* Offshore investors get in for first time in 12 sessions
* Investor woes on rising inflation hurt trading
* Rupee flat for sixth straight session
COLOMBO, March 31 (Reuters) - Sri Lanka's stock market rose on Thursday, ending three straight losses, as offshore investors entered the market to pick up shares in light volume amid inflation fears and sales to meet a regulatory deadline.
Government data showed March inflation year-on-year rose beyond forecasts to a 26-month high of 8.6 percent. [ID:nL3E7EV1KF]
The island's main share index closed 0.46 percent or 33.4 points firmer at 7,226.12. It had hit a record closing high of 7,811.82 on Feb 14.
Analysts said worries over inflation may hurt the market with a possible supply disruption due to ongoing turmoil in the oil-producing Middle East and North Africa. Oil rose over $1 on Thursday to $116.78 a barrel, heading for its biggest quarterly gain in almost 2 years. [ID:nL3E7EU0YK]
Sri Lanka's Securities and Exchange Commission has directed all stockbrokers to stop credit transactions by end-June, and cut their debtors' balances to 50 percent by Thursday. [ID:nSGE6AS0BD]
The day's turnover was at 2.2 billion Sri Lanka rupees ($19.9 million), less than last year's average of 2.4 billion rupees and well below this year's daily average is 3.2 billion rupees.
Foreign investors were net buyers of shares worth 692.4 million rupees on Thursday, the first time in 12 sessions. They have sold a net 7.1 billion in 2011, and a record 26.4 billion in 2010.
The bourse is still Asia's best performer in 2011 with an 8.9 percent gain, after bringing in the region's best return of 96 percent last year.
Traded volume was 62.1 million, against a five-day average of 63.9 million shares. The 30-day and 90-day average trading volumes were 63.7 million and 70 million, respectively. Last year's daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 15.1, one of the highest among emerging markets, compared with 12.5 in Asian markets and 11.8 for global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed firmer at 110.38/40 a dollar from Wednesday's close of 110.35/37 on importer dollar demand, dealers said.
FACTORS TO WATCH:
- Impact of the ongoing Middle East/North Africa turmoil on stocks and rupee
- Impact of rising inflation
- The extent of rupee appreciation the central bank will allow to curb imported inflation
source - in.reuters.com
Thursday, March 31, 2011
Sri Lanka shares close up 0.5-pct
Mar 31, 2011 (LBO) - Sri Lankan shares closed higher Thursday with interest in the banking and finance sector and Union Bank of Colombo the most actively traded and closing stronger, brokers said.
The All Share Price Index closed at 7,226.12, up 0.46 percent (33.40 points) while the more liquid Milanka index rose 0.92 percent (62.96 points) to close at 6,874.74, according to stock exchange provisional figures.
Turnover was 2.19 billion rupees.
Union Bank of Colombo, which debuted Tuesday, was again the most actively traded stock, with 2.5 million shares changing hands. It closed at 35.80 rupees, up 10 cents.
Guardian Capital Partners was also heavily traded, closing at 290.60 rupees, up 26.40, and Ceylon Grain Elevators, which closed at 168.10, down 2.90 rupees.
There were five crossings or private deals of Sampath Bank of 2,140,000 shares at 290 rupees each. The stock closed at 288.30 rupees, up 2.10.
Central Finance ended at 1,273.70 rupees, up 69.70.
source - www.lbo.lk
The All Share Price Index closed at 7,226.12, up 0.46 percent (33.40 points) while the more liquid Milanka index rose 0.92 percent (62.96 points) to close at 6,874.74, according to stock exchange provisional figures.
Turnover was 2.19 billion rupees.
Union Bank of Colombo, which debuted Tuesday, was again the most actively traded stock, with 2.5 million shares changing hands. It closed at 35.80 rupees, up 10 cents.
Guardian Capital Partners was also heavily traded, closing at 290.60 rupees, up 26.40, and Ceylon Grain Elevators, which closed at 168.10, down 2.90 rupees.
There were five crossings or private deals of Sampath Bank of 2,140,000 shares at 290 rupees each. The stock closed at 288.30 rupees, up 2.10.
Central Finance ended at 1,273.70 rupees, up 69.70.
source - www.lbo.lk
Sri Lanka economy grows 8.6-pct in 4Q
Mar 31, 2011 (LBO) - Sri Lanka's economy grew 8.6 percent in the fourth quarter of 2010, up from 6.1 percent a year earlier and also higher than the 8.0 percent estimated for the third quarter, the government's statistics office said.
The office said the economy grew 8.0 percent during the full year 2010.
In the fourth quarter the gross domestic product deflator, a broad measure of inflation rose 7.8 percent in the quarter, from a year earlier.
Agriculture
Agriculture grew 6.3 percent from 5.5 percent a year earlier. Tea had fallen 1.0 percent withy low country output falling. Value addition in rubber has grown 15.1 percent with strong prices helping.
Coconut fell 13.3 percent with low rainfall and outbreak of diseases. Paddy sector grew 31.8 percent. Gross extent sown increased 21.4 percent and harvested increased 23.5 percent in the 'Yala' minor cultivation season.
Livestock had grown 3.7 percent helped by the end of the war in east and border areas. Fishing had grown 12.1 percent with inland fishing up 13.5 percent and marine fishing up 11.8 percent.
Industry
Value added in industry grew 8.9 percent up from 7.3 percent a year earlier. The statistics office said manufacturing grew 8.2 percent and mining and quarrying 15.8 percent.
Factory industry had grown 8.8 percent helped by chemicals, petroleum, rubber and plastic.
Electricity, gas and water grew 8.3 percent, up from 5.4 percent a year earlier. Construction grew 8.0 percent.
Services
Services, which is the largest part of the economy, grew 8.8 percent, up from 5.6 percent a year earlier.
Hotels and restaurants grew 41 percent, transport and telecommunications 11.9 percent, banking, insurance and real estate 7.9 percent and wholesale and retail trade by 8.4 percent.
Export trade sector grew 12 percent and the import trade grew 8.3 percent.
source - www.lbo.lk
The office said the economy grew 8.0 percent during the full year 2010.
In the fourth quarter the gross domestic product deflator, a broad measure of inflation rose 7.8 percent in the quarter, from a year earlier.
Agriculture
Agriculture grew 6.3 percent from 5.5 percent a year earlier. Tea had fallen 1.0 percent withy low country output falling. Value addition in rubber has grown 15.1 percent with strong prices helping.
Coconut fell 13.3 percent with low rainfall and outbreak of diseases. Paddy sector grew 31.8 percent. Gross extent sown increased 21.4 percent and harvested increased 23.5 percent in the 'Yala' minor cultivation season.
Livestock had grown 3.7 percent helped by the end of the war in east and border areas. Fishing had grown 12.1 percent with inland fishing up 13.5 percent and marine fishing up 11.8 percent.
Industry
Value added in industry grew 8.9 percent up from 7.3 percent a year earlier. The statistics office said manufacturing grew 8.2 percent and mining and quarrying 15.8 percent.
Factory industry had grown 8.8 percent helped by chemicals, petroleum, rubber and plastic.
Electricity, gas and water grew 8.3 percent, up from 5.4 percent a year earlier. Construction grew 8.0 percent.
Services
Services, which is the largest part of the economy, grew 8.8 percent, up from 5.6 percent a year earlier.
Hotels and restaurants grew 41 percent, transport and telecommunications 11.9 percent, banking, insurance and real estate 7.9 percent and wholesale and retail trade by 8.4 percent.
Export trade sector grew 12 percent and the import trade grew 8.3 percent.
source - www.lbo.lk
SL records 2nd best post-independence GDP growth
The economic output of Sri Lanka as measured by GDP for the year 2010 at constant (2002) prices is estimated at Rs. billion 2,645.4 as against Rs. billion 2,449.2 in the previous year, registering an 8.0 percent growth rate as against 3.5 percent growth in the previous year. This impressive high growth is more important for the country’s economic progress, and it is the second best GDP growth ever achieved since independence. The highest ever achieved GDP growth in the history of the country was 8.2 percent, and it was recorded in the years of 1968 and 1978.
The three major sectors of the economy namely, Agriculture, Industry, and Services registered significant growth as 7, 8.4 and 8.0 percent respectively in 2010 over the previous year. Of these, Industry and Services sectors grew in a unprecedented way, making the highest ever growth since 2002. The sub sectors which registered relative significant growth among the major sectors in the reference year are “Tea” 13.1 percent, “Rubber” 12.7 percent, “Minor Export Crops” 37.6 percent, “Paddy” 17.5 percent, “Fishing” 12.2 percent, “Mining and Quarrying” 15.5 percent, “Construction” 9.3 percent , “Electricity Gas & Water” 7.8 percent, , “Wholesale & retail trade” 7.5 percent, “Hotels & restaurant” 39.8 percent, “Transport & communication” 11.9 percent, and “Banking, Insurance, & Real estate” 7.5 percent.
Drop in Coconut sub sector
However, the growth of Coconut sub sector dropped by (-) 14.3 percent in 2010 as against the previous year. The “Livestock production”, “Other Food crops(Highland crops, Vegetables, and Fruits)” , “Firewood & Forestry”, and “Gas”, in 2010 have recorded relatively slow growth constituting 2.9 percent,4.4 percent, 3.1 percent, and 4.6 percent, as against the previous year.
The percentage share of the three major sectors, namely the Agriculture, Industry,and Services to the total GDP constituted 11.9 percent, 28.8 percent and 59.3 percent respectively.
Inflation up
The year on year (YOY) inflation as measured by Colombo Consumers’ Price Index is recorded as 5.9 percent in 2010 whereas it was 3.4 percent in 2009. The index number of GDP implicit price deflator rose to 211.8 in 2010, from 197.4 in 2009 registering inflation rate as 7.3 percent for the year 2010.
The GDP per-capita (“Per-capita income”- based on the GDP) at market prices is estimated at Rs.271, 259 (US$ 2,399) in 2010 as against Rs.236, 445(US$ 2,057)
for the previous year depicting a growth of 14.7 percent for the Rupee value and 16.6 percent for the US$ value. Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs. billion 3,684.7 in 2010 as against Rs. billion 3,116.2 in 2009. Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs. billion 1,452.0 in
2010 as against Rs .billion 1, 147.4 in 2009. The corresponding share of GFCF to the GDP is 25.9 Percent in 2010 and 23.7 percent in 2009.
Gross Savings at current prices in 2010 is estimated at Rs. billion 1,360.1 as against Rs. billion 1,141.5 in 2009 constituting 24.3 percent of GDP as against 23.6 percent in the previous year. 4
Growth in Agriculture
The “Agriculture, forestry, and fishing” sector showed a 7.0 percent growth in 2010 as against the growth of 3.2 percent the year before.
The growth rate of Tea is registered as 13.1 percent for the year 2010 as against (-) 8.4 percent for the year 2009, attributed to the recovery in tea production which had been dropped in 2009. The favourable weather conditions during the period of January to September in 2010 also supported this growth. However, tea production decreased by 1.0 percent in Q4 2010 owing to unfavourable weather conditions.
The value added of Rubber production grew by 12.7 percent in 2010 as against the 7.9 percent for the last year. The major reasons for this growth was due to the increase in average price of Rubber (at Colombo auction) which rose to Rs 397.70 per Kg in 2010 from 201.66 per Kg in 2009 indicating 97.2 percent price increase.
This price increase enthused over the maintenance of rubber estates and tapping activities which eventually propped up the growth.
The value addition of Coconut production showed a 14.3 percent decrease in 2010, though it grew by 5.3 percent in the previous year. Low rainfall in 2009, onset of pest and outbreak of diseases and low humidity in major coconut cultivating areas were identified as root causes to such a decline.
Minor Export Crops
The growth rate of Minor Export Crops (MEC) was recorded as 37.6 percent in 2010 whereas it was 5.2 percent for the previous year. The export quantities of Cloves, Sesame seeds, Cashew nuts have increased by 206.6 percent, 438.8 percent, and 94.7 percent respectively in the reference year.
The paddy grew by 17.5 percent in 2010 as against the negative growth of 5.1 percent in 2009. The gross extent sown and gross extent harvested increased by 9.0 5 percent, and 12.5 percent respectively in 2010 over the previous year. The higher paddy prices, adequate water supply, resumption of cultivation in paddy fields -
especially in Northern and Eastern Provinces which had been forbidden cultivation for years by the war, and pro-agricultural policies such as fertilizer subsidy, guaranteed paddy prices etc. were the major driving forces for the growth of paddy production.
Growth in fishing & livestock
The sub sector of Livestock production grew by 2.9 percent in 2010. The restored peace across the country supported the growth of livestock farming, especially in the East, the North Central province were able to increase the livestock production.
The overall fishing industry grew by 12.2 percent in 2010. Of these “Inland fishing” grew by 10.1 percent and “Marine fishing” grew by 12.5 percent. The expansion of breeding fish distribution to tanks, the development programmes currently being operated for inland fishing in the North, better management practices in inland fishing industry, resumption of inland fishing industry in Mannar and Vavuniya districts supported the outstanding growth of inland fish production. The satisfactory growth of Marine fishing industry has been supported by the relaxation of restricted fishing time and fishing areas in the North, higher fish production in Northern and Eastern provinces, and the progress made in fishing industry related infrastructure facilities.
Industry sector
In real terms, value added of the industry sector grew by 8.4 percent in 2010 as against 4.2 percent growth in 2009. Manufacturing which is the largest sub sector of the industry sector grew by 7.3 percent in 2010.
The growth rate of Gem Mining recorded a 7.9 percent in 2010. The export quantities of both the precious stones and semi-precious stones, increased by 4.7 percent in the reference period.
The factory industry grew by 7.5 percent. The higher growth of factory industry has been supported by “Chemicals, Petroleum, rubber and plastic products” by 12.2 percent, “Non-metallic mineral products” by 10.4 percent, “Fabricated metal machinery and equipment” by 8.2 percent and “Textile, wearing apparel and leather products” by 5.2 percent.
The growth rate for the sub sector of “Electricity, Gas and Water” is 7.8 percent for the reference year as against 3.7 percent growth in 2009. The overall electricity generation grew by 8.4 percent during the reference year, while Hydro power generation recorded a 46.4 percent growth and the Thermal power generation recorded a (-) 16.4 percent growth.
In real terms, the construction sub sector indicated a 9.3 percent growth for the year 2010 and it was 5.6 percent for the previous year. This growth was supported by the introduction of new development projects, the large scale projects already in operation and the operated rehabilitation and resettlement programmes, especially in Northern and Eastern provinces.
The total cement production has increased to 3,749,005 MT. in 2010 from 3,212,865 MT. in 2009 indicating 16.7 percent increase. The disbursement of loan for constructions of houses, business premises, other buildings, and property developments increased by 39.6 percent during the reference year.
Service sector
The overall service sector marked 8.0 percent growth in 2010 as against 3.3 percent growth in the year 2009 making the highest ever growth in the annual series, since 2002.
The recorded high growth in the reference year has been boosted by the promising higher growth of its major sub sectors such as, “Hotels and Restaurants” by 39.8 percent, “Transport and Communication” by 11.9 percent, “Banking, Insurance and Real Estate” by 7.5 percent and “Wholesale and Retail Trade” by 7.5 percent.
The Export trade sector grew by 3.4 percent at constant prices for the year 2010.
According to the Balance of Payment (BOP) Statistics of the Central Bank of Sri Lanka (CBSL), exports earnings increased to Rs.Mn. 937,737 in 2010 from Rs.Mn. 813,911 in the year 2009, indicating 15.2 percent increase. According to trade indices of CBSL, export volume and export price level increased by 3.7 percent and by 11.1 percent respectively during the reference period.
Import trade sector
The Import trade sector grew by 9.5 percent in the reference period as against 8.2 percent drop in the previous year. Total expenditure for imports increased to Rs. Mn. 1,528,171 in 2010 from Rs. Mn. 1,172,618 in the year 2009 recording 30.3 increase. According to the trade indices of CBSL, the import volume and import prices increased by 11.6 percent and by 16.7 percent respectively in 2010 over the previous year. 8
Domestic trade sub sector grew by 7.6 percent in the year 2010. This was mainly due to the higher agricultural and industrial productions which mostly consume the domestic market. Higher production of paddy and fish which are mostly consumed locally, are the major driving forces to higher growth of domestic trade.
Hotels and Restaurants sector recorded 39.8 percent higher growth in 2010 as against the growth rate of 13.3 percent for the last year. Tourists’ arrival increased to 654,476 in 2010 from 447,890 in 2009 contributing a growth of 46.1 percent forthe reference year. Such a growth of tourists’ arrival has become cardinal to the tourists industry and it is the highest ever recorded number since 1969.
Growth wise, it is the second highest arrival rate reported since 1969.The major reason for these increments is the prevailed peace across the country. Tourists’ earnings increased by 62.0 percent and room occupancy rate increased to 70.1 in 2010 from 48.4 in 2009 .
Transport and Communication
Transport and Communication sector indicated 11.9 percent growth as against that of 6.3 percent growth in the previous year. The “Passenger and goods transportation”, “cargo handling” and “post and telecommunication” sub sectors grew by 11.4 percent, 16.8 percent and 13.2 percent respectively.
Total number of new registration of vehicles increased by 76.0 percent in the reference year as against 23.0 percent decline in the previous year. Registration of buses, three wheelers and goods transport vehicles increased by 237.1 percent 129.2 percent and 40.1 percent respectively in 2010. The boom of new registration of vehicles has been chiefly fueled by the reduction of import duty with effect from June 2010.
Both passenger income and passenger kilometers flown by Sri Lankan airline increased by 25.3 percent and 19.7 percent respectively in 2010.
Total telephone connections increased by 17.6 percent in this year due toexpansion of telecommunication services, especially in newly liberated areas ofNorthern Province and the introduction of new connections with advanced technology which attracted customers. The “Banking, Insurance and Real Estate sector” grew by 7.5 percent in 2010, as against the growth of 5.7 percent in the year 2009. Loans and advances increased rapidly in the year 2010, compared with previous year.
source - www.dailymirror.lk
The three major sectors of the economy namely, Agriculture, Industry, and Services registered significant growth as 7, 8.4 and 8.0 percent respectively in 2010 over the previous year. Of these, Industry and Services sectors grew in a unprecedented way, making the highest ever growth since 2002. The sub sectors which registered relative significant growth among the major sectors in the reference year are “Tea” 13.1 percent, “Rubber” 12.7 percent, “Minor Export Crops” 37.6 percent, “Paddy” 17.5 percent, “Fishing” 12.2 percent, “Mining and Quarrying” 15.5 percent, “Construction” 9.3 percent , “Electricity Gas & Water” 7.8 percent, , “Wholesale & retail trade” 7.5 percent, “Hotels & restaurant” 39.8 percent, “Transport & communication” 11.9 percent, and “Banking, Insurance, & Real estate” 7.5 percent.
