One of the long-standing institutional shareholders, the International Finance Corporation (IFC) – the private sector investment arm of the World Bank – figured on the selling side of Commercial Bank deals, which dominated market turnover.
Slightly over 2.6 million shares of Commercial Bank traded yesterday for Rs. 704 million. Of the amount two million shares had been sold by IFC at Rs. 270 each.
As at 31 March, IFC held 33.8 million shares amounting to a 9.54% stake. Early in the week Commercial Bank’s other foreign shareholder, SBI of Japan, was also reported to be on the selling side.
Sources said that among buyers of Commercial Bank shares yesterday were institutions both local and foreign and not EPF, which was picking up available quantities early on the week.
Commercial voting share closed at Rs. 270.10, up by Rs. 2.10.
The bank on Thursday reported impressive results with profit before tax up 56% to Rs 2.96 billion for the three months ended 31 March and after tax profit up 87% to Rs. 2.06 billion. The Colombo stock market finished yet another week on a negative note. The ASI shed 20 points and MPI by 13 points yesterday. Turnover was Rs. 1.95 billion.
“Activity levels remained moderate amid some retail selling with foreign participation on COMB dominating the day’s turnover,” John Keells Stock Brokers said.
Other analysts said the Friday’s close proved Thursday’s overall good performance couldn’t be sustained. The best performing sector yesterday was Beverages, Food & Tobacco (+1.49%), whilst the worst was Motors (-3.68%), losing some of the high gains due to profit taking.
source - www.ft.lk
Saturday, April 30, 2011
Market poised to pick up with price band revision
The Securities and Exchange Commission yesterday further relaxed the controversial 10 percent price band by reducing the period of market days to which public listed companies would be placed under the 10% price from 10 market days to 5. According to a statement by the SEC, this measure was taken ‘having reviewed current market conditions’. In the lead to the Avurudu and its aftermath, the sentiments of the Colombo bourse had been damp, which eventually influenced key indices negatively.
However, the statement also said that the regulator will continue to closely monitor market behavior, especially in relation to price volatility and will consider further relaxations if deemed fit.
“The SEC may re-impose any conditions that have been relaxed so far, if the market conditions so warrant” the regulator cautioned.
The above said directive shall be effective from 29th April 2011.
In February, SEC trimmed the number of dates from original 15 to 10, including the lifting of 50 percent up front deposit requirement prior to purchase of shares (under the price band).
source - www.dailymirror.lk
However, the statement also said that the regulator will continue to closely monitor market behavior, especially in relation to price volatility and will consider further relaxations if deemed fit.
“The SEC may re-impose any conditions that have been relaxed so far, if the market conditions so warrant” the regulator cautioned.
The above said directive shall be effective from 29th April 2011.
In February, SEC trimmed the number of dates from original 15 to 10, including the lifting of 50 percent up front deposit requirement prior to purchase of shares (under the price band).
source - www.dailymirror.lk
Dr. Senthilverl ups SMB Leasing stake
In a filling to the stock exchange, SMB Leasing PLC said that Dr. T. Senthilverl has bought 4.81 million voting shares of the company at Rs. 2 per share. This in turn will increase Dr. Senthilverl’s stake to nearly 25% of issued capital of SMB Leasing.
SMB financials as at 31 December 2010 outlines that, being the largest individual shareholder of the company, Dr. T. Senthilverl held 197.3 million shares amounting 23.88% of issued share capital, and was also the second largest shareholder of SMB Leasing non voting 36 million shares amounting to 6.44%.
source - www.dailymirror.lk
SMB financials as at 31 December 2010 outlines that, being the largest individual shareholder of the company, Dr. T. Senthilverl held 197.3 million shares amounting 23.88% of issued share capital, and was also the second largest shareholder of SMB Leasing non voting 36 million shares amounting to 6.44%.
source - www.dailymirror.lk
Bourse closes week on declining mode
The Colombo bourse closed the week yesterday with both indices down and turnover nudging the Rs.2 billion mark with large transactions in Commercial Bank and Colombo Dockyard dominating business volumes together with useful contributions from Colombo Fort Land and Buildings and Pan Asia Bank.
The All Share Price Index lost 20.68 points (0.28%) while the Milanka was down 13.56 points (0.20%) on a turnover of Rs.1.95 billion, down slightly from the previous day’s Rs.2.08 billion, with 119 losers ahead of 76 gainers.
"The market quietened once again with over 2.6 million shares of Commercial Bank providing the biggest business volume," Prashan Fernando of Acuity Stockbrokers said.
"There were three crossings of ComBank at Rs.270 a share with one parcel of 1.6 million shares, one of nearly 0.3 million and another of over 0.1 million at this price. Three other crossings of a total of 500,000 shares were also done but at lower price of Rs.268."
ComBank closed Rs.2.10 up at Rs.270 with over 2.6 million shares done between Rs.268 and Rs.271 contributing Rs.704.2 million to turnover.
Dockyard was the next on the turnover league with nearly 0.5 million shares done between Rs.259 and Rs.260.10 closing flat at Rs.259 with no crossings.
Colombo Fort Land and Buildings where a five for one share split is due closed Rs.14.40 down at Rs.420 with 0.2 million shares done between Rs.420 and Rs.445. Brokers said that yesterday was the last day of trading qualifying for the share split.
Retail play was mostly seen in Colombo Fort Lands, Pan Asia Bank where over 1.5 million shares were done and Browns where over 0.1 million shares were traded.
Pan Asia saw over 1.5 million shares traded between Rs.56.10 and Rs.61.90 closing Rs.2.60 down at Rs.56.50 while Browns, with over 0.1 million shares traded between Rs.342 and Rs.355, closed Rs.2.80 down at Rs.350.
There were crossings in Royal Ceramics where over 0.1 million shares changed hands at Rs.153.70 and Reefcomber where nearly 0.9 million shares were crossed at Rs.66, brokers said.
Trans Asia announced a first and final dividend of Rs. 3 per share for 2010/11 XD from May 11 and payment on May 14 while Royal Ceramics announced a second interim dividend of Re. 1 per share for 2010/11 XD from May 11 and payment on May 20.
Pan Asia Bank announced a sub-division of each share into two doubling the number of share in issue subject to shareholder approval at a general meeting.
Ceylon Tobacco announced a first interim dividend of Rs.4.20 per share for 2011 XD from May 10 with payment on May 20 while Ceylon Cold Stores announced a first and final dividend of Rs.4 for 2010/11 XD from May 10 and payment on May 23.
source - www.island.lk
The All Share Price Index lost 20.68 points (0.28%) while the Milanka was down 13.56 points (0.20%) on a turnover of Rs.1.95 billion, down slightly from the previous day’s Rs.2.08 billion, with 119 losers ahead of 76 gainers.
