda Investments was founded in 1961 by Sirisena Mallawarachchi and in 1990, Anura Mallawarachchi took over the management of the company as the Chairman. Later, he stepped down and managed the company as Managing Director in line with Central Bank guidelines.

 BRAC together with LOLC makes a formidable partnership in acquiring Nanda Investments which is expected to be positioned as a micro finance company to reach the rural community with whom both shareholders are familiar names for sustainable financial solutions.

 BRAC will extend its current business model together with the backing of its global business operations platform while LOLC will play a key role in providing the know-how on the local micro credit business. Together with Triodos Bank, this partnership will flourish as a strong microfinance company with a sustainable business model of providing financing to less privileged rural community.

source - www.ft.lk

Daily Market Review - Foreign Buying Up date

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source - acuity research

Tuesday, June 25, 2013

Daily market update and Foreign Holding up date - 24 06 2013

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source - acuity research

Monday, June 24, 2013

NDBS tips stock market upturn to persist

NDB Stockbrokers is forecasting the upturn in the stock market to persist aided by lower interest rates and improved corporate earnings.

“The ASPI has gained 28% since our review in May 2012. However, the rise in stock prices of 13% in 2013 (by end of May) is slightly ahead of our expectations. Accordingly we expect a lower rate of appreciation of stock prices in 2013H2 compared to 2013H1. We remain optimistic regarding the prospects in the equity market in 2014 on the premise the interest rates would ease resulting in improved corporate profitability and attraction of investors to equities (from fixed income investments). Therefore, we maintain the bull-run would continue in 2014 to reach our ASPI target of 9,000,” NDBS said in its latest Sri Lanka Equities report.

“We expect a modest increase in profits of 10% to 15% for 2013. With the pickup in economic activity and lower interest rates we expect a robust growth in profits of 20% in 2014. According to our estimates, the broad market is currently trading at a forward P/E of 12x based on 2013 expected earnings. We feel it is attractively priced compared to the regional equity markets considering the optimism and growth expectations in Sri Lanka over the next two to three years,” NDBS said. It also said as expected the market interest rates have come down in most commercial banks by 100 to 200 basis points in May 2013.

“We expect the private sector credit growth to be lower at 15% in 2013 compared to 18% in 2012. The anticipated reduction in the losses made by state owned enterprises (SOEs) and the attempt to reduce budget deficit may contain the demand for credit from Government entities. However, due to the high debt service obligations in 2013 we expect robust Government borrowing,” the company said.

“Accordingly, we do not foresee further significant reductions in interest rates in the short term. Since the government debt service obligations are comparatively less in 2014 further reductions in interest rates could be expected by early 2014 (or late 2013),” NDBS added.

 Noting that global bond and equities runs may slow down, the broking firm said the interest rates in USA were maintained at historical lows since 2011 to revive the economy. Therefore, the interest rates were exceptionally low in most parts of the world. Interest rates have gained since May 2013 with the assumption that USA would scale down quantitative easing programs in view of the improving economic conditions (continuing the program eternally was not sustainable).

 The global equities which were on a run from 2012 slowed down significantly in May simultaneously. “We do not expect an increase in global interest rates to have a significant upward pressure on local interest rates since the domestic market interest rates are around 5% to 10% higher than global interest rates (and also because the capital account is not fully liberalised). Accordingly, only a steep rise in global interest rates would have an upward pressure on the domestic interest rates,” NDBS said.

source - www.ft.lk