Drop in Coconut sub sector
However, the growth of Coconut sub sector dropped by (-) 14.3 percent in 2010 as against the previous year. The “Livestock production”, “Other Food crops(Highland crops, Vegetables, and Fruits)” , “Firewood & Forestry”, and “Gas”, in 2010 have recorded relatively slow growth constituting 2.9 percent,4.4 percent, 3.1 percent, and 4.6 percent, as against the previous year.
The percentage share of the three major sectors, namely the Agriculture, Industry,and Services to the total GDP constituted 11.9 percent, 28.8 percent and 59.3 percent respectively.
Inflation up
The year on year (YOY) inflation as measured by Colombo Consumers’ Price Index is recorded as 5.9 percent in 2010 whereas it was 3.4 percent in 2009. The index number of GDP implicit price deflator rose to 211.8 in 2010, from 197.4 in 2009 registering inflation rate as 7.3 percent for the year 2010.
The GDP per-capita (“Per-capita income”- based on the GDP) at market prices is estimated at Rs.271, 259 (US$ 2,399) in 2010 as against Rs.236, 445(US$ 2,057)
for the previous year depicting a growth of 14.7 percent for the Rupee value and 16.6 percent for the US$ value. Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs. billion 3,684.7 in 2010 as against Rs. billion 3,116.2 in 2009. Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs. billion 1,452.0 in
2010 as against Rs .billion 1, 147.4 in 2009. The corresponding share of GFCF to the GDP is 25.9 Percent in 2010 and 23.7 percent in 2009.
Gross Savings at current prices in 2010 is estimated at Rs. billion 1,360.1 as against Rs. billion 1,141.5 in 2009 constituting 24.3 percent of GDP as against 23.6 percent in the previous year. 4
Growth in Agriculture
The “Agriculture, forestry, and fishing” sector showed a 7.0 percent growth in 2010 as against the growth of 3.2 percent the year before.
The growth rate of Tea is registered as 13.1 percent for the year 2010 as against (-) 8.4 percent for the year 2009, attributed to the recovery in tea production which had been dropped in 2009. The favourable weather conditions during the period of January to September in 2010 also supported this growth. However, tea production decreased by 1.0 percent in Q4 2010 owing to unfavourable weather conditions.
The value added of Rubber production grew by 12.7 percent in 2010 as against the 7.9 percent for the last year. The major reasons for this growth was due to the increase in average price of Rubber (at Colombo auction) which rose to Rs 397.70 per Kg in 2010 from 201.66 per Kg in 2009 indicating 97.2 percent price increase.
This price increase enthused over the maintenance of rubber estates and tapping activities which eventually propped up the growth.
The value addition of Coconut production showed a 14.3 percent decrease in 2010, though it grew by 5.3 percent in the previous year. Low rainfall in 2009, onset of pest and outbreak of diseases and low humidity in major coconut cultivating areas were identified as root causes to such a decline.
Minor Export Crops
The growth rate of Minor Export Crops (MEC) was recorded as 37.6 percent in 2010 whereas it was 5.2 percent for the previous year. The export quantities of Cloves, Sesame seeds, Cashew nuts have increased by 206.6 percent, 438.8 percent, and 94.7 percent respectively in the reference year.
The paddy grew by 17.5 percent in 2010 as against the negative growth of 5.1 percent in 2009. The gross extent sown and gross extent harvested increased by 9.0 5 percent, and 12.5 percent respectively in 2010 over the previous year. The higher paddy prices, adequate water supply, resumption of cultivation in paddy fields -
especially in Northern and Eastern Provinces which had been forbidden cultivation for years by the war, and pro-agricultural policies such as fertilizer subsidy, guaranteed paddy prices etc. were the major driving forces for the growth of paddy production.
Growth in fishing & livestock
The sub sector of Livestock production grew by 2.9 percent in 2010. The restored peace across the country supported the growth of livestock farming, especially in the East, the North Central province were able to increase the livestock production.
The overall fishing industry grew by 12.2 percent in 2010. Of these “Inland fishing” grew by 10.1 percent and “Marine fishing” grew by 12.5 percent. The expansion of breeding fish distribution to tanks, the development programmes currently being operated for inland fishing in the North, better management practices in inland fishing industry, resumption of inland fishing industry in Mannar and Vavuniya districts supported the outstanding growth of inland fish production. The satisfactory growth of Marine fishing industry has been supported by the relaxation of restricted fishing time and fishing areas in the North, higher fish production in Northern and Eastern provinces, and the progress made in fishing industry related infrastructure facilities.
Industry sector
In real terms, value added of the industry sector grew by 8.4 percent in 2010 as against 4.2 percent growth in 2009. Manufacturing which is the largest sub sector of the industry sector grew by 7.3 percent in 2010.
The growth rate of Gem Mining recorded a 7.9 percent in 2010. The export quantities of both the precious stones and semi-precious stones, increased by 4.7 percent in the reference period.
The factory industry grew by 7.5 percent. The higher growth of factory industry has been supported by “Chemicals, Petroleum, rubber and plastic products” by 12.2 percent, “Non-metallic mineral products” by 10.4 percent, “Fabricated metal machinery and equipment” by 8.2 percent and “Textile, wearing apparel and leather products” by 5.2 percent.
The growth rate for the sub sector of “Electricity, Gas and Water” is 7.8 percent for the reference year as against 3.7 percent growth in 2009. The overall electricity generation grew by 8.4 percent during the reference year, while Hydro power generation recorded a 46.4 percent growth and the Thermal power generation recorded a (-) 16.4 percent growth.
In real terms, the construction sub sector indicated a 9.3 percent growth for the year 2010 and it was 5.6 percent for the previous year. This growth was supported by the introduction of new development projects, the large scale projects already in operation and the operated rehabilitation and resettlement programmes, especially in Northern and Eastern provinces.
The total cement production has increased to 3,749,005 MT. in 2010 from 3,212,865 MT. in 2009 indicating 16.7 percent increase. The disbursement of loan for constructions of houses, business premises, other buildings, and property developments increased by 39.6 percent during the reference year.
Service sector
The overall service sector marked 8.0 percent growth in 2010 as against 3.3 percent growth in the year 2009 making the highest ever growth in the annual series, since 2002.
The recorded high growth in the reference year has been boosted by the promising higher growth of its major sub sectors such as, “Hotels and Restaurants” by 39.8 percent, “Transport and Communication” by 11.9 percent, “Banking, Insurance and Real Estate” by 7.5 percent and “Wholesale and Retail Trade” by 7.5 percent.
The Export trade sector grew by 3.4 percent at constant prices for the year 2010.
According to the Balance of Payment (BOP) Statistics of the Central Bank of Sri Lanka (CBSL), exports earnings increased to Rs.Mn. 937,737 in 2010 from Rs.Mn. 813,911 in the year 2009, indicating 15.2 percent increase. According to trade indices of CBSL, export volume and export price level increased by 3.7 percent and by 11.1 percent respectively during the reference period.
Import trade sector
The Import trade sector grew by 9.5 percent in the reference period as against 8.2 percent drop in the previous year. Total expenditure for imports increased to Rs. Mn. 1,528,171 in 2010 from Rs. Mn. 1,172,618 in the year 2009 recording 30.3 increase. According to the trade indices of CBSL, the import volume and import prices increased by 11.6 percent and by 16.7 percent respectively in 2010 over the previous year. 8
Domestic trade sub sector grew by 7.6 percent in the year 2010. This was mainly due to the higher agricultural and industrial productions which mostly consume the domestic market. Higher production of paddy and fish which are mostly consumed locally, are the major driving forces to higher growth of domestic trade.
Hotels and Restaurants sector recorded 39.8 percent higher growth in 2010 as against the growth rate of 13.3 percent for the last year. Tourists’ arrival increased to 654,476 in 2010 from 447,890 in 2009 contributing a growth of 46.1 percent forthe reference year. Such a growth of tourists’ arrival has become cardinal to the tourists industry and it is the highest ever recorded number since 1969.
Growth wise, it is the second highest arrival rate reported since 1969.The major reason for these increments is the prevailed peace across the country. Tourists’ earnings increased by 62.0 percent and room occupancy rate increased to 70.1 in 2010 from 48.4 in 2009 .
Transport and Communication
Transport and Communication sector indicated 11.9 percent growth as against that of 6.3 percent growth in the previous year. The “Passenger and goods transportation”, “cargo handling” and “post and telecommunication” sub sectors grew by 11.4 percent, 16.8 percent and 13.2 percent respectively.
Total number of new registration of vehicles increased by 76.0 percent in the reference year as against 23.0 percent decline in the previous year. Registration of buses, three wheelers and goods transport vehicles increased by 237.1 percent 129.2 percent and 40.1 percent respectively in 2010. The boom of new registration of vehicles has been chiefly fueled by the reduction of import duty with effect from June 2010.
Both passenger income and passenger kilometers flown by Sri Lankan airline increased by 25.3 percent and 19.7 percent respectively in 2010.
Total telephone connections increased by 17.6 percent in this year due toexpansion of telecommunication services, especially in newly liberated areas ofNorthern Province and the introduction of new connections with advanced technology which attracted customers. The “Banking, Insurance and Real Estate sector” grew by 7.5 percent in 2010, as against the growth of 5.7 percent in the year 2009. Loans and advances increased rapidly in the year 2010, compared with previous year.
source - www.dailymirror.lk
Sri Lankans to eat more chicken
By Jithendra Antonio
Sri Lanka’s current chicken consumption will increase to 8 kg per person from the current 5Kg next five years, Chairman of the Ceylon Grain Elevators (GRAN), Cheng Chih Kwong Primus said recently reviewing the company’s annual performance.
“With rapid development, change in lifestyle and purchasing power, we expect the consumption would increase in such a magnitude”. He pointed out that in the backdrop of market recovery from the global financial turmoil, the world population has grown anda will continue to grow in the next two decades.
“Meat consumption has a strong correlation with the GDP’s per capita income. With an increased purchasing power, consumption of meat and poultry products tends to go up in tandem. In 2010, the world GDP per capita income grew to US$ 5,611 pushing the consumptions to 38Kg per person and in 2030, the GDP per capita income is expected to reach US$ 7,600 where the consumption could reach as high as 45Kg per person, opening doors much wider for the poultry industry.”
Domestic per capita income has increased improving the purchasing power of Sri Lankans. This will result in the expenses on food purchases, making conditions highly favorable for the local poultry industry in general and GRAN in particular.
“The local market experienced a shortage in layer chicks and chicken meat supply during the first half of 2010, as a result of excess Day Old Chicks (DOC) supply in 2009. Breeder farms incurred huge losses and were forced to scale down their DOC production.”
“GRAN’s production cost was increased with maize shooting up from Rs. 34 per kg in March to Rs. 42 per kg in the 4th quarter last year. Thus the high production costs had to be passed down to the consumers eventually. GRAN purchased over 35,000 metric tones of local maize in 2010,” Kwong Primus pointed out.
source - www.dailymirror.lk
Sri Lanka’s current chicken consumption will increase to 8 kg per person from the current 5Kg next five years, Chairman of the Ceylon Grain Elevators (GRAN), Cheng Chih Kwong Primus said recently reviewing the company’s annual performance.
“With rapid development, change in lifestyle and purchasing power, we expect the consumption would increase in such a magnitude”. He pointed out that in the backdrop of market recovery from the global financial turmoil, the world population has grown anda will continue to grow in the next two decades.
“Meat consumption has a strong correlation with the GDP’s per capita income. With an increased purchasing power, consumption of meat and poultry products tends to go up in tandem. In 2010, the world GDP per capita income grew to US$ 5,611 pushing the consumptions to 38Kg per person and in 2030, the GDP per capita income is expected to reach US$ 7,600 where the consumption could reach as high as 45Kg per person, opening doors much wider for the poultry industry.”
Domestic per capita income has increased improving the purchasing power of Sri Lankans. This will result in the expenses on food purchases, making conditions highly favorable for the local poultry industry in general and GRAN in particular.
“The local market experienced a shortage in layer chicks and chicken meat supply during the first half of 2010, as a result of excess Day Old Chicks (DOC) supply in 2009. Breeder farms incurred huge losses and were forced to scale down their DOC production.”
“GRAN’s production cost was increased with maize shooting up from Rs. 34 per kg in March to Rs. 42 per kg in the 4th quarter last year. Thus the high production costs had to be passed down to the consumers eventually. GRAN purchased over 35,000 metric tones of local maize in 2010,” Kwong Primus pointed out.
source - www.dailymirror.lk
Influential govt official in Combank board
By Jithendra Antonio
State-owned funds once again showed muscle, pushing the appointment of a top government official to the director board of Sri Lanka’s largest private bank, Commercial Bank of (Ceylon) Plc.
According to an announcement by the Commercial Bank, Lakshman Hulugalle, Director General, Media Centre for National Security has been appointed to the director board of the bank effective yesterday, to fill a casual vacancy on the board. The announcement further said United Motors Chairman Ranjith Fernando decided to withdraw from the position of director, prior to considering his reelection by the shareholders at yesterday’s Annual General Meeting (AGM).
Meanwhile, Hulugalle’s appointment came to the limelight, a week after the appointment of President’s Banking Advisor, Dr. Ranee Jayamaha as the Chairperson of Hatton National Bank PLC, with EPF and state institutions increasing their shareholdings in the bank (over 25%) in the last quarter of 2010.
The announcement also said another board director, Dinesh Weerakoddy ceased to be a director with the adoption of a new Articles of Association at the Extraordinary General Meeting held yesterday,and was thereafter appointed to the board to fill another casual vacancy.
According to the director’s resume submitted by the Commercial Bank to the Colombo Stock Exchange as per the regulatory requirements, Hulugalle doesn’t possess any banking or financial background.
At present, nearly 20 percent of Commercial Bank’s shares are in the hands of government institutions, including Employee Provident Fund (EPF) and Sri Lanka Insurance Corporation (SLIC). As at December 31, EPF holds 4.7 percent of Commercial Bank while SLIC though its Life and General Funds holds 9.5 percent.
A day before the AGM, (Tuesday), EPF further increased its shareholding in Commercial Bank to over 9%, purchasing 4.4 million shares in three crossings at Rs.270, followed by Monday’s purchase of 430,000 shares at the same price.
Meanwhile, most analysts and economic experts question how ethical it would be for the government, through EPF and SLIC to take control of the entire commercial banking sector.
Government is the largest shareholder in Hatton National Bank owning nearly 21 percent through state-owned funds and banks. In Seylan Bank, the government indirectly holds nearly 30 percent while it owns 13 percent of Sampath Bank though EPF and SLIC. The government also indirectly holds over 31 percent in DFCC Bank.
source - www.dailymirror.lk
State-owned funds once again showed muscle, pushing the appointment of a top government official to the director board of Sri Lanka’s largest private bank, Commercial Bank of (Ceylon) Plc.
According to an announcement by the Commercial Bank, Lakshman Hulugalle, Director General, Media Centre for National Security has been appointed to the director board of the bank effective yesterday, to fill a casual vacancy on the board. The announcement further said United Motors Chairman Ranjith Fernando decided to withdraw from the position of director, prior to considering his reelection by the shareholders at yesterday’s Annual General Meeting (AGM).
Meanwhile, Hulugalle’s appointment came to the limelight, a week after the appointment of President’s Banking Advisor, Dr. Ranee Jayamaha as the Chairperson of Hatton National Bank PLC, with EPF and state institutions increasing their shareholdings in the bank (over 25%) in the last quarter of 2010.
The announcement also said another board director, Dinesh Weerakoddy ceased to be a director with the adoption of a new Articles of Association at the Extraordinary General Meeting held yesterday,and was thereafter appointed to the board to fill another casual vacancy.
According to the director’s resume submitted by the Commercial Bank to the Colombo Stock Exchange as per the regulatory requirements, Hulugalle doesn’t possess any banking or financial background.
At present, nearly 20 percent of Commercial Bank’s shares are in the hands of government institutions, including Employee Provident Fund (EPF) and Sri Lanka Insurance Corporation (SLIC). As at December 31, EPF holds 4.7 percent of Commercial Bank while SLIC though its Life and General Funds holds 9.5 percent.
A day before the AGM, (Tuesday), EPF further increased its shareholding in Commercial Bank to over 9%, purchasing 4.4 million shares in three crossings at Rs.270, followed by Monday’s purchase of 430,000 shares at the same price.
Meanwhile, most analysts and economic experts question how ethical it would be for the government, through EPF and SLIC to take control of the entire commercial banking sector.
Government is the largest shareholder in Hatton National Bank owning nearly 21 percent through state-owned funds and banks. In Seylan Bank, the government indirectly holds nearly 30 percent while it owns 13 percent of Sampath Bank though EPF and SLIC. The government also indirectly holds over 31 percent in DFCC Bank.
source - www.dailymirror.lk
Textured Jersey opts for Rs.1.7bn private placement
Textured Jersey Lanka Private Limited (TJL), the newest Initial Public Offering to hit the market, is expected to go for a pre-IPO private placement amounting to Rs.1.7 billion, Mirror Business learns.
It is also learnt that the company yesterday hosted a presentation for prospective investors to explain placement opportunities. TJL is a company jointly owned by Sri Lanka’s Brandix Group and Asia Pacific Textiles Holdings Limited, which is a listed entity in the Hong Kong Stock Exchange.
According to a disclosure made by the Asia Pacific Textiles Holdings Limited (which is the 60 percent owner of TJL through its 100 percent owned subsidiary of Pacific Textured Jersey Holdings Limited -PTJH) to the Hong Kong Stock Exchange, about 116 million shares of TJL will be given in placements, each share indicatively priced at Rs.15 or US$ 0.1376.
The Brandix Group is expected to give 33 million shares in the placement, while PTJH will offer 83 million. Following the private placement, the shareholdings of both Brandix and PTJH will dilute from 40 percent to 34.26 percent and from 60 percent to 45.57 percent, respectively.