"The market quietened once again with over 2.6 million shares of Commercial Bank providing the biggest business volume," Prashan Fernando of Acuity Stockbrokers said.
"There were three crossings of ComBank at Rs.270 a share with one parcel of 1.6 million shares, one of nearly 0.3 million and another of over 0.1 million at this price. Three other crossings of a total of 500,000 shares were also done but at lower price of Rs.268."
ComBank closed Rs.2.10 up at Rs.270 with over 2.6 million shares done between Rs.268 and Rs.271 contributing Rs.704.2 million to turnover.
Dockyard was the next on the turnover league with nearly 0.5 million shares done between Rs.259 and Rs.260.10 closing flat at Rs.259 with no crossings.
Colombo Fort Land and Buildings where a five for one share split is due closed Rs.14.40 down at Rs.420 with 0.2 million shares done between Rs.420 and Rs.445. Brokers said that yesterday was the last day of trading qualifying for the share split.
Retail play was mostly seen in Colombo Fort Lands, Pan Asia Bank where over 1.5 million shares were done and Browns where over 0.1 million shares were traded.
Pan Asia saw over 1.5 million shares traded between Rs.56.10 and Rs.61.90 closing Rs.2.60 down at Rs.56.50 while Browns, with over 0.1 million shares traded between Rs.342 and Rs.355, closed Rs.2.80 down at Rs.350.
There were crossings in Royal Ceramics where over 0.1 million shares changed hands at Rs.153.70 and Reefcomber where nearly 0.9 million shares were crossed at Rs.66, brokers said.
Trans Asia announced a first and final dividend of Rs. 3 per share for 2010/11 XD from May 11 and payment on May 14 while Royal Ceramics announced a second interim dividend of Re. 1 per share for 2010/11 XD from May 11 and payment on May 20.
Pan Asia Bank announced a sub-division of each share into two doubling the number of share in issue subject to shareholder approval at a general meeting.
Ceylon Tobacco announced a first interim dividend of Rs.4.20 per share for 2011 XD from May 10 with payment on May 20 while Ceylon Cold Stores announced a first and final dividend of Rs.4 for 2010/11 XD from May 10 and payment on May 23.
source - www.island.lk
US$ 50mn Lanka-Singaporean venture to develop, acquire hotel assets across the island
Sunshine Holdings PLC announced that its subsidiary Sunshine Travels & Tours Ltd has entered into a Joint Venture Agreement with Nadathur Far East Pte Ltd’s, affiliate SilverNeedle Hospitality Singapore, to develop and manage several new hotels in Sri Lanka. This Joint Venture is expected to invest approximately US$ 50 Million in a phased manner to develop, acquire and manage hotel assets in different parts of the country.
Sunshine Holdings PLC is a diversified conglomerate with interests in Healthcare, Plantations, FMCG, Packaging, Tourism, Telecom and Power. The Group with revenue exceeding US $100 Million is listed on the Colombo Stock Exchange and is ranked #35 among the LMD 50, which lists the top 50 listed Sri Lankan companies.
Beginning with the healthcare business in 1967, the group has built strong businesses over the last forty years, including partnering with the Tata Group in 1992 to form a joint venture in Plantations. Since then we have partnered with them for many of their ventures in Sri Lanka and this relationship has flourished as we share their values of ethics, transparency and integrity.
SilverNeedle Hospitality has been set up by Nadathur Fareast Pte. Ltd, an investment company founded by Mr. N S Raghavan, one of the co-founders of the Indian Software giant Infosys (Nasdaq: INFY).
SilverNeedle Hospitality, an integrated Asian hospitality company newly setup by the Nadathur Group is making investments across the hospitality sector; developing several of its own signature hotels and resorts; and is managing three, four and five star properties across Asia-Pacific. SilverNeedle plans to have over 10,000 rooms in its network, available across Asia-Pacific in 5 years, making it not just one of Asia’s largest players but also establishing the company as a global leader in the Asian hospitality industry. SilverNeedle is led by a highly experienced team which has successfully planned, developed and managed top tier brands throughout Asia.
Sunshine Travels & Tours Limited is a leading travel company providing travel services & solutions for business and leisure travelers. The company as part of its hospitality foray has commenced operation of heritage bungalows under the brand Mandira. The company aims to offer an unique holiday experience through the Mandira Bungalows, which will feature colonial style boutique bungalows in several locations around the island most with some historical significance. The company currently operates Mandira Strathdon Bungalow, Mandira Dickoya Bungalow and Mandira Craig Appen Bungalow.
source - www.island.lk
Sunshine Holdings PLC is a diversified conglomerate with interests in Healthcare, Plantations, FMCG, Packaging, Tourism, Telecom and Power. The Group with revenue exceeding US $100 Million is listed on the Colombo Stock Exchange and is ranked #35 among the LMD 50, which lists the top 50 listed Sri Lankan companies.
Beginning with the healthcare business in 1967, the group has built strong businesses over the last forty years, including partnering with the Tata Group in 1992 to form a joint venture in Plantations. Since then we have partnered with them for many of their ventures in Sri Lanka and this relationship has flourished as we share their values of ethics, transparency and integrity.
SilverNeedle Hospitality has been set up by Nadathur Fareast Pte. Ltd, an investment company founded by Mr. N S Raghavan, one of the co-founders of the Indian Software giant Infosys (Nasdaq: INFY).
SilverNeedle Hospitality, an integrated Asian hospitality company newly setup by the Nadathur Group is making investments across the hospitality sector; developing several of its own signature hotels and resorts; and is managing three, four and five star properties across Asia-Pacific. SilverNeedle plans to have over 10,000 rooms in its network, available across Asia-Pacific in 5 years, making it not just one of Asia’s largest players but also establishing the company as a global leader in the Asian hospitality industry. SilverNeedle is led by a highly experienced team which has successfully planned, developed and managed top tier brands throughout Asia.
Sunshine Travels & Tours Limited is a leading travel company providing travel services & solutions for business and leisure travelers. The company as part of its hospitality foray has commenced operation of heritage bungalows under the brand Mandira. The company aims to offer an unique holiday experience through the Mandira Bungalows, which will feature colonial style boutique bungalows in several locations around the island most with some historical significance. The company currently operates Mandira Strathdon Bungalow, Mandira Dickoya Bungalow and Mandira Craig Appen Bungalow.
source - www.island.lk
Sri Lanka stocks end down
Apr 29, 2011 (LBO) - Sri Lankan shares closed down Friday with heavy trading in the banking and finance sector, brokers said.
The main All Share Price Index closed at 7,356.97, down 0.28 percent (20.68 points) while the more liquid Milanka index fell 0.20 percent (13.56 points) to close at 6,822.77, according to stock exchange provisional figures.
Turnover was 1.95 billion rupees.
Pan Asia Bank was the most actively traded stock, closing at 56.50 rupees, down 2.60 with over 1.5 million shares done.
Pan Asia Bank said Thursday that March 2011 quarter net profit shot up 190 percent to 196 million rupees from a year ago with sharp gains in both interest and non-interest income.
Commercial Bank was also heavily traded, closing at 270.10 rupees, up 2.10 with over 2.6 million shares traded.
There were several crossings in Commercial Bank, which accounted for a big chunk of the day's turnover.
Two million shares of Commercial Bank changed hands in three deals at 270 rupees each and 500,000 shares went at 268 rupees each in three deals.
Commercial Bank reported that March 2011 quarter net profit rose 86 percent to 2,064 million rupees from a year ago as it benefited from higher interest margins and lower taxation.
Colombo Dockyard was also heavily traded. It closed flat at 260 rupees.
Lanka Securities said "weak market sentiments" prevailed during the week with little buying pressure building on indices.
The benchmark ASI dropped almost 100 points during the week while the more sensitive MPI lost 124.34 points.
Foreign participation increased slightly to 18.57 percent of the overall market activity and at the end of the week foreign selling outweighed foreign buying by 721.4 million rupees, the brokers said.
source - www.lbo.lk
The main All Share Price Index closed at 7,356.97, down 0.28 percent (20.68 points) while the more liquid Milanka index fell 0.20 percent (13.56 points) to close at 6,822.77, according to stock exchange provisional figures.
Turnover was 1.95 billion rupees.
Pan Asia Bank was the most actively traded stock, closing at 56.50 rupees, down 2.60 with over 1.5 million shares done.
Pan Asia Bank said Thursday that March 2011 quarter net profit shot up 190 percent to 196 million rupees from a year ago with sharp gains in both interest and non-interest income.
Commercial Bank was also heavily traded, closing at 270.10 rupees, up 2.10 with over 2.6 million shares traded.
There were several crossings in Commercial Bank, which accounted for a big chunk of the day's turnover.
Two million shares of Commercial Bank changed hands in three deals at 270 rupees each and 500,000 shares went at 268 rupees each in three deals.
Commercial Bank reported that March 2011 quarter net profit rose 86 percent to 2,064 million rupees from a year ago as it benefited from higher interest margins and lower taxation.
Colombo Dockyard was also heavily traded. It closed flat at 260 rupees.
Lanka Securities said "weak market sentiments" prevailed during the week with little buying pressure building on indices.
The benchmark ASI dropped almost 100 points during the week while the more sensitive MPI lost 124.34 points.
Foreign participation increased slightly to 18.57 percent of the overall market activity and at the end of the week foreign selling outweighed foreign buying by 721.4 million rupees, the brokers said.
source - www.lbo.lk
Sri Lankan tea prices fall
Apr 29, 2011 (LBO) - Larger crops following heavy rain and a drop in quality dragged down Sri Lankan tea prices at this week's Colombo auction although the biggest harvest has eliminated a crop deficit, brokers said.
"There was fair general demand mostly at lower levels for Low Grown varieties at this week’s auction," Asia Siyaka Commodities said.
Low growns make up more than half the tea crop and are cultivated mostly by small farmers.
There was fair general demand at lower rates for teas from the estates of plantation companies with the market easing further as the sale progressed, the brokers said.
Prices of some teas on the 'Western' region fell by 20-30 rupees a kilo while those from the 'Uva' region fell 40 to 50 rupees.
John Keells brokers said Sri Lanka tea crop for March at 33.3 million kilos was the highest on record, surpassing the previous best of 32.4 million kilos in 2008.
"The phenomenal crop increases in March has helped, recoup the crop deficit of 9.3 million kilos as at end-February in addition to registering a 2.9 million kilo surplus to end-March."
Frequent rains in the first quarter of the year, usually a dry period, helped increase crops.
"With such high crops presently being experienced it is unlikely that we would see a rush in the months of April and May," John Keells said.
"The large crops coupled with a drop in product quality have taken a toll on prices" at this week's sale, the brokers said.
source - www.lbo.lk
"There was fair general demand mostly at lower levels for Low Grown varieties at this week’s auction," Asia Siyaka Commodities said.
Low growns make up more than half the tea crop and are cultivated mostly by small farmers.
There was fair general demand at lower rates for teas from the estates of plantation companies with the market easing further as the sale progressed, the brokers said.
Prices of some teas on the 'Western' region fell by 20-30 rupees a kilo while those from the 'Uva' region fell 40 to 50 rupees.
John Keells brokers said Sri Lanka tea crop for March at 33.3 million kilos was the highest on record, surpassing the previous best of 32.4 million kilos in 2008.
"The phenomenal crop increases in March has helped, recoup the crop deficit of 9.3 million kilos as at end-February in addition to registering a 2.9 million kilo surplus to end-March."
Frequent rains in the first quarter of the year, usually a dry period, helped increase crops.
"With such high crops presently being experienced it is unlikely that we would see a rush in the months of April and May," John Keells said.
"The large crops coupled with a drop in product quality have taken a toll on prices" at this week's sale, the brokers said.
source - www.lbo.lk
Sri Lanka Seylan March net up 27-pct
Apr 29, 2011 (LBO) - Sri Lanka's Seylan Bank group net profits in the March 2011 quarter rose 27 percent to 195 million rupees from a year earlier, helped by loan loss provision reversals and steady margins on its fund book, interim accounts showed.
The bank reported earnings per share of 3.93 rupees for the quarter. After the balance sheet date the bank has announced a rights issue of one share for every voting and non-voting stock.
The bank said it is also proposing to change 3.39 million no-redeemable preference shares to make them redeemable, at a shareholder meeting called for in on May 09.
Interest income fell 4.8 percent to 3.85 billion rupees and interest expenses fell at a faster 12.4 percent to 2.0 billion rupees allowing net interest income rose 5.1 percent to 1.85 billion rupees.
Group fee income rose 13.3 percent to 527 million rupees. Administration expenses rose 9.2 percent to 775.5 million rupees. There was a loan loss reversal of 63.7 million rupees, though the bank made a 96 million rupee provision for loss of value of investments.
Total performing loans rose 3.7 percent to 79.2 billion rupees from December 2010.
Non-performing loans fell 3.7 percent to 24.7 billion rupees. Total deposits rose 4.6 percent to 115.8 billion rupees.
Group gross assets rose 3.4 percent to 156 billion rupees and net assets rose 1.2 percent to 13.4 billion rupees.
source - www.lbo.lk
The bank reported earnings per share of 3.93 rupees for the quarter. After the balance sheet date the bank has announced a rights issue of one share for every voting and non-voting stock.
The bank said it is also proposing to change 3.39 million no-redeemable preference shares to make them redeemable, at a shareholder meeting called for in on May 09.