According to the announcement, TJL has an issued share capital of Rs. 1,597,229,000 divided into 159,722,900 shares of Rs.10 each. It is expected that each Rs. 10 share of TJL will be sub-divided in a ratio of 5 into 18, so that there will be a total of 575,002,440 shares, in issue immediately after such sub-division.
The announcement further noted that under the IPO, TJL will issue 80 million new
shares to the Sri Lankan public, and the share price will be similar to the indicative placement price.
“Immediately after completion of the TJL IPO, the shareholdings of PTJH and Brandix will drop from 45.57% to 40.00% and 34.26% to 30.08% respectively”, the announcement noted.
After the listing of TJL in the main board of Colombo Stock Exchange, it is expected that Brandix and PTJH will arrive at an agreement not to dispose shares of TJL within two years upon listing.
The announcement also said that within three years after the said two-year period, if one of them disposes any of its TJL shares, the other party shall dispose that number of TJL shares resulting in both parties maintaining their shareholding (in relation to each other) in the same proportion as at the time of listing The collective shareholding shall not fall below 51% of the total issued shares of TJL during the three-year period.
The agreement will be further extended to jointly operate in relation to certain important matters, unless the other party has given its consent in writing to vote in favor of such
resolutions.
According to the announcement, TJL net profit for the financial year ended March 31 was Rs.144 million, while the net asset value as at September 30, 2010 was Rs.5.8 billion (US $ 53,635, 000).
source - www.dailymirror.lk
It is also learnt that the company yesterday hosted a presentation for prospective investors to explain placement opportunities. TJL is a company jointly owned by Sri Lanka’s Brandix Group and Asia Pacific Textiles Holdings Limited, which is a listed entity in the Hong Kong Stock Exchange.
According to a disclosure made by the Asia Pacific Textiles Holdings Limited (which is the 60 percent owner of TJL through its 100 percent owned subsidiary of Pacific Textured Jersey Holdings Limited -PTJH) to the Hong Kong Stock Exchange, about 116 million shares of TJL will be given in placements, each share indicatively priced at Rs.15 or US$ 0.1376.
The Brandix Group is expected to give 33 million shares in the placement, while PTJH will offer 83 million. Following the private placement, the shareholdings of both Brandix and PTJH will dilute from 40 percent to 34.26 percent and from 60 percent to 45.57 percent, respectively.
According to the announcement, TJL has an issued share capital of Rs. 1,597,229,000 divided into 159,722,900 shares of Rs.10 each. It is expected that each Rs. 10 share of TJL will be sub-divided in a ratio of 5 into 18, so that there will be a total of 575,002,440 shares, in issue immediately after such sub-division.
The announcement further noted that under the IPO, TJL will issue 80 million new
shares to the Sri Lankan public, and the share price will be similar to the indicative placement price.
“Immediately after completion of the TJL IPO, the shareholdings of PTJH and Brandix will drop from 45.57% to 40.00% and 34.26% to 30.08% respectively”, the announcement noted.
After the listing of TJL in the main board of Colombo Stock Exchange, it is expected that Brandix and PTJH will arrive at an agreement not to dispose shares of TJL within two years upon listing.
The announcement also said that within three years after the said two-year period, if one of them disposes any of its TJL shares, the other party shall dispose that number of TJL shares resulting in both parties maintaining their shareholding (in relation to each other) in the same proportion as at the time of listing The collective shareholding shall not fall below 51% of the total issued shares of TJL during the three-year period.
The agreement will be further extended to jointly operate in relation to certain important matters, unless the other party has given its consent in writing to vote in favor of such
resolutions.
According to the announcement, TJL net profit for the financial year ended March 31 was Rs.144 million, while the net asset value as at September 30, 2010 was Rs.5.8 billion (US $ 53,635, 000).
source - www.dailymirror.lk
Latter half lift
A buying session witnessed towards the end could not recover the initial dip in indices. Conditions are still lackluster as expected. However, the buying momentum witnessed in the latter half is expected to continue tomorrow focusing on blue chip counters.
Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Central Finance, Union Bank and HNB Bank-(X)) with the sector index decreasing 0.16%. Central Finance was the main contributor to the market turnover as retail investors renewed their interest on the stock. The share price increased by Rs 74.10 (6.56%) and closed at Rs 1,210.
Union bank saw a dip today after making substantial gains on the first day of trading. John Keells made gains to boost MPI to a certain extent.
Manufacturing sector also contributed to the market turnover (due to Royal Ceramics), with the sector index decreasing 0.56%. People’s Merchant Bank attracted investors after announcement about an acquisition of one of its subsidiaries by Capital Alliance Holdings which is still subject to regulatory approval. Investors reacted positively to Janashakthi Insurance after an interim dividend announcement of Rs 1 per share.
source - www.dailymirror.lk
Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Central Finance, Union Bank and HNB Bank-(X)) with the sector index decreasing 0.16%. Central Finance was the main contributor to the market turnover as retail investors renewed their interest on the stock. The share price increased by Rs 74.10 (6.56%) and closed at Rs 1,210.
Union bank saw a dip today after making substantial gains on the first day of trading. John Keells made gains to boost MPI to a certain extent.
Manufacturing sector also contributed to the market turnover (due to Royal Ceramics), with the sector index decreasing 0.56%. People’s Merchant Bank attracted investors after announcement about an acquisition of one of its subsidiaries by Capital Alliance Holdings which is still subject to regulatory approval. Investors reacted positively to Janashakthi Insurance after an interim dividend announcement of Rs 1 per share.
source - www.dailymirror.lk
Bourse edges down as upward roll on CF continues Union Bank declines
The Colombo bourse continued its downward trend yesterday with both indices marginally down – the All Share by 15.14 points (0.21%) and the Milanka by 5.62 points (0.08%) on a low turnover of Rs.1.18 billion, down from the previous day’s Rs.3.2 billion, with Central Finance continuing its upward roll and Union Bank losing some ground.
Central Finance was the day’s highest turnover generator with over 0.1 million shares done between Rs.1,140 and Rs.1,220 gaining Rs.74.10 to close at Rs.1,210 contributing Rs.158.7 million to the business volume.
Brokers said that there was speculation of a share split which has been taking the counter up for the past several days. The share was yesterday’s highest gainer, they noted.
Union Bank continued to show volume with over 3.3 million shares done between Rs.34.50 and Rs.40 losing Rs.2.70 to close at Rs.35.90.
Brokers said that most of yesterday’s trading in Central Finance was retail driven with retailers also active in Royal Ceramics, Laugfs, Colombo Pharmacy and Watapota (Guardian Capital Partners).
HNB X with over 0.5 million shares traded was down 40 cents to close at Rs.209 trading between Rs.208.50 and Rs.210 while Royal Ceramics was down 80 cents on nearly 0.3 million shares done between Rs.155 and Rs.157.50 to close at Rs.155.20.
Laugfs X was down Rs.2.10 to close at Rs.34.60 on 1.1 million shares done between Rs.34 and Rs.36.70 while Colombo Pharmacy lost Rs.50.80 to close at Rs.3,400 on 10,200 shares.
Watapota was up yesterday by Rs.24 to close at Rs.264.20 on over 0.1 million shares traded between Rs.225.70 and Rs.264.20.
NDB and Piramal Glass were also losers, the NDB down Rs.1.60 to Rs.344 on 7,650 shares and Piramal down 20 cents to Rs.11 on 2.1 million shares.
Melstacorp (Pvt) Ltd, a subsidiary of Distilleries Company, announced its mandatory offer at a price of Rs.27.50 for 52.98% of Pelawatte Sugar not already owned by it.
source - www.island.lk
Central Finance was the day’s highest turnover generator with over 0.1 million shares done between Rs.1,140 and Rs.1,220 gaining Rs.74.10 to close at Rs.1,210 contributing Rs.158.7 million to the business volume.
Brokers said that there was speculation of a share split which has been taking the counter up for the past several days. The share was yesterday’s highest gainer, they noted.
Union Bank continued to show volume with over 3.3 million shares done between Rs.34.50 and Rs.40 losing Rs.2.70 to close at Rs.35.90.
Brokers said that most of yesterday’s trading in Central Finance was retail driven with retailers also active in Royal Ceramics, Laugfs, Colombo Pharmacy and Watapota (Guardian Capital Partners).
HNB X with over 0.5 million shares traded was down 40 cents to close at Rs.209 trading between Rs.208.50 and Rs.210 while Royal Ceramics was down 80 cents on nearly 0.3 million shares done between Rs.155 and Rs.157.50 to close at Rs.155.20.
Laugfs X was down Rs.2.10 to close at Rs.34.60 on 1.1 million shares done between Rs.34 and Rs.36.70 while Colombo Pharmacy lost Rs.50.80 to close at Rs.3,400 on 10,200 shares.
Watapota was up yesterday by Rs.24 to close at Rs.264.20 on over 0.1 million shares traded between Rs.225.70 and Rs.264.20.
NDB and Piramal Glass were also losers, the NDB down Rs.1.60 to Rs.344 on 7,650 shares and Piramal down 20 cents to Rs.11 on 2.1 million shares.
Melstacorp (Pvt) Ltd, a subsidiary of Distilleries Company, announced its mandatory offer at a price of Rs.27.50 for 52.98% of Pelawatte Sugar not already owned by it.
source - www.island.lk
Forced selling dips market
The Colombo bourse trading formed a so called Hammer trading pattern today with ASI losing almost 35-40 index points range during majority of trading time while trading closed marginally negative to end the day. The Hammer is a bullish reversal pattern which forms during a downturn.
Drop in the market is likely to be accounted by force selling activity warranted in terms of SEC directives.
ASI lost 15.14 points (-0.21 percent) to close at 7,192.72 while highly liquid MPI dropped slightly by 5.62 points (-0.08 percent) to end trading at 6,811.78.
Daily turnover dropped to Rs 1.2 million.
Central Finance Plc (Rs 158.7 million) emerged as the top contributor to the turnover. Furthermore high turnover was witnessed in counters such as Union Bank Plc (Rs 119.6 million) and Hatton National Bank Plc (Rs 108.8 million). In addition Union Bank Plc (UBC) was the most traded counter in the day. UBC closed at Rs 35.90, down Rs 2.50. Lanka Securities
source - www.dailynews.lk
Drop in the market is likely to be accounted by force selling activity warranted in terms of SEC directives.
ASI lost 15.14 points (-0.21 percent) to close at 7,192.72 while highly liquid MPI dropped slightly by 5.62 points (-0.08 percent) to end trading at 6,811.78.
Daily turnover dropped to Rs 1.2 million.
Central Finance Plc (Rs 158.7 million) emerged as the top contributor to the turnover. Furthermore high turnover was witnessed in counters such as Union Bank Plc (Rs 119.6 million) and Hatton National Bank Plc (Rs 108.8 million). In addition Union Bank Plc (UBC) was the most traded counter in the day. UBC closed at Rs 35.90, down Rs 2.50. Lanka Securities
source - www.dailynews.lk
Commodity exchange process underway
The introduction of the commodity exchange to Sri Lanka’s capital market is at an early stage.
The Securities and Exchange Commission of Sri Lanka (SEC) has called for Expressions of Interest (EOI) and proposals for the establishment and operation of a fully fledged multi asset class commodity exchange.
At present the country’s economy is well stabilized and poised for growth. The capital market plays a key role in strengthening the economy. Hence the SEC has invited EOI’s and proposals from eligible interested parties for the establishment and operation of a fully fledged multi asset class commodity exchange.
The SEC will decide on the final outcome of the commodity exchange once they receive the response from the relevant parties. The commodity exchange is at its early stage and the results could be seen in time to come, an SEC official told Daily News Business.
The exchange should facilitate spot and future trading of multi-asset classes and needs to be incorporated as a demutualized limited liability corporate entity. It should also adhere to global practices and standards accommodate all necessary components of a commodity exchange including mechanisms for clearing and settlement of the instrument traded.
source - www.dailynews.lk
The Securities and Exchange Commission of Sri Lanka (SEC) has called for Expressions of Interest (EOI) and proposals for the establishment and operation of a fully fledged multi asset class commodity exchange.
At present the country’s economy is well stabilized and poised for growth. The capital market plays a key role in strengthening the economy. Hence the SEC has invited EOI’s and proposals from eligible interested parties for the establishment and operation of a fully fledged multi asset class commodity exchange.
The SEC will decide on the final outcome of the commodity exchange once they receive the response from the relevant parties. The commodity exchange is at its early stage and the results could be seen in time to come, an SEC official told Daily News Business.
The exchange should facilitate spot and future trading of multi-asset classes and needs to be incorporated as a demutualized limited liability corporate entity. It should also adhere to global practices and standards accommodate all necessary components of a commodity exchange including mechanisms for clearing and settlement of the instrument traded.
source - www.dailynews.lk
Wednesday, March 30, 2011
S. Lanka stx down; turnover slups to 4-mo low despite strong GDP
* Sri Lanka's 32-yr high growth announcement fails to boost bourse
* Investor woes on rising inflation hurt trading
* Rupee flat for sixth straight session
COLOMBO, March 30 (Reuters) - Sri Lanka's stock market fell on Wednesday for a third session in thin volume as inflation fears and selling to meet a regulatory deadline outweighed a government announcement 2010 GDP growth hit a 32-year high of 8.0 percent. [ID:nL3E7ET29N]
The island's main share index closed 0.21 percent or 15.14 points down at 7,192.72. It had hit a record closing high of 7,811.82 on Feb 14.
Sri Lanka's Securities and Exchange Commission has directed all stockbrokers to stop credit transactions by end-June, and cut their debtors' balances to 50 percent by Thursday. [ID:nSGE6AS0BD]
Analysts said worries over inflation may hurt the market with a possible supply disruption due to ongoing turmoil in the oil-producing Middle East and North Africa. Oil fell by 0.3 percent on Wednesday to below $115. [ID:nL3E7EU0AQ]
Sri Lanka's central bank on Monday revised its end-2011 annual average inflation target to 7 percent by December from an earlier 6 percent, while saying annual inflation may moderate from May after hitting 26-month high of 8 percent this month. [ID:nL3E7ES2HS]
The day's turnover was at 1.2 billion Sri Lanka rupees ($10.8 million), the lowest since Dec. 27 and half of last year's average of 2.4 billion rupees. This year's daily average is 3.2 billion rupees.
Foreign investors were net sellers of 93.5 million rupees worth of shares on Wednesday. They have sold a net 7.8 billion in 2011, and a record 26.4 billion in 2010.
The bourse is still Asia's best performer in 2011 with an 8.4 percent gain, after bringing in the region's best return of 96 percent last year.
Traded volume was 35.6 million, against a five-day average of 68.9 million shares. The 30-day and 90-day average trading volumes were 64.6 million and 70 million, respectively. Last year's daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 15.1, one of the highest among emerging markets, compared with 11.3 in Asian markets and 11.8 for global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed firmer at 110.35/37 a dollar from Tuesday's close of 110.38/40 on exporter dollar conversions, dealers said.
source - www.reuters.com
* Investor woes on rising inflation hurt trading
* Rupee flat for sixth straight session
COLOMBO, March 30 (Reuters) - Sri Lanka's stock market fell on Wednesday for a third session in thin volume as inflation fears and selling to meet a regulatory deadline outweighed a government announcement 2010 GDP growth hit a 32-year high of 8.0 percent. [ID:nL3E7ET29N]
The island's main share index closed 0.21 percent or 15.14 points down at 7,192.72. It had hit a record closing high of 7,811.82 on Feb 14.
Sri Lanka's Securities and Exchange Commission has directed all stockbrokers to stop credit transactions by end-June, and cut their debtors' balances to 50 percent by Thursday. [ID:nSGE6AS0BD]
Analysts said worries over inflation may hurt the market with a possible supply disruption due to ongoing turmoil in the oil-producing Middle East and North Africa. Oil fell by 0.3 percent on Wednesday to below $115. [ID:nL3E7EU0AQ]
Sri Lanka's central bank on Monday revised its end-2011 annual average inflation target to 7 percent by December from an earlier 6 percent, while saying annual inflation may moderate from May after hitting 26-month high of 8 percent this month. [ID:nL3E7ES2HS]
The day's turnover was at 1.2 billion Sri Lanka rupees ($10.8 million), the lowest since Dec. 27 and half of last year's average of 2.4 billion rupees. This year's daily average is 3.2 billion rupees.
Foreign investors were net sellers of 93.5 million rupees worth of shares on Wednesday. They have sold a net 7.8 billion in 2011, and a record 26.4 billion in 2010.
The bourse is still Asia's best performer in 2011 with an 8.4 percent gain, after bringing in the region's best return of 96 percent last year.
Traded volume was 35.6 million, against a five-day average of 68.9 million shares. The 30-day and 90-day average trading volumes were 64.6 million and 70 million, respectively. Last year's daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 15.1, one of the highest among emerging markets, compared with 11.3 in Asian markets and 11.8 for global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed firmer at 110.35/37 a dollar from Tuesday's close of 110.38/40 on exporter dollar conversions, dealers said.
source - www.reuters.com
Sri Lanka shares close down 0.21-pct
Mar 30, 2011 (LBO) - Sri Lankan shares closed lower Wednesday, with the benchmark index dipping below 7,200 points despite a late rally, and sustained interest in debutant Union Bank of Colombo which continued to weaken, brokers said.
The All Share Price Index closed at 7,192.72, down 0.21 percent (15.14 points) while the more liquid Milanka index fell 0.08 percent (5.62 points) to close at 6,811.78, according to stock exchange provisional figures.
Turnover fell to 1.18 billion rupees.
Union Bank of Colombo, which debuted Tuesday, was again the most actively traded stock, but continued to weaken, closing at 35.70 rupees, down 2.70, with 3.3 million shares traded.
The stock, which had an IPO of 15 million shares in February at 25 rupees each, had opened trading Tuesday at 45 rupees. Some trades were done at 40 rupees Wednesday.
Central Finance was among the top gainers of the day, closing at 1,204 rupees, up 74.10.
Hatton National Bank non-voting shares closed at 209.20, down 40 cents, with three crossings of 500,000 shares all at 205 rupees each.
Royal Ceramic Lanka was also actively traded, ending at 156.20, down 80 cents.
source - www.lbo.lk
The All Share Price Index closed at 7,192.72, down 0.21 percent (15.14 points) while the more liquid Milanka index fell 0.08 percent (5.62 points) to close at 6,811.78, according to stock exchange provisional figures.
Turnover fell to 1.18 billion rupees.
Union Bank of Colombo, which debuted Tuesday, was again the most actively traded stock, but continued to weaken, closing at 35.70 rupees, down 2.70, with 3.3 million shares traded.
The stock, which had an IPO of 15 million shares in February at 25 rupees each, had opened trading Tuesday at 45 rupees. Some trades were done at 40 rupees Wednesday.
Central Finance was among the top gainers of the day, closing at 1,204 rupees, up 74.10.
Hatton National Bank non-voting shares closed at 209.20, down 40 cents, with three crossings of 500,000 shares all at 205 rupees each.
Royal Ceramic Lanka was also actively traded, ending at 156.20, down 80 cents.
source - www.lbo.lk
Sri Lankan Growth Quickens to Three-Decade High After War Ends
By Anusha Ondaatjie
March 30 (Bloomberg) -- Sri Lanka’s economy expanded at the fastest pace in more than three decades as the end of a 26-year civil war in May 2009 boosted consumer demand and investment.
Gross domestic product rose 8 percent in 2010 from a year earlier, which is the most since 1978 and compares with a 3.5 percent gain in 2009, the statistics department said in a statement in Colombo yesterday.
Growth in Sri Lanka’s $42 billion economy was also supported by lower borrowing costs after the central bank cut interest rates in January for the third time in seven months. Companies including Shangri-La Asia Ltd. and Nestle Lanka Plc announced investment plans after President Mahinda Rajapaksa’s government ended the Liberation Tigers of Tamil Eelam’s quest for a separate homeland, bringing an end to conflict.
“The economy is reaping the fruits of peace,” said Bimanee Meepagala, a Colombo-based analyst at NDB Aviva Wealth Management Ltd., the nation’s biggest non-state fund. “Foreign investment and tourism will continue to grow, but this year will be a bit more challenging with inflation pressures mounting.”
The benchmark Colombo All-Share Index, which has climbed 91 percent in the past year, fell 0.03 percent yesterday. The Sri Lankan rupee was little changed at 110.4 a dollar in Colombo, according to data compiled by Bloomberg.
Growth Outlook
Sri Lanka aims to spur growth to 8.5 percent in 2011 and 9 percent in 2012, central bank Governor Ajith Nivard Cabraal said on Jan. 4.
Prospects of growing consumer demand have encouraged overseas investment. Shangri-La Asia plans to invest $500 million to build a hotel in Colombo, Deputy Economic Development Minister Lakshman Yapa Abeywardena said Dec. 16. Nestle Lanka said in January it plans to spend 10 billion rupees ($91 million) to expand in the country.
Tourist arrivals in the Indian Ocean island nation jumped 46 percent in 2010 from the previous year, according to the Sri Lanka Tourism Development Authority, boosting consumer demand.
Cabraal left rates unchanged on March 8 for a second straight month. The bank’s reverse repurchase rate is 8.5 percent.
Sri Lanka’s central bank has refrained from raising rates since 2007 even after inflation accelerated to a 25-month high in February, saying prices are rising because of “supply constraints” caused by floods. The country’s policy stance contrasts with Asian nations from South Korea to India, which are boosting borrowing costs.
Rising Prices
Consumer prices in the Sri Lankan capital, Colombo, climbed 7.8 percent in February from a year earlier, according to government data. Inflation is still less than the average 11.5 percent in the five years through December 2010, as an expansion in farm cultivation after the end of the war has boosted agriculture production.
Pressure on inflation caused by floods in the nation’s northern and eastern regions in January and early February may ease over the coming months, Cabraal said March 1.
By contrast, the Reserve Bank of India has boosted rates eight times in the past year compared with three in China and four in South Korea. Indonesia lifted its reference rate last month for the first time this year after opting not to join counterparts in increasing rates in 2010.
Credit Growth
Sri Lanka’s central bank said this month that it will monitor “the high growth in credit to the private sector and overall trends in monetary aggregates” to check price gains.
Also, rising international commodity prices, especially oil, remain a concern and the central bank will take “appropriate measures” if external price pressures persist, the bank said.
Personal and corporate credit grew 28.1 percent in Sri Lanka in January from a year earlier, more than double the pace in July, according to the central bank.
Oil is up 13 percent for the quarter and 26 percent higher than a year earlier amid concern that increased Allied attacks in Libya will prolong supply disruptions and the escalating turmoil in the Middle East may curtail shipments.
To contact the reporter on this story: Anusha Ondaatjie in Colombo at anushao@bloomberg.net
To contact the editors responsible for this story: Hari Govind at hgovind@bloomberg.net Stephanie Phang at sphang@bloomberg.net
source - noir.bloomberg.com
March 30 (Bloomberg) -- Sri Lanka’s economy expanded at the fastest pace in more than three decades as the end of a 26-year civil war in May 2009 boosted consumer demand and investment.
Gross domestic product rose 8 percent in 2010 from a year earlier, which is the most since 1978 and compares with a 3.5 percent gain in 2009, the statistics department said in a statement in Colombo yesterday.
Growth in Sri Lanka’s $42 billion economy was also supported by lower borrowing costs after the central bank cut interest rates in January for the third time in seven months. Companies including Shangri-La Asia Ltd. and Nestle Lanka Plc announced investment plans after President Mahinda Rajapaksa’s government ended the Liberation Tigers of Tamil Eelam’s quest for a separate homeland, bringing an end to conflict.
“The economy is reaping the fruits of peace,” said Bimanee Meepagala, a Colombo-based analyst at NDB Aviva Wealth Management Ltd., the nation’s biggest non-state fund. “Foreign investment and tourism will continue to grow, but this year will be a bit more challenging with inflation pressures mounting.”
The benchmark Colombo All-Share Index, which has climbed 91 percent in the past year, fell 0.03 percent yesterday. The Sri Lankan rupee was little changed at 110.4 a dollar in Colombo, according to data compiled by Bloomberg.
Growth Outlook
Sri Lanka aims to spur growth to 8.5 percent in 2011 and 9 percent in 2012, central bank Governor Ajith Nivard Cabraal said on Jan. 4.
Prospects of growing consumer demand have encouraged overseas investment. Shangri-La Asia plans to invest $500 million to build a hotel in Colombo, Deputy Economic Development Minister Lakshman Yapa Abeywardena said Dec. 16. Nestle Lanka said in January it plans to spend 10 billion rupees ($91 million) to expand in the country.
Tourist arrivals in the Indian Ocean island nation jumped 46 percent in 2010 from the previous year, according to the Sri Lanka Tourism Development Authority, boosting consumer demand.
Cabraal left rates unchanged on March 8 for a second straight month. The bank’s reverse repurchase rate is 8.5 percent.
Sri Lanka’s central bank has refrained from raising rates since 2007 even after inflation accelerated to a 25-month high in February, saying prices are rising because of “supply constraints” caused by floods. The country’s policy stance contrasts with Asian nations from South Korea to India, which are boosting borrowing costs.
Rising Prices
Consumer prices in the Sri Lankan capital, Colombo, climbed 7.8 percent in February from a year earlier, according to government data. Inflation is still less than the average 11.5 percent in the five years through December 2010, as an expansion in farm cultivation after the end of the war has boosted agriculture production.
Pressure on inflation caused by floods in the nation’s northern and eastern regions in January and early February may ease over the coming months, Cabraal said March 1.
By contrast, the Reserve Bank of India has boosted rates eight times in the past year compared with three in China and four in South Korea. Indonesia lifted its reference rate last month for the first time this year after opting not to join counterparts in increasing rates in 2010.
Credit Growth
Sri Lanka’s central bank said this month that it will monitor “the high growth in credit to the private sector and overall trends in monetary aggregates” to check price gains.
Also, rising international commodity prices, especially oil, remain a concern and the central bank will take “appropriate measures” if external price pressures persist, the bank said.
Personal and corporate credit grew 28.1 percent in Sri Lanka in January from a year earlier, more than double the pace in July, according to the central bank.
Oil is up 13 percent for the quarter and 26 percent higher than a year earlier amid concern that increased Allied attacks in Libya will prolong supply disruptions and the escalating turmoil in the Middle East may curtail shipments.
To contact the reporter on this story: Anusha Ondaatjie in Colombo at anushao@bloomberg.net
To contact the editors responsible for this story: Hari Govind at hgovind@bloomberg.net Stephanie Phang at sphang@bloomberg.net
source - noir.bloomberg.com
UPDATE 1-Peace helps Sri Lanka growth to 32-year high in 2010
* Economy grew 8 pct 2010, fastest pace since 1978
* Driven by post-war optimism
* Rising oil and commodity prices, floods, threaten growth
(Adds details, background)
By Shihar Aneez and Ranga Sirilal
COLOMBO, March 29 (Reuters) - Sri Lanka's economy grew at 8 percent in 2010, its fastest rate in 32 years, as the country enjoyed its first full-year expansion after the end of a 25-year civil war, the government said on Tuesday.
The GDP rise, which was in line with forecasts, followed growth of 3.5 percent in the Indian Ocean island nation in 2009.
The economy grew a more-than-expected 8.6 percent in the fourth quarter, accelerating from 8.0 percent in the previous quarter, the state-run Department of Census and Statistics said.
A Reuters poll had forecast a rise in full-year gross domestic product of 8.0 percent and Q4 growth of 8.1 percent. [ID:nL3E7EM1XU]
"The major reason for these increments is the prevailing peace across the country," the Department said on its website.
Sri Lanka's three-decade war ended in May 2009 and analysts and economists have said post-war optimism could help the country achieve its economic potential.
Sri Lanka's highest annual growth performance since independence was 8.2 percent in 1978, a year after the country totally liberalised its economy.
The Statistics Department said the economy's three major sectors -- agriculture, industry, and services -- had registered 2010 growth of 7.0 percent, 8.4 percent and 8.0 percent respectively. Industry and Services Sectors growth was the highest since 2002.
Sri Lankan President Mahinda Rajapaksa said on Monday the $50 billion economy will grow by up to 8.5 percent this year despite internal and external shocks, its highest rate since independence in 1948. [ID:nL3E7ES14J]
Sri Lanka imports all its oil, and Rajapaksa said the government might increase local fuel prices in line with global prices, which have spiked because of unrest in the oil-producing Middle East and North Africa. [ID:nRISKLK]
Analysts have said the impact of high global commodity prices coupled with recent floods, which the government estimates caused $500 million of damage, could cause Sri Lanka to miss its 2011 growth target of 8.5 percent. [ID:nSGE715006]
On Monday, the central bank revised up its end-2011 annual average inflation target to 7 percent from 6 percent due to rising commodity prices, especially crude oil, and supply disruption in agriculture products after two rounds of floods in the first two months of this year. [ID:nL3E7ES2H]
The crises in Libya and the Middle East could lower remittances from Sri Lankan expatriate workers and hit demand from that region for tea, as well as fuelling inflation. (Reporting by Shihar Aneez and Ranga Sirilal; Editing by Catherine Evans)
source - in.reuters.com
* Driven by post-war optimism
* Rising oil and commodity prices, floods, threaten growth
(Adds details, background)
By Shihar Aneez and Ranga Sirilal
COLOMBO, March 29 (Reuters) - Sri Lanka's economy grew at 8 percent in 2010, its fastest rate in 32 years, as the country enjoyed its first full-year expansion after the end of a 25-year civil war, the government said on Tuesday.
The GDP rise, which was in line with forecasts, followed growth of 3.5 percent in the Indian Ocean island nation in 2009.
The economy grew a more-than-expected 8.6 percent in the fourth quarter, accelerating from 8.0 percent in the previous quarter, the state-run Department of Census and Statistics said.
A Reuters poll had forecast a rise in full-year gross domestic product of 8.0 percent and Q4 growth of 8.1 percent. [ID:nL3E7EM1XU]
"The major reason for these increments is the prevailing peace across the country," the Department said on its website.
Sri Lanka's three-decade war ended in May 2009 and analysts and economists have said post-war optimism could help the country achieve its economic potential.
Sri Lanka's highest annual growth performance since independence was 8.2 percent in 1978, a year after the country totally liberalised its economy.
The Statistics Department said the economy's three major sectors -- agriculture, industry, and services -- had registered 2010 growth of 7.0 percent, 8.4 percent and 8.0 percent respectively. Industry and Services Sectors growth was the highest since 2002.
Sri Lankan President Mahinda Rajapaksa said on Monday the $50 billion economy will grow by up to 8.5 percent this year despite internal and external shocks, its highest rate since independence in 1948. [ID:nL3E7ES14J]
Sri Lanka imports all its oil, and Rajapaksa said the government might increase local fuel prices in line with global prices, which have spiked because of unrest in the oil-producing Middle East and North Africa. [ID:nRISKLK]
Analysts have said the impact of high global commodity prices coupled with recent floods, which the government estimates caused $500 million of damage, could cause Sri Lanka to miss its 2011 growth target of 8.5 percent. [ID:nSGE715006]
On Monday, the central bank revised up its end-2011 annual average inflation target to 7 percent from 6 percent due to rising commodity prices, especially crude oil, and supply disruption in agriculture products after two rounds of floods in the first two months of this year. [ID:nL3E7ES2H]
The crises in Libya and the Middle East could lower remittances from Sri Lankan expatriate workers and hit demand from that region for tea, as well as fuelling inflation. (Reporting by Shihar Aneez and Ranga Sirilal; Editing by Catherine Evans)
source - in.reuters.com
UBC shareholders dispose shares
According to market data, 17.5 million Union Bank shares traded during the day between Rs.38-45, contributing Rs.716 million to the day’s turnover. The highest traded price for the share was Rs.45 and it closed at Rs.38.50. The share began trading at Rs.45, up from Rs.20 compared to the issued price.
“Since Union Bank issued only 15 million shares, we believe some of the bank’s shareholders have disposed part of their staekes,” a stockbroker told Mirror Business.
During the day, two major crossings of Union Bank shares were executed—one million shares at Rs.42 and 765, 000 shares at Rs.31. The latter crossing was in fact, able to surprise the market nevertheless due to its price.
Yesterday Mirror Business reported that Sampath Bank, the second largest shareholder of Union Bank may dispose its 7.9 percent of 26 million shares—which they acquired at ‘zero cost’ in an accounting point of view, as Sampath has provided for the acquisition—for a huge capital gain that could amount to over Rs.800 million.
However it was not clear whether it was Sampath or any other shareholder who disposed some shares into the market.
According to unconfirmed reports Rosewood Private Limited, which was the10 largest shareholder of Union Bank disposed its entire shareholding or part of it into the market.
According to the prospectus, the top ten shareholders of Union Bank were Vista Knowledge (Pte) Ltd. (19.4%), Sampath Bank Plc (7.9%), Associated Electrical (7.41%), Select Gain Limited (7.01%), Ajith Wijeyesekera (5.23%), Alex Lovell (5.1%), Exab International (4.5), Caritano venture Corp. (3.82%), First Gulf Asia Holdings (3%) and Rosewood Private Limited (2.86%).
US $ 5 million IFC facility for UBC
International Finance Corporation (IFC), a member of the World Bank Group, will provide a $5 million trade-finance facility to the Union Bank of Colombo Limited to help boost international trade opportunities for the bank and its small-business and corporate-sector clients.
The trade-finance facility will provide the Union Bank of Colombo with risk coverage and access to a global network that will support growth of the bank’s trade-finance business. The network will facilitate transactions in challenging markets and enable Union Bank to build relationships with new institutions that will reduce risk and provide trade opportunities for small and medium enterprises.
“IFC’s support is very timely as Union Bank embarks on a new strategy to become the preferred banker for small and medium enterprises,” said Anil Amarasuriya, Director and CEO of Union Bank of Colombo Limited. “The facility will help us better support smaller businesses by offering trade-finance products.” This investment adds to IFC’s list of banks in Sri Lanka that are supported under IFC’s Global Trade Finance Programme.
“IFC’s support to Union Bank of Colombo fits well with our strategy to partner with banks and financial institutions that are committed to developing Sri Lanka’s small and medium enterprises,” said Rachel F. Robbins, IFC Vice President and General Counsel. “The facility will help strengthen the bank’s capacity to support trade finance and provide access to over 80 emerging-market countries.”
IFC launched its Global Trade Finance Programme in 2005, to help increase global trade in developing countries and promote flows of goods and services among these nations. The programme has now a network of more than 300 participating banks worldwide. In fiscal 2010, IFC issued $3.46 billion in guarantees through the programme to support trade with emerging markets.
source - www.dailymirror.lk
Profit taking by early investors in private placement - Bourse edges down despite Union Bank debut
The Colombo bourse closed down yesterday on a turnover of Rs.3.23 billion, up from the previous day’s Rs.1.6 billion, with the All Share down a marginal 2.23 points (0.03%) while the Milanka lost 21.01 points (0.35%) with 105 losers ahead of 68 gainers. Union Bank made its debut on the trading boards yesterday with more shares than issued at the IPO traded, gaining Rs.13.40 to close at Rs.38.60 on 17.5 million shares that were transacted.
"It looks as though some shareholders who bought in private placements ahead of the IPO had sold," Prashan Fernando of Acuity Stockbrokers said. "It is also possible that the same shares were sold more than once but given that the share came down from Rs.45 to Rs.38, these numbers could not have been high.’’
Union Bank traded between Rs.38 and Rs.45 yesterday going up from Rs.38 to Rs.40 and then coming down again to Rs.38.60 brokers said.
Yesterday’s biggest trade was in Commercial Bank where 13.7 million shares were done between Rs.268.10 and Rs.271 gaining 90 cents to close at Rs.268.10. The transactions totaled to 1.2% of the company.
There were several crossings on ComBank at a price of Rs.270 accounting for nearly the total number of shares traded yesterday.
Union Bank too saw five crossings – two at a low price of Rs.31 and three others accounting a million shares each at Rs.42.
Other big trades yesterday included Asian Alliance Insurance where 3.6 million shares were done including three crossings of 1.2 million shares each at Rs.190. The counter traded between Rs.155 and Rs.175 losing Rs.6.10 to close at Rs.165.90.
Hayleys too with over 1.1 million shares traded between Rs.388 and Rs.390 closed 30 cents down at Rs.388 with one crossing of over 0.5 million shares done at the Rs.380 price at which Mr. Dhammika Perera and connected parties made their mandatory offer.