Interest income fell 4.8 percent to 3.85 billion rupees and interest expenses fell at a faster 12.4 percent to 2.0 billion rupees allowing net interest income rose 5.1 percent to 1.85 billion rupees.
Group fee income rose 13.3 percent to 527 million rupees. Administration expenses rose 9.2 percent to 775.5 million rupees. There was a loan loss reversal of 63.7 million rupees, though the bank made a 96 million rupee provision for loss of value of investments.
Total performing loans rose 3.7 percent to 79.2 billion rupees from December 2010.
Non-performing loans fell 3.7 percent to 24.7 billion rupees. Total deposits rose 4.6 percent to 115.8 billion rupees.
Group gross assets rose 3.4 percent to 156 billion rupees and net assets rose 1.2 percent to 13.4 billion rupees.
source - www.lbo.lk
Sri Lanka regulator cuts restriction period for volatile stocks
Apr 29, 2011 (LBO) - Sri Lanka's Securities and Exchange Commission said it is cutting a period of trading restraints on volatile stocks to five days from an earlier ten.
"The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit," SEC said in a statement.
"However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant."
The so-called 'price band' restrains trades on stocks that show unusual price movements.
The price band was brought following concerns that many illiquid stocks in particular were extremely volatile.
source - www.lbo.lk
"The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit," SEC said in a statement.
"However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant."
The so-called 'price band' restrains trades on stocks that show unusual price movements.
The price band was brought following concerns that many illiquid stocks in particular were extremely volatile.
source - www.lbo.lk
Sri Lanka restricts bank exposure to stocks
Apr 29, 2011 (LBO) - Sri Lanka's banking regulator has imposed limits on commercial bank exposure to the stock market which has been among Asia's top performing bourses in the last two years.
New guidelines issued by the central bank limits bank lending to buy stocks to less than 05 percent of total loans, with those over the new limit required to reduce exposure by March 31, 2012.
Margin trading facilities cannot exceed 50 percent of the market value of customers' share portfolios at the close of each trading day, the central bank said in a statement.
The regulator has also imposed limits on issue of guarantees to buy shares, saying they cannot exceed fifty percent of the value of initial public offerings.
The move came after criticism that small investors were being unfairly denied a chance to invest in IPOs with a spate of recent IPOs being heavily oversubscribed by big investors using bank guarantees.
The sharp rise in stock prices has also raised fears of a stock market bubble.
"The Monetary Board is of the view that excessive exposure of banks to the stock market may expose banks to systemic risks arising from possible volatility and price bubbles of assets," the central bank statement said.
"Such risks which arise from the speculative behaviour of participants of such asset markets may adversely affect the asset quality, liquidity, profitability and capital of banks.
"Therefore, the adoption of appropriate risk management standards is necessary to mitigate such risks to prudent levels and to promote the safety and soundness of the banking system.
Under the limits on credit exposures, the total on-balance sheet credit exposure of a licensed commercial bank on facilities granted to customers or investors to buy listed shares for less than one year cannot exceed five percent of the total loans outstanding as at the end of the preceding quarter.
A bank that has given credit facilities in excess of the maximum limit imposed must not grant additional facilities and reduce the excess exposure to be within the limit of five percent by March 31, 2012.
The central bank has also imposed limits on margin trading saying banks can extend margin trading facilities provided they do not exceed fifty percent of the market value of the customer's share portfolio at the close of each trading day.
All shares bought with margin trading facilities shall be under pledge to the bank providing the margin trading facility, the central bank said.
It also imposed reporting requirements with banks having to maintain details of exposure to the stock market and reporting to the director of bank supervision by the 15th day of the month following each quarter.
The director boards of commercial banks are required to draw up risk management policies, guidelines and internal controls on exposure to stock markets and assess risk exposures on an on-going basis.
The exposure of bank subsidiaries to the stock markets must also be closely monitored.
"Banks must disclose their total credit exposure to the stock market in the 'notes to financial statements' giving amounts outstanding in relation to on-balance sheet and off-balance sheet items separately," the statement said.
source - www.lbo.lk
New guidelines issued by the central bank limits bank lending to buy stocks to less than 05 percent of total loans, with those over the new limit required to reduce exposure by March 31, 2012.
Margin trading facilities cannot exceed 50 percent of the market value of customers' share portfolios at the close of each trading day, the central bank said in a statement.
The regulator has also imposed limits on issue of guarantees to buy shares, saying they cannot exceed fifty percent of the value of initial public offerings.
The move came after criticism that small investors were being unfairly denied a chance to invest in IPOs with a spate of recent IPOs being heavily oversubscribed by big investors using bank guarantees.
The sharp rise in stock prices has also raised fears of a stock market bubble.
"The Monetary Board is of the view that excessive exposure of banks to the stock market may expose banks to systemic risks arising from possible volatility and price bubbles of assets," the central bank statement said.
"Such risks which arise from the speculative behaviour of participants of such asset markets may adversely affect the asset quality, liquidity, profitability and capital of banks.
"Therefore, the adoption of appropriate risk management standards is necessary to mitigate such risks to prudent levels and to promote the safety and soundness of the banking system.
Under the limits on credit exposures, the total on-balance sheet credit exposure of a licensed commercial bank on facilities granted to customers or investors to buy listed shares for less than one year cannot exceed five percent of the total loans outstanding as at the end of the preceding quarter.
A bank that has given credit facilities in excess of the maximum limit imposed must not grant additional facilities and reduce the excess exposure to be within the limit of five percent by March 31, 2012.
The central bank has also imposed limits on margin trading saying banks can extend margin trading facilities provided they do not exceed fifty percent of the market value of the customer's share portfolio at the close of each trading day.
All shares bought with margin trading facilities shall be under pledge to the bank providing the margin trading facility, the central bank said.
It also imposed reporting requirements with banks having to maintain details of exposure to the stock market and reporting to the director of bank supervision by the 15th day of the month following each quarter.
The director boards of commercial banks are required to draw up risk management policies, guidelines and internal controls on exposure to stock markets and assess risk exposures on an on-going basis.
The exposure of bank subsidiaries to the stock markets must also be closely monitored.
"Banks must disclose their total credit exposure to the stock market in the 'notes to financial statements' giving amounts outstanding in relation to on-balance sheet and off-balance sheet items separately," the statement said.
source - www.lbo.lk
Friday, April 29, 2011
Stock market recovers
The Colombo stock market made a welcome all round recovery yesterday with both indices up on top of healthy turnover.
After many days of mixed performance, the ASPI gained by 14 points and MPI by 20 points whilst turnover amounted to Rs. 2 billion. Foreigners continued to be net sellers largely on exit from Commercial Bank.
It said MPI recovered mainly due to the price appreciations of Commercial Bank, Pan Asia Banking Corporation and Brown & Company.
The Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Commercial Bank and Pan Asia Banking Corporation) with the sector index increasing 0.59%. Commercial Bank was the main contributor to the market turnover with a crossing of 1,000,000 shares at Rs 265. Foreign holding of the company decreased by 1,000,000 shares. The share price increased by Rs 2.20 (0.83%) and closed at Rs 268.
The Diversified sector also contributed to the market turnover (sector index decreasing 2.97%) mainly due to Colombo Fort Land.
Investors showed interest in Pan Asian Banking Corporation today with the positive interim results (recorded an operating profit of Rs 196.02 Mn-a profit growth of 190% for the quarter). The company also announced a subdivision of one share for every existing share.
Ceylon Tobacco, which was amongst the top negative contributors yesterday jumped backed to the top positive contributors list. The company announced an interim dividend of Rs 4.20 (less withholding tax) per share.
Reuters said the ASPI closed at its highest since April 21, led by financials, but retail profit taking capped the gain as investors cashed in stocks ahead of some lucrative initial public offerings.
Foreign investors sold a net 307.9 million rupees’ worth of shares. They have sold a net 8.20 billion in 2011, and a record 26.4 billion in 2010.
Turnover was 2.08 billion Sri Lanka rupees ($18.9 million), well below last year’s average of 2.4 billion and less than this year’s daily average of 3 billion.
Traded volume was 44.7 million, against a five-day average of 42.7 million. The 30-day and 90-day average trading volumes were 54.4 million and 63.7 million, respectively. Last year’s daily average volume was 67.9 million.
The bourse is still Asia’s best performer in 2011 with a 11.2 percent gain, after bringing in the region’s top return of 96 percent last year.
source - www.ft.lk
After many days of mixed performance, the ASPI gained by 14 points and MPI by 20 points whilst turnover amounted to Rs. 2 billion. Foreigners continued to be net sellers largely on exit from Commercial Bank.“Selective buying continued to push the indices higher while heavy interest was evident on banking sector counters,” John Keells Stock Brokers said.
“Indices gained today with a comparatively high turnover. ASPI gained around 50 points during early trading while MPI increased gradually,” NDB Stockbrokers added.
It said MPI recovered mainly due to the price appreciations of Commercial Bank, Pan Asia Banking Corporation and Brown & Company.
The Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Commercial Bank and Pan Asia Banking Corporation) with the sector index increasing 0.59%. Commercial Bank was the main contributor to the market turnover with a crossing of 1,000,000 shares at Rs 265. Foreign holding of the company decreased by 1,000,000 shares. The share price increased by Rs 2.20 (0.83%) and closed at Rs 268.
The Diversified sector also contributed to the market turnover (sector index decreasing 2.97%) mainly due to Colombo Fort Land.
Investors showed interest in Pan Asian Banking Corporation today with the positive interim results (recorded an operating profit of Rs 196.02 Mn-a profit growth of 190% for the quarter). The company also announced a subdivision of one share for every existing share.
Ceylon Tobacco, which was amongst the top negative contributors yesterday jumped backed to the top positive contributors list. The company announced an interim dividend of Rs 4.20 (less withholding tax) per share.
Reuters said the ASPI closed at its highest since April 21, led by financials, but retail profit taking capped the gain as investors cashed in stocks ahead of some lucrative initial public offerings.
Foreign investors sold a net 307.9 million rupees’ worth of shares. They have sold a net 8.20 billion in 2011, and a record 26.4 billion in 2010.
Turnover was 2.08 billion Sri Lanka rupees ($18.9 million), well below last year’s average of 2.4 billion and less than this year’s daily average of 3 billion.
Traded volume was 44.7 million, against a five-day average of 42.7 million. The 30-day and 90-day average trading volumes were 54.4 million and 63.7 million, respectively. Last year’s daily average volume was 67.9 million.
The bourse is still Asia’s best performer in 2011 with a 11.2 percent gain, after bringing in the region’s top return of 96 percent last year.
source - www.ft.lk
Royal Ceramics’ 2010/11 profit shines to Rs. 1.5 b
Royal Ceramics Plc has crossed the Rs. 1.5 billion mark in pre-tax profits in the just concluded 2010/11 financial year, reflecting a 54% growth over the previous year.
Net profit attributable to equity holders for the year ended 31 March 2011 was Rs. 1.459 billion, up by 51% over 2009/10 financial year. In 2010/11 earnings per share amounted to Rs. 13.17, up from Rs. 8.70
Group gross profit rose by 25% to Rs. 2.65 billion whilst gross revenue had increased by 29% to Rs. 6.4 billion in 2010/11.
In 2010/11 the bottom line had been helped by Rs. 214.3 million in other income (up from Rs. 156.7 million in the previous year) and 47% dip in finance expenses to Rs. 204 million.
In the fourth quarter Royal Ceramics had posted a Rs. 439.6 million net profit as against Rs. 314.2 million a year earlier. Pre-tax profit for the 4Q was Rs. 448.8 million up from Rs. 330.5 million in the 4Q of 2009/10. Group revenue rose to Rs. 1.7 billion from Rs. 1.49 billion in the 4Q of 2009/10/
At company level in 4Q after-tax profit was Rs. 851.8 million for the 4Q, up by 96% supported by Rs. 800 million in other operating income (up from Rs. 447.7 million in 4Q of 2009/10) whilst gross revenue rose by 43% to Rs. 660.6 million.
Group assets as at 31 March 2011 amounted to Rs. 8.48 billion, up from Rs. 6.48 billion a year ago. The Group had retained earnings of Rs. 3.6 billion, up from Rs. 2.6 billion in 2009/10.
Nimal enters Serendib with 3% stake for Rs. 57.4 m; share price gains
High networth individual investor Nimal Perera yesterday entered the Serendib Hotels by picking up a 3% stake for Rs. 57.4 million.
The stake, amounting to 0.41 million voting shares, was done at Rs. 140 each. Immediately after the buy, Serendib share price shot up to Rs. 160 and to a peak of Rs. 172 before closing at Rs. 168.90, up by Rs. 8.90 with 479,200 shares traded. The 52-week highest price of Serendib, which is part of Hemas Group, is Rs. 185.
Serendib Hotels Plc is closed until 15 November for refurbishment with an investment of Rs. 650 million, after which it will be repositioned as a design hotel. Funds for expansion will be sourced via Rs. 501 million in the form of equity.
Serendib has announced a one for four rights issue preceded by a sub division of five into one. These are for both voting and nonvoting shares. Voting rights issue were priced at Rs. 24.50 each and nonvoting at Rs. 18.25 each.
Hotel Serendib in Bentota was themed on an 18th Century Dutch village by Sri Lanka’s world famous architect Geoffrey Bawa. It has 90 rooms including 44 standard rooms, 42 superior rooms and one suite.
source - www.ft.lk
Net profit attributable to equity holders for the year ended 31 March 2011 was Rs. 1.459 billion, up by 51% over 2009/10 financial year. In 2010/11 earnings per share amounted to Rs. 13.17, up from Rs. 8.70
Group gross profit rose by 25% to Rs. 2.65 billion whilst gross revenue had increased by 29% to Rs. 6.4 billion in 2010/11.