Ascot Holdings gained Rs.6.50 to close at Rs.122.40 on nearly 1.4 million shares traded between Rs.116.30 and Rs.124 while Central Finance closed Rs.24.20 up at Rs.1,120 on 0.1 million shares done between Rs.1,101.10 and Rs.1,170.
CT Holdings announced a rights issue of one for 55 at Rs.210 to issue approximately 3.1 million new shares XR on April 29 and payment on May 24. Ceylinco Insurance announced a dividend of Rs.5.50 per share.
source - www.island.lk
"It looks as though some shareholders who bought in private placements ahead of the IPO had sold," Prashan Fernando of Acuity Stockbrokers said. "It is also possible that the same shares were sold more than once but given that the share came down from Rs.45 to Rs.38, these numbers could not have been high.’’
Union Bank traded between Rs.38 and Rs.45 yesterday going up from Rs.38 to Rs.40 and then coming down again to Rs.38.60 brokers said.
Yesterday’s biggest trade was in Commercial Bank where 13.7 million shares were done between Rs.268.10 and Rs.271 gaining 90 cents to close at Rs.268.10. The transactions totaled to 1.2% of the company.
There were several crossings on ComBank at a price of Rs.270 accounting for nearly the total number of shares traded yesterday.
Union Bank too saw five crossings – two at a low price of Rs.31 and three others accounting a million shares each at Rs.42.
Other big trades yesterday included Asian Alliance Insurance where 3.6 million shares were done including three crossings of 1.2 million shares each at Rs.190. The counter traded between Rs.155 and Rs.175 losing Rs.6.10 to close at Rs.165.90.
Hayleys too with over 1.1 million shares traded between Rs.388 and Rs.390 closed 30 cents down at Rs.388 with one crossing of over 0.5 million shares done at the Rs.380 price at which Mr. Dhammika Perera and connected parties made their mandatory offer.
Ascot Holdings gained Rs.6.50 to close at Rs.122.40 on nearly 1.4 million shares traded between Rs.116.30 and Rs.124 while Central Finance closed Rs.24.20 up at Rs.1,120 on 0.1 million shares done between Rs.1,101.10 and Rs.1,170.
CT Holdings announced a rights issue of one for 55 at Rs.210 to issue approximately 3.1 million new shares XR on April 29 and payment on May 24. Ceylinco Insurance announced a dividend of Rs.5.50 per share.
source - www.island.lk
Army Hospital moves to former Asiri Central for Rs. 60 m one-year lease
The former premises of Asiri Central in Horton Place, Colombo 7, has been leased for one year to the Sri Lanka Army to set up the Army Hospital, for Rs. 60 million.
The move follows Asiri Central Hospitals Plc entering into a lease agreement with Army Commander Lieutenant General Jagath Jayasuriya for the leasing of land, building and premises of the former together with the right of ways for the use of Sri Lanka Army for one year from 24 February 2011 to 23 February 2012.
Though the agreement was signed over a month ago, Asiri Central Hospitals, which is part of Asiri Hospital Holdings, controlled by Softlogic Group, made the disclosure only yesterday.
source - www.ft.lk
The move follows Asiri Central Hospitals Plc entering into a lease agreement with Army Commander Lieutenant General Jagath Jayasuriya for the leasing of land, building and premises of the former together with the right of ways for the use of Sri Lanka Army for one year from 24 February 2011 to 23 February 2012.
Though the agreement was signed over a month ago, Asiri Central Hospitals, which is part of Asiri Hospital Holdings, controlled by Softlogic Group, made the disclosure only yesterday.
source - www.ft.lk
EPF ups COMBank stake to 9% - Picks up a fresh 1.2% stake for Rs. 1.19 b from foreign fund
The Employees Provident Fund (EPF) yesterday increased its stake in Sri Lanka’s biggest private sector bank, Commercial Bank, to around 9%, by picking up a 1.2% stake for Rs. 1.19 billion.
Giving a boost to an otherwise bearish market, 4.59 million shares of Commercial Bank traded for Rs. 1.24 billion. A total of 4.4 million shares changed hands via crossings at Rs. 270 per share with the buyer being EPF. The seller was a foreign fund as non-national shareholding of COMBank declined by 4.4 million yesterday.
As at end 2010, EPF’s stake in COMBank was around 5% and in recent months it has been collecting blocks of 1% and is now estimated to be owning a nearly 9% stake.
The share price of COMBank dipped by 90 cents and closed at Rs. 268.10. The COMBank's AGM takes place today at 10.30 a.m. at Colombo Hilton.
Deals on COMBank and Union Bank saw the Bank, Finance and Insurance sector contributing most to the market turnover whilst the sector index rose by 0.54%.
Union Bank debut fails to light up bourse
The debut of record-setting Union Bank of Colombo failed to light up the stock market yesterday, in addition to producing a mixed performance overall.
Around a 5% stake of the company amounting to 17.46 million shares (but well above the 15 million issued via the Initial Public Offering) of Union Bank debuted, generating a turnover of Rs. 715.7 million. Offered at Rs. 15 in the IPO, the share opened at Rs. 45, which incidentally was its highest before closing at Rs. 38.40, up by 53% or Rs. 13.40.
The 17.4 million shares changed hands via 16,164 trades. There were three crossings (1,500,000 shares at Rs. 42 and 765,000 shares at Rs. 31).
Given the Rs. 375 m IPO’s 350 times oversubscription, described as one of the highest globally, some viewed the debut performance of Union Bank as below par, whilst others said above 50% gain was significant in a bearish market.
Its peak of Rs. 45 was as expected by some whilst the more bullish forecast Rs. 50, but the closing below Rs. 40 was a damper.
Giving credence to the tone of underperformance, NDB Stockbrokers said: “Union Bank attracted investors although a lower price appreciation was witnessed than anticipated, especially considering its record-breaking oversubscription.”
Deals on Union accounted for the second largest turnover, trailing by mega deals on Commercial Bank worth Rs. 1.24 billion.
Commenting on the overall market, NDB said indices were volatile throughout the trading hours and closed in red with selling pressure creeping in.
source - www.ft.lk
Giving a boost to an otherwise bearish market, 4.59 million shares of Commercial Bank traded for Rs. 1.24 billion. A total of 4.4 million shares changed hands via crossings at Rs. 270 per share with the buyer being EPF. The seller was a foreign fund as non-national shareholding of COMBank declined by 4.4 million yesterday.
As at end 2010, EPF’s stake in COMBank was around 5% and in recent months it has been collecting blocks of 1% and is now estimated to be owning a nearly 9% stake.
The share price of COMBank dipped by 90 cents and closed at Rs. 268.10. The COMBank's AGM takes place today at 10.30 a.m. at Colombo Hilton.
Deals on COMBank and Union Bank saw the Bank, Finance and Insurance sector contributing most to the market turnover whilst the sector index rose by 0.54%.
Union Bank debut fails to light up bourse
The debut of record-setting Union Bank of Colombo failed to light up the stock market yesterday, in addition to producing a mixed performance overall.
Around a 5% stake of the company amounting to 17.46 million shares (but well above the 15 million issued via the Initial Public Offering) of Union Bank debuted, generating a turnover of Rs. 715.7 million. Offered at Rs. 15 in the IPO, the share opened at Rs. 45, which incidentally was its highest before closing at Rs. 38.40, up by 53% or Rs. 13.40.
The 17.4 million shares changed hands via 16,164 trades. There were three crossings (1,500,000 shares at Rs. 42 and 765,000 shares at Rs. 31).
Given the Rs. 375 m IPO’s 350 times oversubscription, described as one of the highest globally, some viewed the debut performance of Union Bank as below par, whilst others said above 50% gain was significant in a bearish market.
Its peak of Rs. 45 was as expected by some whilst the more bullish forecast Rs. 50, but the closing below Rs. 40 was a damper.
Giving credence to the tone of underperformance, NDB Stockbrokers said: “Union Bank attracted investors although a lower price appreciation was witnessed than anticipated, especially considering its record-breaking oversubscription.”
Deals on Union accounted for the second largest turnover, trailing by mega deals on Commercial Bank worth Rs. 1.24 billion.
Commenting on the overall market, NDB said indices were volatile throughout the trading hours and closed in red with selling pressure creeping in.
source - www.ft.lk
Capital Alliance buys finance company from PMB for Rs. 430 m
Capital Alliance Holdings Ltd. will be entering into the registered finance company business with the acquisition of a subsidiary of People’s Merchant Bank (PMB) for Rs. 430 million.
The decision to divest the subsidiary People’s Merchant Finance Company Ltd. (formerly Silvereen Finance Company) was made by PMB Board on Monday. People’s Bank owns 26% stake in PMB along with 19.7% by LOLC and 13% by People’s Leasing
PMB paid Rs. 287 million for the purchase of Silvereen in the 2009/10 financial year as a strategic move since the venture would pave way for it to mobilise public deposits for growth of lending activities. Later on, a move to amalgamate the finance company with PMB was mooted but put on hold.
In January this year, following a directive given by the Central Bank, the PMB Board decided not to proceed with the decision to take over the assets and liabilities of People’s Merchant Finance Company Ltd. (PMF).
Controlled by financial market specialist Ajith Fernando, Capital Alliance Group is engaged primary dealership of government securities, stock broking and tea broking.
The company was incorporated 29 years ago and is a Central Bank of Sri Lanka registered finance company based in Kandy.
The operations are carried out only from its head office in Kandy. With access to public deposits, group finance cost could be brought down substantially in the future. The finance company’s main line of businesses includes leasing, hire purchase, trade finance and deposit mobilisation.
The total assets of the company as at end 2009/10 were around Rs. 300 million. Leasing and hire purchase advances have reduced to Rs. 142 million at FY 2009/10 end from Rs. 207 million at end of FY 2008/09, a reduction of 31%.
Deposits of the company amounted to Rs. 63 million, down from Rs. 79 million at end of FY 2008/09 with low business operations. It had a profit before tax of Rs. 8.7 million for the financial year ended 31 March 2010. However, due to high income tax charge of Rs. 5.5 million, profit after tax amounted to Rs. 3.1 million.
source - www.ft.lk
The decision to divest the subsidiary People’s Merchant Finance Company Ltd. (formerly Silvereen Finance Company) was made by PMB Board on Monday. People’s Bank owns 26% stake in PMB along with 19.7% by LOLC and 13% by People’s Leasing
PMB paid Rs. 287 million for the purchase of Silvereen in the 2009/10 financial year as a strategic move since the venture would pave way for it to mobilise public deposits for growth of lending activities. Later on, a move to amalgamate the finance company with PMB was mooted but put on hold.
In January this year, following a directive given by the Central Bank, the PMB Board decided not to proceed with the decision to take over the assets and liabilities of People’s Merchant Finance Company Ltd. (PMF).
Controlled by financial market specialist Ajith Fernando, Capital Alliance Group is engaged primary dealership of government securities, stock broking and tea broking.
The company was incorporated 29 years ago and is a Central Bank of Sri Lanka registered finance company based in Kandy.
The operations are carried out only from its head office in Kandy. With access to public deposits, group finance cost could be brought down substantially in the future. The finance company’s main line of businesses includes leasing, hire purchase, trade finance and deposit mobilisation.
The total assets of the company as at end 2009/10 were around Rs. 300 million. Leasing and hire purchase advances have reduced to Rs. 142 million at FY 2009/10 end from Rs. 207 million at end of FY 2008/09, a reduction of 31%.
Deposits of the company amounted to Rs. 63 million, down from Rs. 79 million at end of FY 2008/09 with low business operations. It had a profit before tax of Rs. 8.7 million for the financial year ended 31 March 2010. However, due to high income tax charge of Rs. 5.5 million, profit after tax amounted to Rs. 3.1 million.
source - www.ft.lk
Free Lanka Capital Holdings shares allotted
The basis of allotment of Free Lanka Capital Holdings was announced yesterday. Retail investors who applied for upto 10,000 shares will obtain the entire amount which they applied according to the new rules set by the Securities and Exchange Commission (SEC).
According to the share allotment statement in the retail category, those who have applied for between 10,001 - 17,001 shares will get 10,700 shares while the investors that have applied for between 17,001 t- 20,000 will get 11,000 shares.
Those who applied for over 200 million shares will be allotted a minimum of 11,000 shares plus 0.94 percent on the balance number of shares and another 19,950 shares, the statement said.
Under the SEC new rules a minimum of 40 percent of the offered shares in a public offer has to be made available for allotment to retail individual investors.
A retail individual investor shall be defined as an individual investor who applies for up to a maximum of 3,000 shares or for a value not more than Rs 100,000 whichever is higher.
source - www.dailynews.lk
IFC, Union Bank boost for trade To provide $ 5 million trade-finance facility
Union Bank Director and CEO Anil Amarasuriya and IFC Vice President, General Counsel Rachel F Robbins exchange the agreements. Senior Union Bank and IFC officials look on.
The trade-finance facility will provide the Union Bank of Colombo with risk coverage and access to a global network that will support growth of the bank’s trade-finance business.
The network will facilitate transactions in challenging markets and enable Union Bank to build relationships with new institutions that will reduce risk and provide trade opportunities for small and medium enterprises.
“IFC’s support is very timely as Union Bank embarks on a new strategy to become the preferred banker for small and medium enterprises,” Union Bank of Colombo Limited Director and CEO Anil Amarasuriya said.
“The facility will help us better support smaller businesses by offering trade-finance products.”
This investment adds to IFC’s list of banks in Sri Lanka that are supported under IFC’s Global Trade Finance Program.
“IFC’s support to Union Bank of Colombo fits well with our strategy to partner with banks and financial institutions that are committed to developing Sri Lanka’s small and medium enterprises,” said IFC Vice President, General Counsel Rachel F Robbins said.
“The facility will help strengthen the bank’s capacity to support trade finance and provide access to over 80 emerging-market countries.”
IFC launched its Global Trade Finance Program in 2005 to help increase global trade in developing countries and promote flows of goods and services among these nations. The program now has a network of more than 300 participating banks worldwide.
In fiscal 2010, IFC issued $3.46 billion in guarantees through the program to support trade with emerging markets.
source - www.dailynews.lk
Sri Lanka shares close down
Mar 29, 2011 (LBO) - Sri Lankan shares closed marginally down Tuesday with interest in banking stocks especially Union Bank of Colombo (UBC) which began trading, brokers said.
The All Share Price Index closed at 7,207.86, down 0.03 percent (2.23 points) while the more liquid Milanka index fell 0.31 percent (21.01 points) to close at 6,817.40, according to stock exchange provisional figures.
Turnover was 3.2 billion rupees boosted by 21 crossings or private deals, including eight of Commercial Bank and seven of UBC.
Union Bank of Colombo sharea, which opened trading Tuesday at 45 rupees, closed at 38.60 after hitting a high of 45 and a low of 38.
It was the most actively traded stock and the day's highest gainer, closing up 53 percent or 13.40 rupees with almost 17.5 million shares traded.
There were seven UBC crossings of 4.5 million shares, with four million shares at 42 rupees each and 1,530,000 at 31 rupees each.
The bank had offered 15 million shares to the public in an IPO in February at 25 rupees a share
Commercial Bank was also heavily traded generating 3,032.5 million rupees in turnover and closing at 268.20 rupees, down 90 cents.
There were crossings of 11.2 million shares at 270 rupees each.
source - www.lbo.lk
The All Share Price Index closed at 7,207.86, down 0.03 percent (2.23 points) while the more liquid Milanka index fell 0.31 percent (21.01 points) to close at 6,817.40, according to stock exchange provisional figures.
Turnover was 3.2 billion rupees boosted by 21 crossings or private deals, including eight of Commercial Bank and seven of UBC.
Union Bank of Colombo sharea, which opened trading Tuesday at 45 rupees, closed at 38.60 after hitting a high of 45 and a low of 38.
It was the most actively traded stock and the day's highest gainer, closing up 53 percent or 13.40 rupees with almost 17.5 million shares traded.
There were seven UBC crossings of 4.5 million shares, with four million shares at 42 rupees each and 1,530,000 at 31 rupees each.
The bank had offered 15 million shares to the public in an IPO in February at 25 rupees a share
Commercial Bank was also heavily traded generating 3,032.5 million rupees in turnover and closing at 268.20 rupees, down 90 cents.
There were crossings of 11.2 million shares at 270 rupees each.
source - www.lbo.lk
Sri Lanka small investors get preference in Free Lanka IPO
Mar 29, 2011 (LBO) - Sri Lankan small investors who applied for a recent initial public offer by Free Lanka Capital Holdings will get all the shares they asked for under new rules set by the capital markets watchdog.
A stock exchange filing said investors in the retail category who applied for up to 10,000 shares in the Free Lanka IPO will get all they asked for.
The IPO of 300 million shares by Free Lanka Capital Holdings to raise 1.5 billion rupees was oversubscribed on the opening day.
For others in the retail category, those who applied for between 10,001 and 17,001 shares will get 10,700 shares and those who asked for between 17,001 to 20,000 will get 11,000 shares.
In the non-retail category, those who applied for between 20,001 and 200 million shares will get a minimum of 11,000 shares plus 0.94 percent on the balance number of shares rounded to the nearest 100.
Those who applied for over 200 million shares will be allotted a minimum of 11,000 shares plus 0.94 percent on the balance number of shares and another 19,950 shares, the statement said.
The Securities and Exchange Commission, the capital markets watchdog, recently gave retail investors and unit trusts preference in allocation of shares in IPOs.
The new rules effective from March 15 requires a minimum of 40 percent of the offered shares in an IPO to be offered to individual retail investors.
A minimum of 10 percent of an issue will be made available for allotment to Unit Trust Funds.
Sri Lanka's capital markets and banking regulators also plan to cap IPO bank guarantees, many covering the entirety of an issue, to ensure small investors a fairer share.
The move follows complaints that small investors were being edged out by big investors who use bank guarantees to apply for IPOs.
source - www.lbo.lk
A stock exchange filing said investors in the retail category who applied for up to 10,000 shares in the Free Lanka IPO will get all they asked for.
The IPO of 300 million shares by Free Lanka Capital Holdings to raise 1.5 billion rupees was oversubscribed on the opening day.
For others in the retail category, those who applied for between 10,001 and 17,001 shares will get 10,700 shares and those who asked for between 17,001 to 20,000 will get 11,000 shares.
In the non-retail category, those who applied for between 20,001 and 200 million shares will get a minimum of 11,000 shares plus 0.94 percent on the balance number of shares rounded to the nearest 100.
Those who applied for over 200 million shares will be allotted a minimum of 11,000 shares plus 0.94 percent on the balance number of shares and another 19,950 shares, the statement said.
The Securities and Exchange Commission, the capital markets watchdog, recently gave retail investors and unit trusts preference in allocation of shares in IPOs.
The new rules effective from March 15 requires a minimum of 40 percent of the offered shares in an IPO to be offered to individual retail investors.
A minimum of 10 percent of an issue will be made available for allotment to Unit Trust Funds.
Sri Lanka's capital markets and banking regulators also plan to cap IPO bank guarantees, many covering the entirety of an issue, to ensure small investors a fairer share.
The move follows complaints that small investors were being edged out by big investors who use bank guarantees to apply for IPOs.
source - www.lbo.lk
Sri Lanka construction, housing market expands
Mar 29, 2011 (LBO) - Sri Lanka's construction industry and housing market grew strongly in 2001 compared with the year before driven by infrastructure projects, resettlement after a war and increased borrowing.
The construction sub sector of gross domestic product grew 9.3 percent in 2010 from a growth of 5.6 percent the previous year, the Department of Census & Statistics (DCS) said in a statement.
"This growth was supported by the introduction of new development projects, the large scale projects already in operation and rehabilitation and resettlement programmes, especially in Northern and Eastern provinces."
The end of the island's 30-year ethnic war in 2009 has revived economic activity and resulted in an infrastructure building boom.
Total cement production rose 16.7 percent to 3,749,005 metric tonnes in 2010 from 3,212,865 MT in 2009.
"The disbursement of loans for construction of houses, business premises, other buildings, and property developments increased by 39.6 percent during the year," the statement said.
source - www.lbo.lk
The construction sub sector of gross domestic product grew 9.3 percent in 2010 from a growth of 5.6 percent the previous year, the Department of Census & Statistics (DCS) said in a statement.
"This growth was supported by the introduction of new development projects, the large scale projects already in operation and rehabilitation and resettlement programmes, especially in Northern and Eastern provinces."
The end of the island's 30-year ethnic war in 2009 has revived economic activity and resulted in an infrastructure building boom.
Total cement production rose 16.7 percent to 3,749,005 metric tonnes in 2010 from 3,212,865 MT in 2009.
"The disbursement of loans for construction of houses, business premises, other buildings, and property developments increased by 39.6 percent during the year," the statement said.
source - www.lbo.lk
Tuesday, March 29, 2011
Laugfs Gas launches non-acetylene metal cutting gas
Sri Lankan Liquid Petroleum (LP) gas company Laugfs announced the signing of a joint venture agreement with the Bharat Petroleum Corporation Ltd. of India, to bring to the local market what it terms as an “innovative metal cutting gas”. It was launched under the brand name “Laugfs Bharat Metal Cutting Gas” (LBMCG) recently, and is expected to revolutionize the industrial sector, offering safe cutting gas at a lower cost.
Commenting on the new product the Chairman of Laugfs Gas PLC, W K Wegapitiya said that LBMCG is a Hydrocarbon-based industrial gas with a high flame temperature which produces an un-paralleled fine cut finish and at a very low cost compared to Acetylene. LBMCG is used in the applications of cutting, brazing, heating, soldering, coating gas surfacing, flame spraying, flame straightening and hardening. According to Wegapitiya, the existing cutting gas that is available in the country and is the most commonly used metal cutting gas in Sri Lanka- Acetylene, which is mixed with Oxygen.
Wegapitiya commented that this was a great achievement for the company. “We will be using our existing as well as new infrastructure to make available our new product across the country including the North and East. The introduction of LBMCG is expected to revolutionize the country’s industrial sector by reducing the cutting gas cost by a significant amount giving considerable cost savings to industrial users,” he added.
source - www.dailymirror.lk
Softlogic Finance records impressive portfolio growth
Softlogic Finance has recorded an unprecedented portfolio growth during the last year. The company, previously known as Capital Reach Leasing, has seen a remarkable transformation as is evident in its performance this year.
“Our advances portfolio has grown by 200%, and we have been able to maintain the quality of our receivables. Our portfolio is undoubtedly among the best-maintained in the industry, with Non-Performing Advances at under 1.5%,” said Nalin Wijekoon, Deputy CEO of Softlogic Finance.
With significant growth in the country’s tourism, transport and construction sectors, Softlogic Finance was able to aggressively grow its business through its branch network located island-wide.
The secret behind Softlogic Finance’s triumphant year is sound management, said Wijekoon elaborating that the company’s operations are streamlined in keeping with the Corporate Governance Principles implemented by the Securities & Exchange Commission and guidelines of the Central Bank of Sri Lanka.
“Our focus remains on sound lending. The public confidence in Softlogic Finance is clearly reflected in the in-growth of the company’s deposit base by 100%. In addition, this year we have been able to successfully raise LKR 1.5Bn through securitization of our receivables. The last securitization completed was for Rs. 384 million, which was also executed with Deutsche Bank appointed as the trustee” he further stated.
Softlogic Finance PLC has embarked on an aggressive growth strategy with plans to expand its branch network and product portfolio to suit the market needs. Its flagship branch in Colombo 3 is expected to be opened in the near future, followed by new branches at strategic locations to support its business plans.
source - www.dailymirror.lk
“Our advances portfolio has grown by 200%, and we have been able to maintain the quality of our receivables. Our portfolio is undoubtedly among the best-maintained in the industry, with Non-Performing Advances at under 1.5%,” said Nalin Wijekoon, Deputy CEO of Softlogic Finance.
With significant growth in the country’s tourism, transport and construction sectors, Softlogic Finance was able to aggressively grow its business through its branch network located island-wide.
The secret behind Softlogic Finance’s triumphant year is sound management, said Wijekoon elaborating that the company’s operations are streamlined in keeping with the Corporate Governance Principles implemented by the Securities & Exchange Commission and guidelines of the Central Bank of Sri Lanka.
“Our focus remains on sound lending. The public confidence in Softlogic Finance is clearly reflected in the in-growth of the company’s deposit base by 100%. In addition, this year we have been able to successfully raise LKR 1.5Bn through securitization of our receivables. The last securitization completed was for Rs. 384 million, which was also executed with Deutsche Bank appointed as the trustee” he further stated.
Softlogic Finance PLC has embarked on an aggressive growth strategy with plans to expand its branch network and product portfolio to suit the market needs. Its flagship branch in Colombo 3 is expected to be opened in the near future, followed by new branches at strategic locations to support its business plans.
source - www.dailymirror.lk
Sampath poised for huge capital gain
UNION BANK IPO
By Jithendra Antonio
While the much hyped Union Bank ordinary voting shares are yet to be traded on the trading floor today, it is learnt that Sampath Bank is poised to earn a huge capital gain that could amount to Rs.800 million, disposing its 7.9 percent stake in Union Bank.
“We may sell it if we get an attractive price in the market”, a Sampath Bank official told Mirror Business on the grounds of anonymity.
As per a valuation by a stock broking company, Union Bank shares priced at Rs.25 are likely to be traded at Rs.40 levels in the first day of trading.
According to the official, Sampath holds 26 million shares of Union Bank of Colombo (UBC) of which only 838,127 shares were bought at Rs.25 while the rest were purchased at Rs.10 per share. Sampath Bank in its annual report for 2010 said the total cost for UBC’s equity investment was Rs.276 million.
As to date, Sampath stands as the second largest (7.9% stake) shareholder of UBC, followed by Vista Knowledge Pte Ltd. with a 19.4% stake (64.677 million ordinary shares) of UBC.
Few weeks back, Sampath Bank CEO had said they were looking forward to dispose its 7.9 percent stake in UBC, as the bank is not keen on having substantial stakes in other commercial banks.
Union Bank officials on the day of the IPO announcement had said, major shareholders of UBC will be bounded by the SEC’s ‘Lock In’ Rule that prevents private investors from dumping shares at high market prices. The SEC later in February revealed that the ‘Lock In Rule’ will be only applied from February 8 onwards.
Meanwhile, the Sampath official said the ‘lock In’ rule will not affect Sampath bank’s sale of UBC shares on Colombo’s trading floor, as Sampath infused capital to UBC before December 2010.
Union Bank is offering 15 million shares at Rs. 25 each in three categories—1.5 million shares for its employees, 2.25 million for customers that have maintained accounts for a minimum of 6 months as at 31 January 2011, and 11.25 million shares for other investors via its IPO.
source - www.dailymirror.lk
By Jithendra Antonio
While the much hyped Union Bank ordinary voting shares are yet to be traded on the trading floor today, it is learnt that Sampath Bank is poised to earn a huge capital gain that could amount to Rs.800 million, disposing its 7.9 percent stake in Union Bank.
“We may sell it if we get an attractive price in the market”, a Sampath Bank official told Mirror Business on the grounds of anonymity.
As per a valuation by a stock broking company, Union Bank shares priced at Rs.25 are likely to be traded at Rs.40 levels in the first day of trading.
According to the official, Sampath holds 26 million shares of Union Bank of Colombo (UBC) of which only 838,127 shares were bought at Rs.25 while the rest were purchased at Rs.10 per share. Sampath Bank in its annual report for 2010 said the total cost for UBC’s equity investment was Rs.276 million.
As to date, Sampath stands as the second largest (7.9% stake) shareholder of UBC, followed by Vista Knowledge Pte Ltd. with a 19.4% stake (64.677 million ordinary shares) of UBC.
Few weeks back, Sampath Bank CEO had said they were looking forward to dispose its 7.9 percent stake in UBC, as the bank is not keen on having substantial stakes in other commercial banks.
Union Bank officials on the day of the IPO announcement had said, major shareholders of UBC will be bounded by the SEC’s ‘Lock In’ Rule that prevents private investors from dumping shares at high market prices. The SEC later in February revealed that the ‘Lock In Rule’ will be only applied from February 8 onwards.
Meanwhile, the Sampath official said the ‘lock In’ rule will not affect Sampath bank’s sale of UBC shares on Colombo’s trading floor, as Sampath infused capital to UBC before December 2010.
Union Bank is offering 15 million shares at Rs. 25 each in three categories—1.5 million shares for its employees, 2.25 million for customers that have maintained accounts for a minimum of 6 months as at 31 January 2011, and 11.25 million shares for other investors via its IPO.
source - www.dailymirror.lk
SFCL lodges shares, but no real selling
Even though 1000 shares of Senkadagala Finace (SFCL) were lodged for sale from last Friday, it seems that the sellers were not serious in selling the shares, as there were buyers who bid for more than 10 times of the real value of the share.
The company sought listing in the Colombo Stock Exchange, by the way of an Introduction, to fulfill a regulatory requirement.
During the first few days, there were over 50 million bidders willing to buy Senkadagala shares, offering more than 10 times of the book value of the share, which was around Rs.20.
The following day, there were around 30 million bids to purchase shares, though no shares were lodged.
According to the Introductory Document of the listing, the firm had a public holding of 10.08 percent and 19 shareholders.
In the nine months to December 2010, Senkadagala reported unaudited profits of Rs. 161 million, up from Rs. 57 million a year earlier, giving earnings of Rs. 3.02 per share.
source - www.dailymirror.lk
Nahil revalues properties
Business figure Nahil Wijesuriya-controlled East West Properties PLC (EAST) yesterday said, a recent revaluation of its properties showed a value increase exceeding Rs.1 billion.
The company said the leasehold land (with unexpired lease period of 72 years) in Peliyagoda had been estimated at Rs. 691 million as at 21 March 2011. It was noted that the book value of the property is only Rs..30 million.
The revaluation has also slightly increased the value of the company’s condominium apartment at Crescat Residencies in Colombo 3. The new value of the property stands at Rs.89 million, while the book value is 79 million.
The company has also revalued a warehouse in Peliyagoda at Rs.40 million, while its book value lies at Rs.15 million.
In the meantime, a lease agreement of another property given to Utratech Cement has expired in 2007, and the cement company is supposed to vacate the land together with Cement Silos, buildings and the permanent fixtures, without claiming any compensation.
Accordingly, the buildings and cement silos were valued at Rs.634 million.
source - www.dailymirror.lk
The company said the leasehold land (with unexpired lease period of 72 years) in Peliyagoda had been estimated at Rs. 691 million as at 21 March 2011. It was noted that the book value of the property is only Rs..30 million.
The revaluation has also slightly increased the value of the company’s condominium apartment at Crescat Residencies in Colombo 3. The new value of the property stands at Rs.89 million, while the book value is 79 million.
The company has also revalued a warehouse in Peliyagoda at Rs.40 million, while its book value lies at Rs.15 million.
In the meantime, a lease agreement of another property given to Utratech Cement has expired in 2007, and the cement company is supposed to vacate the land together with Cement Silos, buildings and the permanent fixtures, without claiming any compensation.
Accordingly, the buildings and cement silos were valued at Rs.634 million.
source - www.dailymirror.lk
Union Bank shares listed today, investors unhappy but banks make gains with guarantees
By Hiran H. SenewiratneInvestors who applied via bank guarantees for Union Bank’s Rs. 375 Initial Public Offering (IPO) have been disappointed as they could not cover the cost of the bank guarantees, said Head of Sales and Marketing, Lanka Securities (Pvt.) Ltd. Eardley Kern.
"The high demand for Union Bank’s IPO was due to the bank guarantees which had to be backed by cash deposits amounting to Rs. 11 million in total. This resulted in the IPO being oversubscribed by around 300 times.
"Before the IPO, several banks issued bank guarantees at 0.125 percent of the value of shares applied for. These banks were able to secure very good returns. However, many applicants are disappointed as many could not purchase the expected number of shares due to the heavy demand," he said.
The heavily oversubscribed Union Bank shares will commence trading today (29) and punters are expected to cover some of their costs.
The SEC recently issued a directive limiting the value of bank guarantees backing an IPO application and the Central Bank is expected to instruct banks to comply. Brokers said in previous IPOs, investors have been known to invest in the entire subscription via bank guarantees.
source - www.island.lk
Seylan Bank-dumped Lanka Ashok fame shareholder director Saliya Perera passes away
Director and single largest individual shareholder of Lanka Ashok Leyland Plc’s Saliya Perera on Sunday night passed away in a private hospital after being admitted for a heart ailment.
Daily FT learns that Perera, a self-made entrepreneur and investor, got a heart attack and was rushed to the hospital, and all efforts to resuscitate him failed.
A father of two children who are overseas, Perera has been low profile though highly connected. Described as a good friend for everyone, Perera after leaving a high flying career at AirLanka, built his original wealth by supplying sand to build the World Trade Centre in Fort, followed by as a transport contractor for Holcim. Thereafter he focused fully as an investor whilst he was also an advisor to Jeevan Kumaratunga when the latter was the Minister of Sports.
Perera, recently came into limelight when Seylan Bank on 15 February force sold a 12% stake in Lanka Ashok held by him to recover dues. Perera has been a longstanding shareholder in Lanka Ashok originally with 27.85% stake amounting to one million shares. He was appointed to the Board last year.
The 12% stake sale by Seylan Bank, at Rs. 1000 per share, lower by Rs. 650 or 21% from its last closing price on 21 January had demoralised Perera, who however had previously undergone a bypass surgery. At the time of his death the balance stake of 15.85% stake was still under his name.
Illiquid Lanka Ashok’s all time high price was Rs. 4,300 achieved on 21 October whilst it closed 2010 at Rs. 4,050. This was despite its net asset per share being only Rs. 329. In 2009/10 financial year up to the first nine months, the highest was Rs. 1,500 and the lowest and closing price was Rs. 1,345.
Seylan’s exact exposure to Perera by granting credit/margin trading facility couldn’t be confirmed but some speculated it could have been around Rs. 400 million. Whilst the market faulted the Bank for selling the stake at such lower price analysts said when the block was put up for sale there weren’t any immediate buyers.
The big block of 449,500 shares at Rs. 1,000 was also done after 15 other trades starting from Rs. 1,525
and coming down to Rs. 1,200. The selling broker may have sold down to reach a pre-determined price. The block was eventually purchased by Perpetual Capital for Rs. 449.5 million.
On that day (15 February), a total of 465,500 shares of Lanka Ashok changed hands via 101 trades for Rs. 479.4 million, and closed at Rs. 2,383.30 down by Rs. 650 or 21.4% whilst its intra-day highest was Rs. 2,500. Yesterday Lanka Ashok closed at Rs. 2,650, down by Rs. 216.70.
Lanka Leyland owns 41.7% stake in the Company along with 27.85% by Ashok Leyland.
In the first nine months of 2010/11 financial; year, Lanka Ashok’s revenue was Rs. 7.7 billion, up by 311% whilst profit from operations swelled by 800% to Rs. 1.1 billion. Net profit after tax amounted to Rs. 707.8 million as against Rs. 1.5 million in the first nine months of 2009/10 financial year. Total assets doubled from Rs. 1.38 billion in 2009/10 end 3Q to Rs. 3.47 billion a year later. Earnings per share were Rs. 195, up from 42 cents in the previous financial year.
Lanka Ashok Leyland was incorporated in 1982 as a Public Limited Liability Company and started its operations in 1983 as a Joint venture between Lanka Leyland Ltd. (a wholly owned company of Government of Sri Lanka) and Ashok Leyland Ltd India, to carry out the business of importation of Ashok Leyland commercial vehicles in knock down condition or fully built and carry out assembly operations, repair and service, body building on chassis and other developments to progressively develop ancillary industries locally.
source - www.ft.lk
Daily FT learns that Perera, a self-made entrepreneur and investor, got a heart attack and was rushed to the hospital, and all efforts to resuscitate him failed.
A father of two children who are overseas, Perera has been low profile though highly connected. Described as a good friend for everyone, Perera after leaving a high flying career at AirLanka, built his original wealth by supplying sand to build the World Trade Centre in Fort, followed by as a transport contractor for Holcim. Thereafter he focused fully as an investor whilst he was also an advisor to Jeevan Kumaratunga when the latter was the Minister of Sports.
Perera, recently came into limelight when Seylan Bank on 15 February force sold a 12% stake in Lanka Ashok held by him to recover dues. Perera has been a longstanding shareholder in Lanka Ashok originally with 27.85% stake amounting to one million shares. He was appointed to the Board last year.
The 12% stake sale by Seylan Bank, at Rs. 1000 per share, lower by Rs. 650 or 21% from its last closing price on 21 January had demoralised Perera, who however had previously undergone a bypass surgery. At the time of his death the balance stake of 15.85% stake was still under his name.