In 2010/11 the bottom line had been helped by Rs. 214.3 million in other income (up from Rs. 156.7 million in the previous year) and 47% dip in finance expenses to Rs. 204 million.
In the fourth quarter Royal Ceramics had posted a Rs. 439.6 million net profit as against Rs. 314.2 million a year earlier. Pre-tax profit for the 4Q was Rs. 448.8 million up from Rs. 330.5 million in the 4Q of 2009/10. Group revenue rose to Rs. 1.7 billion from Rs. 1.49 billion in the 4Q of 2009/10/
At company level in 4Q after-tax profit was Rs. 851.8 million for the 4Q, up by 96% supported by Rs. 800 million in other operating income (up from Rs. 447.7 million in 4Q of 2009/10) whilst gross revenue rose by 43% to Rs. 660.6 million.
Group assets as at 31 March 2011 amounted to Rs. 8.48 billion, up from Rs. 6.48 billion a year ago. The Group had retained earnings of Rs. 3.6 billion, up from Rs. 2.6 billion in 2009/10.
Nimal enters Serendib with 3% stake for Rs. 57.4 m; share price gains
High networth individual investor Nimal Perera yesterday entered the Serendib Hotels by picking up a 3% stake for Rs. 57.4 million.
The stake, amounting to 0.41 million voting shares, was done at Rs. 140 each. Immediately after the buy, Serendib share price shot up to Rs. 160 and to a peak of Rs. 172 before closing at Rs. 168.90, up by Rs. 8.90 with 479,200 shares traded. The 52-week highest price of Serendib, which is part of Hemas Group, is Rs. 185.
Serendib Hotels Plc is closed until 15 November for refurbishment with an investment of Rs. 650 million, after which it will be repositioned as a design hotel. Funds for expansion will be sourced via Rs. 501 million in the form of equity.
Serendib has announced a one for four rights issue preceded by a sub division of five into one. These are for both voting and nonvoting shares. Voting rights issue were priced at Rs. 24.50 each and nonvoting at Rs. 18.25 each.
Hotel Serendib in Bentota was themed on an 18th Century Dutch village by Sri Lanka’s world famous architect Geoffrey Bawa. It has 90 rooms including 44 standard rooms, 42 superior rooms and one suite.
source - www.ft.lk
Peace, informal sector to boost Sri Lanka '11 tourism 20 pct
By Shihar Aneez
COLOMBO (Reuters) - Tourist arrivals into Sri Lanka are expected to grow by 20 percent to a record of more than 780,000 this year, thanks to growing homestays and apartment rentals to accommodate a post-war influx of visitors after the end of a 25-year civil war.
The Indian Ocean island, once referred as one of the more dangerous tourist destinations due to occasional bomb blasts during its conflict with the separatist Tamil Tigers, has attracted more than 250,000 foreign visitors so far this year.
Arrivals have surged 34 percent in the first three months after the island, famous for white-sand beaches, attracted a record 654,476 tourists last year, boosting foreign exchange earned from the industry to a record $575.9 million.
"This is higher than the original projections," Nalaka Godahewa, the head of Sri Lanka Tourism Authority, told Reuters in an interview, referring to the first quarter arrivals.
Tourism is one of the main foreign exchange earners for Sri Lanka's $50 billion economy along with remittances from abroad, garments and tea.
"This year we estimate about 20 percent growth given that World Tourism Organisation projections for the Asia Pacific region would be around 11 percent," Godahewa said.
The 20 percent surge will see post-war Sri Lanka receiving a more-than-expected 785,372 tourists in 2011, he said.
Though existing bed capacity can cater for 900,000 tourists yearly, the Tourism Authority has acknowledged that it should be increased rapidly to attract high-spending tourists with a goal of 2.5 million tourists a year and $2.5 billion revenue by 2016.
MORE BEDS COMING
More than 2,500 hotel rooms are currently under construction, and 3,000 more are pending approval, Godahewa said. Sri Lanka has 22,735 hotel rooms and 1,500 rooms will undergo refurbishment this year.
The country has also attracted nearly $1 billion of foreign investment for a 500-room hotel by Hong Kong-listed hotel operator Shangri-La Asia Ltd (0069.HK) and a shopping mall.
"A hotel like Shangri-La will raise the benchmark in terms of quality of the product and the service delivery which will help further improving the image of the industry," Godahewa said.
But in the absence of new beds at hotels, other alternatives are springing up to cater for both tourists and expatriate Sri Lankans coming home to visit.
"An informal sector of tourist accommodation is growing which includes solutions such as homestay programmes, apartments and staying with friends and relatives," he said.
Godahewa forecast this year's revenue to be around $600 million, only a 4.2 percent gain year-on-year as the room rates garnered from the informal sector are less than standard ones.
Sri Lanka in 2011 has imposed $20 tax per room night on five-star hotels if they fail to charge a minimum rate of $125.
Despite ambitious plan, Godahewa said land acquisition for investment has been slower than expected, since most of the areas identified for development have not yet been released by the relevant government authorities.
The Ministry of Economic Development is primarily focusing on a few projects in the range of $200-500 million each. Sri Lanka aims to attract $2.7 billion into tourism investments.
source - www.reuters.com/
COLOMBO (Reuters) - Tourist arrivals into Sri Lanka are expected to grow by 20 percent to a record of more than 780,000 this year, thanks to growing homestays and apartment rentals to accommodate a post-war influx of visitors after the end of a 25-year civil war.
The Indian Ocean island, once referred as one of the more dangerous tourist destinations due to occasional bomb blasts during its conflict with the separatist Tamil Tigers, has attracted more than 250,000 foreign visitors so far this year.
Arrivals have surged 34 percent in the first three months after the island, famous for white-sand beaches, attracted a record 654,476 tourists last year, boosting foreign exchange earned from the industry to a record $575.9 million.
"This is higher than the original projections," Nalaka Godahewa, the head of Sri Lanka Tourism Authority, told Reuters in an interview, referring to the first quarter arrivals.
Tourism is one of the main foreign exchange earners for Sri Lanka's $50 billion economy along with remittances from abroad, garments and tea.
"This year we estimate about 20 percent growth given that World Tourism Organisation projections for the Asia Pacific region would be around 11 percent," Godahewa said.
The 20 percent surge will see post-war Sri Lanka receiving a more-than-expected 785,372 tourists in 2011, he said.
Though existing bed capacity can cater for 900,000 tourists yearly, the Tourism Authority has acknowledged that it should be increased rapidly to attract high-spending tourists with a goal of 2.5 million tourists a year and $2.5 billion revenue by 2016.
MORE BEDS COMING
More than 2,500 hotel rooms are currently under construction, and 3,000 more are pending approval, Godahewa said. Sri Lanka has 22,735 hotel rooms and 1,500 rooms will undergo refurbishment this year.
The country has also attracted nearly $1 billion of foreign investment for a 500-room hotel by Hong Kong-listed hotel operator Shangri-La Asia Ltd (0069.HK) and a shopping mall.
"A hotel like Shangri-La will raise the benchmark in terms of quality of the product and the service delivery which will help further improving the image of the industry," Godahewa said.
But in the absence of new beds at hotels, other alternatives are springing up to cater for both tourists and expatriate Sri Lankans coming home to visit.
"An informal sector of tourist accommodation is growing which includes solutions such as homestay programmes, apartments and staying with friends and relatives," he said.
Godahewa forecast this year's revenue to be around $600 million, only a 4.2 percent gain year-on-year as the room rates garnered from the informal sector are less than standard ones.
Sri Lanka in 2011 has imposed $20 tax per room night on five-star hotels if they fail to charge a minimum rate of $125.
Despite ambitious plan, Godahewa said land acquisition for investment has been slower than expected, since most of the areas identified for development have not yet been released by the relevant government authorities.
The Ministry of Economic Development is primarily focusing on a few projects in the range of $200-500 million each. Sri Lanka aims to attract $2.7 billion into tourism investments.
source - www.reuters.com/
Less play as price band cut to five days
THE Securities and Exchange Commission (SEC) said yesterday that the duration of the price band will be reduced to five market days from the previous 10 market days.
The move is effective from today.
The capital markets regulator said having reviewed the current market conditions, the Commissioners at the Commission’s 277th meeting held on Wednesday decided to further reduce the period of market days to which public listed companies would be placed under the 10% price band as a consequence of being captured under the formula (designed by the Colombo Stock Exchange and confirmed by the SEC) from 10 market days to five market days.
“The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit.
However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant,” the regulator said in a statement.
At present three companies – Alufab, Huejay and Beruwela Walk Inn – are under the band.
source - www.ft.lk
The move is effective from today.
The capital markets regulator said having reviewed the current market conditions, the Commissioners at the Commission’s 277th meeting held on Wednesday decided to further reduce the period of market days to which public listed companies would be placed under the 10% price band as a consequence of being captured under the formula (designed by the Colombo Stock Exchange and confirmed by the SEC) from 10 market days to five market days.
“The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit.
However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant,” the regulator said in a statement.
At present three companies – Alufab, Huejay and Beruwela Walk Inn – are under the band.
source - www.ft.lk
Will GREG come out with good news?
By Jithendra Antonio
Though there was speculation that one time hot stock, Environmental Resources Investment PLC (GREG) is under investigation by the regulator, Mirror Business learns that GREG is yet to receive a letter from SEC officials clarifying the investigation’s status.
The SEC sources revealed that during 277th Commission Meeting held on Wednesday 27th April 2011, SEC has finalized the matter about GREG and the company is expected to come out with the news. “GREG has requested a letter from SEC asking to clarify whether there was an investigation on the company or not, and the status of the investigation so that they can verify it to the market,” an industry source told Mirror Business in the grounds of anonymity.
“The issue had been dragging for nearly two months in the SEC’s commission meeting agendas, while in the previous meeting, the SEC official who was supposed to present the case was absent,’ the source added.
However, when Mirror Business inquired about the GREG investigation situation from SEC Director General Malik Cader he said he cannot divulge matters discussed at Commission Meetings, as they are price-sensitive issues.
“We have presented the case and deliberated it. That’s all I can tell you,” another SEC official said.
source - www.dailymirror.lk
Market poised to pick up with price band revision
The Securities and Exchange Commission yesterday further relaxed the controversial 10 percent price band by reducing the period of market days to which public listed companies would be placed under the 10% price from 10 market days to 5. According to a statement by the SEC, this measure was taken ‘having reviewed current market conditions’. In the lead to the Avurudu and its aftermath, the sentiments of the Colombo bourse had been damp, which eventually influenced key indices negatively.
However, the statement also said that the regulator will continue to closely monitor market behavior, especially in relation to price volatility and will consider further relaxations if deemed fit.
“The SEC may re-impose any conditions that have been relaxed so far, if the market conditions so warrant” the regulator cautioned.
The above said directive shall be effective from 29th April 2011.
In February, SEC trimmed the number of dates from original 15 to 10, including the lifting of 50 percent up front deposit requirement prior to purchase of shares (under the price band).
source - www.dailymirror.lk
However, the statement also said that the regulator will continue to closely monitor market behavior, especially in relation to price volatility and will consider further relaxations if deemed fit.
“The SEC may re-impose any conditions that have been relaxed so far, if the market conditions so warrant” the regulator cautioned.
The above said directive shall be effective from 29th April 2011.
In February, SEC trimmed the number of dates from original 15 to 10, including the lifting of 50 percent up front deposit requirement prior to purchase of shares (under the price band).
source - www.dailymirror.lk
Sunshine joins SilverNeedle Hospitality
Sunshine Holdings PLC yesterday announced that its subsidiary Sunshine Travels and Tours Ltd has entered into a joint venture agreement with Nadathur Fareast Pte Ltd's, affiliate SilverNeedle Hospitality Singapore, to develop and manage several new hotels in Sri Lanka.
This joint venture is expected to invest approximately US $ 50 million in a phased manner to develop, acquire and manage hotel assets in different parts of the country.
SilverNeedle Hospitality has been set up by Nadathur Fareast Pte. Ltd, an investment company founded by N S Raghavan, one of the co-founders of the Indian software giant Infosys (Nasdaq: INFY). SilverNeedle Hospitality, an integrated Asian hospitality company newly setup by the Nadathur Group is making investments across the hospitality sector; developing several of its own signature hotels and resorts; and is managing three, four and five star properties across Asia-Pacific.
source - www.dailynews.lk
This joint venture is expected to invest approximately US $ 50 million in a phased manner to develop, acquire and manage hotel assets in different parts of the country.
SilverNeedle Hospitality has been set up by Nadathur Fareast Pte. Ltd, an investment company founded by N S Raghavan, one of the co-founders of the Indian software giant Infosys (Nasdaq: INFY). SilverNeedle Hospitality, an integrated Asian hospitality company newly setup by the Nadathur Group is making investments across the hospitality sector; developing several of its own signature hotels and resorts; and is managing three, four and five star properties across Asia-Pacific.
source - www.dailynews.lk
Price band for only in five days
The Securities and Exchange Commission of Sri Lanka (SEC) at its 277th meeting held on Wednesday has decided to further reduce the period of market days to which public listed companies would be placed under the 10 percent price band as a consequence of being captured under the formula from 10 market days to five market days.