Illiquid Lanka Ashok’s all time high price was Rs. 4,300 achieved on 21 October whilst it closed 2010 at Rs. 4,050. This was despite its net asset per share being only Rs. 329. In 2009/10 financial year up to the first nine months, the highest was Rs. 1,500 and the lowest and closing price was Rs. 1,345.
Seylan’s exact exposure to Perera by granting credit/margin trading facility couldn’t be confirmed but some speculated it could have been around Rs. 400 million. Whilst the market faulted the Bank for selling the stake at such lower price analysts said when the block was put up for sale there weren’t any immediate buyers.
The big block of 449,500 shares at Rs. 1,000 was also done after 15 other trades starting from Rs. 1,525
and coming down to Rs. 1,200. The selling broker may have sold down to reach a pre-determined price. The block was eventually purchased by Perpetual Capital for Rs. 449.5 million.
On that day (15 February), a total of 465,500 shares of Lanka Ashok changed hands via 101 trades for Rs. 479.4 million, and closed at Rs. 2,383.30 down by Rs. 650 or 21.4% whilst its intra-day highest was Rs. 2,500. Yesterday Lanka Ashok closed at Rs. 2,650, down by Rs. 216.70.
Lanka Leyland owns 41.7% stake in the Company along with 27.85% by Ashok Leyland.
In the first nine months of 2010/11 financial; year, Lanka Ashok’s revenue was Rs. 7.7 billion, up by 311% whilst profit from operations swelled by 800% to Rs. 1.1 billion. Net profit after tax amounted to Rs. 707.8 million as against Rs. 1.5 million in the first nine months of 2009/10 financial year. Total assets doubled from Rs. 1.38 billion in 2009/10 end 3Q to Rs. 3.47 billion a year later. Earnings per share were Rs. 195, up from 42 cents in the previous financial year.
Lanka Ashok Leyland was incorporated in 1982 as a Public Limited Liability Company and started its operations in 1983 as a Joint venture between Lanka Leyland Ltd. (a wholly owned company of Government of Sri Lanka) and Ashok Leyland Ltd India, to carry out the business of importation of Ashok Leyland commercial vehicles in knock down condition or fully built and carry out assembly operations, repair and service, body building on chassis and other developments to progressively develop ancillary industries locally.
source - www.ft.lk
Stock market fails to match World Cup excitement
In between Saturday’s World Cup quarter final victory and high hopes for today, investors failed to match the Lankan spectators’ excitement as the Bourse remained lackluster yesterday.
The benchmark All Share Index dipped by 0.4% whilst Milanka was unchanged on a day when turnover was only Rs. 1.6 billion.
“The ASPI dipped on lack of buying interest amid low retail participation where the activity levels were driven by large trades on PHAR and trades on banking and finance counters,” John Keells Stock Brokers said.
“A buying momentum during the latter half recovered indices marginally after the initial downtrend. However, ASPI closed in red while MPI managed to stay stagnant amidst interest witnessed in index heavy Commercial Bank (up Rs. 6.90 to Rs. 269.10) and John Keells Holdings (up Rs. 2.90 to Rs. 276.60),” NDB Stockbrokers said. “Prices of blue chip counters are expected to pick up in the coming few days amidst low turnover levels,” it added.
Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Commercial Bank, Sampath Bank (up Rs. 2 to Rs. 285.30) and Central Finance (up Rs. 55.70 to Rs. 1,105.70) with sector index increasing 0.65%. Stores & Supply sector also contributed to the market turnover with sector index decreasing 1.14%. Sector turnover was boosted by Colombo Pharmacy (9 crossings of 54,000 shares at Rs. 3,500) in which profit taking was witnessed after making a quick gain last Friday. The share price decreased by Rs. 31.10 (0.88%) and closed at Rs. 3,427.
Singer Sri Lanka saw its share price gain by 5% or Rs. 11 to close at Rs. 221 on the news of an enhancement in liquidity of its shares following the planned sale of 1.6% stake by subsidiary Singer Industries Plc.
Asia Securities said High net worth and retailers continued their interest in Colombo Pharmacy, making it the top contributor accounting for circa 18.7%. Bargain hunters’ presence was evident in banking sector counters where Commercial Bank and Sampath Bank registered mid-sized blocks being crossed off at Rs. 270 and Rs. 285.0 respectively. Retail chase on Central Finance extended into this trading week as well, resulting the counter in the day’s top price gainers list with a price appreciation of 5.3% to close Rs. 1,105.7. Renewed investor play was evident in Brown & Co whilst Sierra Cables continued to grab investor attention during the day.
source - www.ft.lk
The benchmark All Share Index dipped by 0.4% whilst Milanka was unchanged on a day when turnover was only Rs. 1.6 billion.
“The ASPI dipped on lack of buying interest amid low retail participation where the activity levels were driven by large trades on PHAR and trades on banking and finance counters,” John Keells Stock Brokers said.
“A buying momentum during the latter half recovered indices marginally after the initial downtrend. However, ASPI closed in red while MPI managed to stay stagnant amidst interest witnessed in index heavy Commercial Bank (up Rs. 6.90 to Rs. 269.10) and John Keells Holdings (up Rs. 2.90 to Rs. 276.60),” NDB Stockbrokers said. “Prices of blue chip counters are expected to pick up in the coming few days amidst low turnover levels,” it added.
Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Commercial Bank, Sampath Bank (up Rs. 2 to Rs. 285.30) and Central Finance (up Rs. 55.70 to Rs. 1,105.70) with sector index increasing 0.65%. Stores & Supply sector also contributed to the market turnover with sector index decreasing 1.14%. Sector turnover was boosted by Colombo Pharmacy (9 crossings of 54,000 shares at Rs. 3,500) in which profit taking was witnessed after making a quick gain last Friday. The share price decreased by Rs. 31.10 (0.88%) and closed at Rs. 3,427.
Singer Sri Lanka saw its share price gain by 5% or Rs. 11 to close at Rs. 221 on the news of an enhancement in liquidity of its shares following the planned sale of 1.6% stake by subsidiary Singer Industries Plc.
Asia Securities said High net worth and retailers continued their interest in Colombo Pharmacy, making it the top contributor accounting for circa 18.7%. Bargain hunters’ presence was evident in banking sector counters where Commercial Bank and Sampath Bank registered mid-sized blocks being crossed off at Rs. 270 and Rs. 285.0 respectively. Retail chase on Central Finance extended into this trading week as well, resulting the counter in the day’s top price gainers list with a price appreciation of 5.3% to close Rs. 1,105.7. Renewed investor play was evident in Brown & Co whilst Sierra Cables continued to grab investor attention during the day.
source - www.ft.lk
CSE down 0.42% on low retail interest
Lanka Ventures PLC subsidiary invests Rs. 384mn in 10MW wind-power project
East-West Properties sees revaluation increase asset value by Rs. 695mn
Low retail participation and lack of buying interest saw the bourse slip 0.42 percent on Monday, brokers said.
The Colombo Stock Exchange dipped 0.42 percent yesterday (28) with the All Share Price Index losing 30.18 points to close at 7,210.09 points. The Milanka Price Index of more liquid stocks gained 0.01 percent to close at 6,838.41 points, up 0.39 points, data from the exchange showed.
Turnover amounted to Rs. 1,608.5 million.
The top gainers were Gestetner of Ceylon up 24.65 percent to close at Rs. 135, SMB Leasing warrants up 20 percent to 60 cents, Asian Alliance Insurance up 13.33 percent to Rs. 170.
Nation Lanka Finance was down 15.91 percent to close at Rs. 3.70.
Colombo Pharmacy saw 84,600 shares change hands at Rs. 3,489.90 while Commercial Bank and Sampath Bank saw 542,600 shares at Rs. 269.10 and Rs. 311,828 shares at Rs. 285.30 respectively.
"The ASPI dipped on lack of buying interest amid low retail participation where the activity levels were driven by large trades on Colombo Pharmacy and trades on banking and finance counters," John Keells Stockbrokers said.
Meanwhile, East-West Properties PLC in a stock exchange filing said its assets were revalued resulting in an increase of value amounting to Rs. 694,663,496. The assets revalued were leasehold land, a condominium apartment and a warehouse. Further, it said it had leased out property valued at Rs. 634 million as at March 20, 2011 on a lease agreement which would expire in 2027.
LVL Energy Fund Private Ltd (LEF), the fully owned subsidiary of Lanka Ventures PLC, announced that it had entered into an agreement with LTL Holdings Private Ltd on March 28 2011 to set up a 10MW wind-power generation project in the Kalpitiya peninsular.
"LEF’s investment in the project will be Rs. 384 million representing an equity stake of 40 percent in the project company named ‘Pawan Danavi Private Ltd," .
source - www.island.lk
East-West Properties sees revaluation increase asset value by Rs. 695mn
Low retail participation and lack of buying interest saw the bourse slip 0.42 percent on Monday, brokers said.
The Colombo Stock Exchange dipped 0.42 percent yesterday (28) with the All Share Price Index losing 30.18 points to close at 7,210.09 points. The Milanka Price Index of more liquid stocks gained 0.01 percent to close at 6,838.41 points, up 0.39 points, data from the exchange showed.
Turnover amounted to Rs. 1,608.5 million.
The top gainers were Gestetner of Ceylon up 24.65 percent to close at Rs. 135, SMB Leasing warrants up 20 percent to 60 cents, Asian Alliance Insurance up 13.33 percent to Rs. 170.
Nation Lanka Finance was down 15.91 percent to close at Rs. 3.70.
Colombo Pharmacy saw 84,600 shares change hands at Rs. 3,489.90 while Commercial Bank and Sampath Bank saw 542,600 shares at Rs. 269.10 and Rs. 311,828 shares at Rs. 285.30 respectively.
"The ASPI dipped on lack of buying interest amid low retail participation where the activity levels were driven by large trades on Colombo Pharmacy and trades on banking and finance counters," John Keells Stockbrokers said.
Meanwhile, East-West Properties PLC in a stock exchange filing said its assets were revalued resulting in an increase of value amounting to Rs. 694,663,496. The assets revalued were leasehold land, a condominium apartment and a warehouse. Further, it said it had leased out property valued at Rs. 634 million as at March 20, 2011 on a lease agreement which would expire in 2027.
LVL Energy Fund Private Ltd (LEF), the fully owned subsidiary of Lanka Ventures PLC, announced that it had entered into an agreement with LTL Holdings Private Ltd on March 28 2011 to set up a 10MW wind-power generation project in the Kalpitiya peninsular.
"LEF’s investment in the project will be Rs. 384 million representing an equity stake of 40 percent in the project company named ‘Pawan Danavi Private Ltd," .
source - www.island.lk
Monday, March 28, 2011
Sri Lanka bourse down from near 1-week high; rupee steady
COLOMBO, March 28 (Reuters) - Sri Lankan stocks closed weaker on Monday in thin turnover from a one-week high on a sell-off and as woes over higher inflation due to instability in oil-producing regions weighed.
The island's main share index closed 0.42 percent, or 30.18 points, weaker at 7,210.09. It hit a record closing high of 7,811.82 on Feb 14.
Analysts said investor sentiment has turned negative on move by Sri Lanka's Securities and Exchange Commission to end credit transactions by end-June [ID:nSGE6AS0BD] and turmoil in oil-producing Middle Eastern and North African countries.
Foreign investors were net sellers of 78.7 million rupees worth of shares on Monday. They have sold a net 6.6 billion in 2011, after a record 26.4 billion in 2010.
O il retreated on monday with brent slipping to around $115. Brent crude for may lcoc1 fell 41 cents to $115.18 a barrel by 1028 gmt, about $5 from a 2-1/2-year high near $120 reached last month. U.s. Crude clc1 shed 63 cents to $104.77. [id: nl3e7es07y]
Sri Lanka imports all its oil, so the crises in Libya and the Middle East mean the island nation's economy could be hit by soaring inflation and a loss of earnings from Sri Lankan expatriate workers and lower tea demand from the region.
The day's turnover was 1.6 billion Sri Lanka rupees ($14.5 million), lower than last year's average of 2.4 billion rupees and well below this year's daily average of 3.3 billion.
The bourse is still Asia's best performer so far in 2011 with an 8.7 percent gain, after bringing in the region's best return of 96 percent last year.
Traded volume was 49.5 million, against a five-day average of 68.9 million shares. The 30-day and 90-day average trading volumes were 68.6 million and 69.5 million, respectively.
Last year's daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 15, one of the highest among emerging markets, compared with 12.5 in Asian markets and 11.8 in global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed steady for a fifth straight day at 110.38/40 a dollar, dealers said.
FACTORS TO WATCH:
- Impact on stocks and rupee due to ongoing Middle East/North Africa turmoil
- Impact of rising inflation on the bourse
- The extent of rupee appreciation the central bank will allow to curb imported inflation
source - in.reuters.com
The island's main share index closed 0.42 percent, or 30.18 points, weaker at 7,210.09. It hit a record closing high of 7,811.82 on Feb 14.
Analysts said investor sentiment has turned negative on move by Sri Lanka's Securities and Exchange Commission to end credit transactions by end-June [ID:nSGE6AS0BD] and turmoil in oil-producing Middle Eastern and North African countries.
Foreign investors were net sellers of 78.7 million rupees worth of shares on Monday. They have sold a net 6.6 billion in 2011, after a record 26.4 billion in 2010.
O il retreated on monday with brent slipping to around $115. Brent crude for may lcoc1 fell 41 cents to $115.18 a barrel by 1028 gmt, about $5 from a 2-1/2-year high near $120 reached last month. U.s. Crude clc1 shed 63 cents to $104.77. [id: nl3e7es07y]
Sri Lanka imports all its oil, so the crises in Libya and the Middle East mean the island nation's economy could be hit by soaring inflation and a loss of earnings from Sri Lankan expatriate workers and lower tea demand from the region.
The day's turnover was 1.6 billion Sri Lanka rupees ($14.5 million), lower than last year's average of 2.4 billion rupees and well below this year's daily average of 3.3 billion.
The bourse is still Asia's best performer so far in 2011 with an 8.7 percent gain, after bringing in the region's best return of 96 percent last year.
Traded volume was 49.5 million, against a five-day average of 68.9 million shares. The 30-day and 90-day average trading volumes were 68.6 million and 69.5 million, respectively.
Last year's daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 15, one of the highest among emerging markets, compared with 12.5 in Asian markets and 11.8 in global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed steady for a fifth straight day at 110.38/40 a dollar, dealers said.
FACTORS TO WATCH:
- Impact on stocks and rupee due to ongoing Middle East/North Africa turmoil
- Impact of rising inflation on the bourse
- The extent of rupee appreciation the central bank will allow to curb imported inflation
source - in.reuters.com
Sri Lanka revises up 2011 avg inflation to 7 pct
(Reuters) - Sri Lanka's central bank on Monday revised up its end-2011 annual average inflation target to 7 percent by December from its earlier 6 percent, but said annual inflation may moderate from May after hitting a 26-month high of 8 percent this month.
The central bank had originally expected annual average inflation of 4 to 6 percent.
"Inflation on a year-on-year basis is likely to increase to around 8 percent in March 2011, due to the low base in March 2010," the central bank said in a statement.
"Year-on-year inflation is expected to decelerate from May 2011 onwards to reach 6.0-7.0 percent by the year-end, although annual average inflation may follow an increasing trend during the balance period of the year to record around 7 percent by December 2011."
The island nation's annual inflation hit a 25-month high of 7.8 percent in February mainly due to supply disruptions in local agricultural produce after two rounds of floods in the first two months of the year. [ID:nSGE71704Q]
"Unpredictable weather conditions could impact negatively causing temporary price increases. The continuous increase in the prices of key international commodities, especially that of crude oil, could also cause a one-off increase in inflation if it is passed through to domestic consumers."
However, the central bank said the ongoing fiscal consolidation process, increase in production in a post-war regime and appreciating trend in the rupee currency LKR= are expected to mitigate inflation.
The Indian ocean island nation's $50 billion economy is estimated to have expanded 8 percent in 2010, and the central bank had estimated growth at 8.5 percent this year, the highest rate since independence in 1948, fuelled by strong post-war macroeconomic optimism. [ID:nL3E7ES14J] (Reporting by Ranga Sirilal; Editing by Shihar Aneez)
source - in.reuters.com
The central bank had originally expected annual average inflation of 4 to 6 percent.
"Inflation on a year-on-year basis is likely to increase to around 8 percent in March 2011, due to the low base in March 2010," the central bank said in a statement.
"Year-on-year inflation is expected to decelerate from May 2011 onwards to reach 6.0-7.0 percent by the year-end, although annual average inflation may follow an increasing trend during the balance period of the year to record around 7 percent by December 2011."
The island nation's annual inflation hit a 25-month high of 7.8 percent in February mainly due to supply disruptions in local agricultural produce after two rounds of floods in the first two months of the year. [ID:nSGE71704Q]
"Unpredictable weather conditions could impact negatively causing temporary price increases. The continuous increase in the prices of key international commodities, especially that of crude oil, could also cause a one-off increase in inflation if it is passed through to domestic consumers."
However, the central bank said the ongoing fiscal consolidation process, increase in production in a post-war regime and appreciating trend in the rupee currency LKR= are expected to mitigate inflation.
The Indian ocean island nation's $50 billion economy is estimated to have expanded 8 percent in 2010, and the central bank had estimated growth at 8.5 percent this year, the highest rate since independence in 1948, fuelled by strong post-war macroeconomic optimism. [ID:nL3E7ES14J] (Reporting by Ranga Sirilal; Editing by Shihar Aneez)
source - in.reuters.com
Sri Lanka shares close down 0.42-pct
Mar 28, 2011 (LBO) - Sri Lankan shares closed down Monday with continuing interest seen in a cable firm and several private deals in an asset-rich pharmaceutical retailer, brokers said.
The All Share Price Index closed at 7,210.09, down 0.42 percent (30.18 points) while the more liquid Milanka index was barely changed at 6,838.41, according to stock exchange provisional figures.
Turnover was 1.6 billion rupees.
There were nine deals of Colombo Pharmacy Company shares of 6,000 shares each amounting to 54,000 shares, all at 3,500 rupees a share, adding 189 million rupees to the day's turnover.
Colombo Pharmacy Company closed at 3,489.90 rupees, down 31.10 rupees with 84,600 shares traded altogether.
Environmental Resources Investments and fund manager Nimal Perera bought control of Colombo Pharmacy Company in September 2010.
Colombo Pharmacy has real estate holdings in key business areas in Union Place and Bambalapitiya in Colombo.
Sierra Cables was the most actively traded stock, as it had been on Friday, with the share closing at 5.50 rupees, down 40 cents with over 9.2 million shares traded.
Guardian Capital Partners was also actively traded, closing at 266.80 rupees, down 27.40 with 207,400 shares done
A stock exchange filing said Royal Ceramics Lanka, controlled by Dhammika Perera, bought 1,386,500 shares of LB Finance, which he also controls, at an average price of 188.89 rupees a share.
source - www.lbo.lk
The All Share Price Index closed at 7,210.09, down 0.42 percent (30.18 points) while the more liquid Milanka index was barely changed at 6,838.41, according to stock exchange provisional figures.
Turnover was 1.6 billion rupees.
There were nine deals of Colombo Pharmacy Company shares of 6,000 shares each amounting to 54,000 shares, all at 3,500 rupees a share, adding 189 million rupees to the day's turnover.
Colombo Pharmacy Company closed at 3,489.90 rupees, down 31.10 rupees with 84,600 shares traded altogether.
Environmental Resources Investments and fund manager Nimal Perera bought control of Colombo Pharmacy Company in September 2010.
Colombo Pharmacy has real estate holdings in key business areas in Union Place and Bambalapitiya in Colombo.
Sierra Cables was the most actively traded stock, as it had been on Friday, with the share closing at 5.50 rupees, down 40 cents with over 9.2 million shares traded.
Guardian Capital Partners was also actively traded, closing at 266.80 rupees, down 27.40 with 207,400 shares done
A stock exchange filing said Royal Ceramics Lanka, controlled by Dhammika Perera, bought 1,386,500 shares of LB Finance, which he also controls, at an average price of 188.89 rupees a share.
source - www.lbo.lk
Sri Lanka Islamic equity rules still evolving: practitioner
Mar 28, 2011 (LBO) - Islamic finance principles in Sri Lanka are still evolving and there is vigorous debate on deciding stocks compliant with Sharia or Islamic law both in the island and abroad, a practitioner has said.
Broadly under Islamic finance sectors such as gambling, non compliant meats like pork, entertainment, conventional banks or finance companies, defence, entertainment, alcohol, tobacco, pornography and even hotels are excluded.
However there is ongoing debate on what is permitted and not.
"Some scholars hold that investing in stocks is totally impossible," Ishrat Rauff, chief executive of ADL Capital, an Islamic finance firm said.
"Some scholars say defence is okay, some say tobacco is okay."
Rauff was addressing a forum organized by the Bar Association of Sri Lanka, the country's top organization representing lawyers and the Chartered Institute of Management Accountants, an accounting body.
Rauff said his firm followed guidelines set by international consensus by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), a Bahrain based industry body.
Leisure is excluded mostly because hotels serve liquor which is a key source of revenue.
Islamic finance discourages charging of interest.
Monetary history shows that before central banking, when gold and silver was money, there was no sustained inflation in the world and even bank depositors did not expect interest from banks.
Economic analysts say that modern inflating paper fiat money is not 'money' as envisaged in the past.
After the 1971 break-up of the Bretton Woods and the Federal Reserve's exit from the gold standard, today's paper money is totally backed by interest bearing credit (government Treasury bills).
Equity of banks and finance companies are specifically excluded under AAOIFI rules. Firms which get more than 5.0 percent of their revenues from non core business such as interest income have to be excluded.
Rauff said some maintain that all interest income must be excluded whatever the percentage, but when Islamic financing is still evolving it was difficult.
But investors could 'purify' the proceeds by giving the same percentage away to charity from the dividends received from the stocks. Some held that the rule should also hold to capital gains from shares, he said.
Highly leveraged institutions based on ratio of debt to market capitalization, those that have high cash balances or accounts receivables are also excluded.
Rauff said his firm used a Sharia advisor from South Africa who helped resolve debatable cases. Among recent initial public offers, Odel, PC House, Pan Asia Hydro Power were deemed to be Sharia compliant by his firm.
But firms like Singer Finance, Heladiv and Free Lanka Capital Holdings were excluded. In the case of Heladiv its ratios changed after the listing when market capitalization improved, he said.
Free Lanka Capital Holdings were excluded because of its proposed involvement in leisure. Though the firm was not yet in the business, Rauff said the firm's Sharia advisor had held that the money raised from the public offer would go to leisure.
He said the list screened by his firm would be published in the near future. The 'white list' would be revised as new information came indicating any changes in the approved businesses.
"We have to revise the list based on market capitalization and also after analyzing quarterly accounts," he said.
source - www.lbo.lk
Broadly under Islamic finance sectors such as gambling, non compliant meats like pork, entertainment, conventional banks or finance companies, defence, entertainment, alcohol, tobacco, pornography and even hotels are excluded.
However there is ongoing debate on what is permitted and not.
"Some scholars hold that investing in stocks is totally impossible," Ishrat Rauff, chief executive of ADL Capital, an Islamic finance firm said.
"Some scholars say defence is okay, some say tobacco is okay."
Rauff was addressing a forum organized by the Bar Association of Sri Lanka, the country's top organization representing lawyers and the Chartered Institute of Management Accountants, an accounting body.
Rauff said his firm followed guidelines set by international consensus by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), a Bahrain based industry body.
Leisure is excluded mostly because hotels serve liquor which is a key source of revenue.
Islamic finance discourages charging of interest.
Monetary history shows that before central banking, when gold and silver was money, there was no sustained inflation in the world and even bank depositors did not expect interest from banks.
Economic analysts say that modern inflating paper fiat money is not 'money' as envisaged in the past.
After the 1971 break-up of the Bretton Woods and the Federal Reserve's exit from the gold standard, today's paper money is totally backed by interest bearing credit (government Treasury bills).
Equity of banks and finance companies are specifically excluded under AAOIFI rules. Firms which get more than 5.0 percent of their revenues from non core business such as interest income have to be excluded.
Rauff said some maintain that all interest income must be excluded whatever the percentage, but when Islamic financing is still evolving it was difficult.
But investors could 'purify' the proceeds by giving the same percentage away to charity from the dividends received from the stocks. Some held that the rule should also hold to capital gains from shares, he said.
Highly leveraged institutions based on ratio of debt to market capitalization, those that have high cash balances or accounts receivables are also excluded.
Rauff said his firm used a Sharia advisor from South Africa who helped resolve debatable cases. Among recent initial public offers, Odel, PC House, Pan Asia Hydro Power were deemed to be Sharia compliant by his firm.
But firms like Singer Finance, Heladiv and Free Lanka Capital Holdings were excluded. In the case of Heladiv its ratios changed after the listing when market capitalization improved, he said.
Free Lanka Capital Holdings were excluded because of its proposed involvement in leisure. Though the firm was not yet in the business, Rauff said the firm's Sharia advisor had held that the money raised from the public offer would go to leisure.
He said the list screened by his firm would be published in the near future. The 'white list' would be revised as new information came indicating any changes in the approved businesses.
"We have to revise the list based on market capitalization and also after analyzing quarterly accounts," he said.
source - www.lbo.lk
Sri Lanka venture capital firm invests in wind power
Mar 28, 2011 (LBO) - Sri Lankan venture capital Lanka Ventures said it will invest 384 million rupees through a subsidiary to set up a wind power plant on the island's north-west coast.
A stock exchange filing said LVL Energy Fund (LEF), a fully-owned subsidiary of Lanka Ventures, has signed a deal with LTL Holdings to set up a 10MW wind power generation plant in the Kalpitiya peninsula.
LEF will invest 384 million rupees for an equity stake of 40 percent in the project company named Pawan Danavi, it said.
source - www.lbo.lk
2011 Budget switches off Singer Industries’ TV assembly venture
Singer Industries (Ceylon) Plc, one of the few remaining consumer electronics manufacturing entities in the country, has discontinued TV assembly venture within a year of its commencement.
Senior officials of the company said that the move was after the Government’s 2011 Budget in November imposed an unfavourable tariff structure. However prior to discontinuation the revenue from TV assembly operations was Rs. 322 million whilst it generated a profit of Rs. 8.6 million. Pre-tax profit was Rs. 17 million.
“The reduction in VAT rates caused the newly set up TV plant to be non-viable,” Singer Industries Chairman Hemaka Amarasuriya said in the Company’s 2010 Annual Report.
“Having previously experienced ‘yo yo’ effect of tariff adjustments we were cautious in out-sourcing this operation to safeguard investments from a consistently changing tariff structure. Therefore the loss on closure will be Rs. 2.3 million for fixed assets while remaining assembly components will bear a provision against further losses if any,” Amarasuriya told Singer Industries shareholders in his review.
The Company has also decided to discontinue the business activity relating to trading in televisions.
Whilst Singer Industries’ TV assembly venture got a hit with 2011 Budget moves, its parent Singer (Sri Lanka) Plc benefitted from the sale of TVs due to lowering of taxes.
Singer Sri Lanka saw a 29% growth in TV sales in 2010 whilst revenue from consumer electronics rose to Rs. 3.6 billion from Rs. 2.7 billion in 2009 whilst pre-tax profit rose from Rs. 62 million to Rs. 246.5 million in 2010.
Though Singer Industries exited TV assembly, its sewing machines business had fared better in 2010 which was attributed to revenue increasing by 37% to Rs. 664 million. Sewing machines heads rose by 27%.
Increased production volumes of sewing machines also saw Singer Industries gross profit from continuing operations at Rs. 13.5 million as against a loss of Rs. 10 million in 2009. Profit before tax was Rs. 127.7 million, as against a loss of Rs. 56 million in the previous year. However excluding the change in fair value of current investments Singer Industries incurred a pre-tax loss of Rs. 8 million. The company got a Rs. 135.8 million gain in 2010 from the change in fair value of current investments. The 1.68% stake amounting to 1.05 million shares in Singer Sri Lanka was previously recognised as a long term investment and re-classified as a current investment. The Singer Industries Board has resolved to dispose the shares hence revalued at market price.
Net profit of Singer Industries in 2010 was Rs. 118.2 million, as against a loss of Rs. 33.8 million. Together with the profit from discontinued operations the profit for 2010 amounted to Rs. 126.8 million.
However without the gain from revalued investments, the company incurred a loss of Rs. 17.6 million in 2010.
Calls for flexible labour laws
Singer Industries (Ceylon) Plc has called for more flexible and less legalistic labour laws for the manufacturing sector to remain competitive.
“While we continue to seek a balance between employee security and productivity enhancement, we are surmounted by a highly legalistic and sometimes inflexible labour law governance. We seek flexibility with regard to contractual arrangements, workforce size and functions within a basic legal framework for labour protection,” Singer Industries Chairman Hemaka Amarasuriya said.
“While we respect worker protection, this needs to be viewed with the goal of higher productivity as the Government and the country is committed towards accelerating development and achieving enhanced GDP growth rates,” he added in Singer Industries’ 2010 Annual Report.
According to Amarasuriya, who is also Chief of Singer Sri Lanka and a top business leader, labour relation systems prevailing should be consistent with and not regressive with employment development and evolvement of entrepreneurship and self-employment.
“Where our company is concerned we need the right combination of experience and apprenticeship in our labour force to be able to maintain competitiveness as the economy opens once again to lowered tariff barriers and entry cost,” Singer Industries Chief said.
“To remain a market leader we have to recognise the advent of competition within our own sphere and also from the sphere of other household appliances as the preference for household hierarchical needs change with the dynamics of our times,” Amarasuriya added.
Singer Industries which manufactures sewing machines among others as at end 2010 had 143 employees, down from 149 a year earlier.
An open-ended Voluntary Retirement Scheme remains open at Singer Industries and last year only one employee took it as opposed to 26 in 2009.
1.68% stake in Singer Sri Lanka to be sold
Singer Industries (Ceylon) Plc has resolved to divest its 1.68% stake amounting to 1.05 million shares in its parent Singer (Sri Lanka) Plc.
By virtue of this stake, Singer Industries is the second largest shareholder in Singer Sri Lanka, 86.1% of which is held by Singer Sri Lanka BV.
To prepare for the divestiture the Company had reclassified the stake as current investment from hitherto long-term investment.
The revaluation resulted in Rs. 135.8 million gain which was booked in the 2010 accounts boosting the bottom line of Singer Industries.
At last week’s closing price of Rs. 210, the stake is worth Rs. 220.5 million. Singer Sri Lanka closed gained by Rs. 7.50 last week from the previous week’s close of Rs. 202.50. End 2010 closing price was Rs. 195.
Analysts said the sale would certainly boost liquidity of Singer Sri Lanka shares in the market. Last year only 1.8 million of Singer Sri Lanka shares traded via 2,138 transactions generating a turnover of Rs. 228.7 million up from 1.28 million worth Rs. 74 million via 1,721 trades. Public holding of Singer Sri Lanka shares is only 12% whilst it has 2,673 shareholders with most (1,818) owning less than 1,000 shares. With a market capitalisation of Rs. 13.1 billion Singer Sri Lanka was ranked as the 40th most valuable stock in the Colombo Bourse.
source - www.ft.lk
Senior officials of the company said that the move was after the Government’s 2011 Budget in November imposed an unfavourable tariff structure. However prior to discontinuation the revenue from TV assembly operations was Rs. 322 million whilst it generated a profit of Rs. 8.6 million. Pre-tax profit was Rs. 17 million.
“The reduction in VAT rates caused the newly set up TV plant to be non-viable,” Singer Industries Chairman Hemaka Amarasuriya said in the Company’s 2010 Annual Report.
“Having previously experienced ‘yo yo’ effect of tariff adjustments we were cautious in out-sourcing this operation to safeguard investments from a consistently changing tariff structure. Therefore the loss on closure will be Rs. 2.3 million for fixed assets while remaining assembly components will bear a provision against further losses if any,” Amarasuriya told Singer Industries shareholders in his review.
The Company has also decided to discontinue the business activity relating to trading in televisions.
Whilst Singer Industries’ TV assembly venture got a hit with 2011 Budget moves, its parent Singer (Sri Lanka) Plc benefitted from the sale of TVs due to lowering of taxes.
Singer Sri Lanka saw a 29% growth in TV sales in 2010 whilst revenue from consumer electronics rose to Rs. 3.6 billion from Rs. 2.7 billion in 2009 whilst pre-tax profit rose from Rs. 62 million to Rs. 246.5 million in 2010.
Though Singer Industries exited TV assembly, its sewing machines business had fared better in 2010 which was attributed to revenue increasing by 37% to Rs. 664 million. Sewing machines heads rose by 27%.
Increased production volumes of sewing machines also saw Singer Industries gross profit from continuing operations at Rs. 13.5 million as against a loss of Rs. 10 million in 2009. Profit before tax was Rs. 127.7 million, as against a loss of Rs. 56 million in the previous year. However excluding the change in fair value of current investments Singer Industries incurred a pre-tax loss of Rs. 8 million. The company got a Rs. 135.8 million gain in 2010 from the change in fair value of current investments. The 1.68% stake amounting to 1.05 million shares in Singer Sri Lanka was previously recognised as a long term investment and re-classified as a current investment. The Singer Industries Board has resolved to dispose the shares hence revalued at market price.
Net profit of Singer Industries in 2010 was Rs. 118.2 million, as against a loss of Rs. 33.8 million. Together with the profit from discontinued operations the profit for 2010 amounted to Rs. 126.8 million.
However without the gain from revalued investments, the company incurred a loss of Rs. 17.6 million in 2010.
Calls for flexible labour laws
Singer Industries (Ceylon) Plc has called for more flexible and less legalistic labour laws for the manufacturing sector to remain competitive.
“While we continue to seek a balance between employee security and productivity enhancement, we are surmounted by a highly legalistic and sometimes inflexible labour law governance. We seek flexibility with regard to contractual arrangements, workforce size and functions within a basic legal framework for labour protection,” Singer Industries Chairman Hemaka Amarasuriya said.
“While we respect worker protection, this needs to be viewed with the goal of higher productivity as the Government and the country is committed towards accelerating development and achieving enhanced GDP growth rates,” he added in Singer Industries’ 2010 Annual Report.
According to Amarasuriya, who is also Chief of Singer Sri Lanka and a top business leader, labour relation systems prevailing should be consistent with and not regressive with employment development and evolvement of entrepreneurship and self-employment.
“Where our company is concerned we need the right combination of experience and apprenticeship in our labour force to be able to maintain competitiveness as the economy opens once again to lowered tariff barriers and entry cost,” Singer Industries Chief said.
“To remain a market leader we have to recognise the advent of competition within our own sphere and also from the sphere of other household appliances as the preference for household hierarchical needs change with the dynamics of our times,” Amarasuriya added.
Singer Industries which manufactures sewing machines among others as at end 2010 had 143 employees, down from 149 a year earlier.
An open-ended Voluntary Retirement Scheme remains open at Singer Industries and last year only one employee took it as opposed to 26 in 2009.
1.68% stake in Singer Sri Lanka to be sold
Singer Industries (Ceylon) Plc has resolved to divest its 1.68% stake amounting to 1.05 million shares in its parent Singer (Sri Lanka) Plc.
By virtue of this stake, Singer Industries is the second largest shareholder in Singer Sri Lanka, 86.1% of which is held by Singer Sri Lanka BV.
To prepare for the divestiture the Company had reclassified the stake as current investment from hitherto long-term investment.
The revaluation resulted in Rs. 135.8 million gain which was booked in the 2010 accounts boosting the bottom line of Singer Industries.
At last week’s closing price of Rs. 210, the stake is worth Rs. 220.5 million. Singer Sri Lanka closed gained by Rs. 7.50 last week from the previous week’s close of Rs. 202.50. End 2010 closing price was Rs. 195.
Analysts said the sale would certainly boost liquidity of Singer Sri Lanka shares in the market. Last year only 1.8 million of Singer Sri Lanka shares traded via 2,138 transactions generating a turnover of Rs. 228.7 million up from 1.28 million worth Rs. 74 million via 1,721 trades. Public holding of Singer Sri Lanka shares is only 12% whilst it has 2,673 shareholders with most (1,818) owning less than 1,000 shares. With a market capitalisation of Rs. 13.1 billion Singer Sri Lanka was ranked as the 40th most valuable stock in the Colombo Bourse.
source - www.ft.lk
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