The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit. However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant, a SEC press release said.
Therefore the Colombo Stock Exchange is hereby directed henceforth to subject public listed companies captured under the aforesaid formula to a 10 percent price band for five market days only until further notice. The said directive will be effective today.
source - www.dailynews.lk
The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit. However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant, a SEC press release said.
Therefore the Colombo Stock Exchange is hereby directed henceforth to subject public listed companies captured under the aforesaid formula to a 10 percent price band for five market days only until further notice. The said directive will be effective today.
source - www.dailynews.lk
Market trades in green
Share market traded in green yesterday but with relinquished gains.
ASI gained 13.87 points (+0.19 percent) and closed at 7,377.65 while the sensitive MPI gained 19.96 points (+0.29 percent) to close at 6,836.33.
The market turnover stood at Rs 2.1billion. Commercial Bank Plc (Rs.265.5 mn) was the top contributor to the turnover. One million shares of Commercial Bank changed hands yesterday as a crossing at Rs 265.00 per share. In addition Colombo Fort Land and Building Plc (Rs 218.1 mn) and Pan Asia Bank (Rs 193.4 mn) made noteworthy contributions to the daily turnover. Pan Asia Bank Plc (PABC) has announced a sub division of shares on the basis of one ordinary share for every existing issued one share. The counter was trading heavily with significant gains during trading hours. PABC closed Rs 60.00, up Rs 7.20.
ASI gained 13.87 points (+0.19 percent) and closed at 7,377.65 while the sensitive MPI gained 19.96 points (+0.29 percent) to close at 6,836.33.
The market turnover stood at Rs 2.1billion. Commercial Bank Plc (Rs.265.5 mn) was the top contributor to the turnover. One million shares of Commercial Bank changed hands yesterday as a crossing at Rs 265.00 per share. In addition Colombo Fort Land and Building Plc (Rs 218.1 mn) and Pan Asia Bank (Rs 193.4 mn) made noteworthy contributions to the daily turnover. Pan Asia Bank Plc (PABC) has announced a sub division of shares on the basis of one ordinary share for every existing issued one share. The counter was trading heavily with significant gains during trading hours. PABC closed Rs 60.00, up Rs 7.20. Meanwhile, Free Lanka Capital Holdings Plc, Brown and Company Plc and Lankem Ceylon Plc were actively traded during trading.
Foreign participation was 13.05 percent of the total market activity. At the end of the day, foreign investors were the net sellers with a net foreign outflow of Rs 307.9 million. Lanka Securities Research
source - www.dailynews.lk
Retailers help bourse to look up
Both indices on the Colombo bourse were up yesterday while turnover topped the Rs.2 billion mark after several days with substantial retail play evident in companies of the Colombo Fort Land and Buildings group and some others, broker’s said.
The All Share Price index was up 13.87 points (0.19%) and the Milanka up 19.96 points (0.29%) with 94 gainers slightly ahead of 90 losers on a turnover of Rs.2.08 billion, up from the previous day’s Rs.1.32 billion.
``The market was a little more active than in recent days," Prashan Fernando of Acuity Stockbrokers said. "The main action was on Commercial Bank where there was a crossing of a million shares at a price of Rs.265 with no word on the buyer or seller."
ComBank closed Rs.2.20 up at Rs.268 with slightly over a million shares traded. All these trades – just three excluding the crossing – were small parcels at a price of Rs.268.
Retail play was seen in Colombo Fort Lands, E.B. Creasy, Lankem Ceylon, Pan Asia, Browns and Serendib Hotels, brokers said.
Colombo Fort Lands closed Rs.8.20 up at Rs.432.10 on nearly 0.5 million shares done between Rs.432.10 and Rs.460 generating the day’s second highest turnover of Rs.218.1 million behind Commercial Bank’s Rs.265.5 million.
Pan Asia Bank too gained Rs.6.30 to close at Rs.60 on nearly 3.4 million shares done between Rs.53 and Rs.60 while Browns was up Rs.12.40 to close at Rs.347 on nearly 0.5 million shares traded between Rs.338.10 and Rs.359.
Serendib Hotels, with speculation of a share split, gained Rs.8.90 to close at Rs.165 with 0.5 million shares done between Rs.140 and Rs.172.
Lankem Ceylon was up Rs.13.70 to Rs.520 on nearly 0.3 million shares done between Rs.515 and Rs.540 while Aitken Spence gained 60 cents to close at Rs.163 on over 0.8 million shares done between Rs.163 and Rs.166.
Spence Hotels too was up Rs.8.90 to close at Rs.165 on nearly 0.5 million shares done between Rs.140 and Rs.172.
E.B. Creasy lost Rs.56.50 to close at Rs.3,000 on 16,000 shares while Ceylon Guardian was down a rupee to close at Rs.384 on 0.1 million shares. Central Finance gained Rs.11.70 to close at Rs.1, 435 on 28,300 shares.
source - www.island.lk
The All Share Price index was up 13.87 points (0.19%) and the Milanka up 19.96 points (0.29%) with 94 gainers slightly ahead of 90 losers on a turnover of Rs.2.08 billion, up from the previous day’s Rs.1.32 billion.
``The market was a little more active than in recent days," Prashan Fernando of Acuity Stockbrokers said. "The main action was on Commercial Bank where there was a crossing of a million shares at a price of Rs.265 with no word on the buyer or seller."
ComBank closed Rs.2.20 up at Rs.268 with slightly over a million shares traded. All these trades – just three excluding the crossing – were small parcels at a price of Rs.268.
Retail play was seen in Colombo Fort Lands, E.B. Creasy, Lankem Ceylon, Pan Asia, Browns and Serendib Hotels, brokers said.
Colombo Fort Lands closed Rs.8.20 up at Rs.432.10 on nearly 0.5 million shares done between Rs.432.10 and Rs.460 generating the day’s second highest turnover of Rs.218.1 million behind Commercial Bank’s Rs.265.5 million.
Pan Asia Bank too gained Rs.6.30 to close at Rs.60 on nearly 3.4 million shares done between Rs.53 and Rs.60 while Browns was up Rs.12.40 to close at Rs.347 on nearly 0.5 million shares traded between Rs.338.10 and Rs.359.
Serendib Hotels, with speculation of a share split, gained Rs.8.90 to close at Rs.165 with 0.5 million shares done between Rs.140 and Rs.172.
Lankem Ceylon was up Rs.13.70 to Rs.520 on nearly 0.3 million shares done between Rs.515 and Rs.540 while Aitken Spence gained 60 cents to close at Rs.163 on over 0.8 million shares done between Rs.163 and Rs.166.
Spence Hotels too was up Rs.8.90 to close at Rs.165 on nearly 0.5 million shares done between Rs.140 and Rs.172.
E.B. Creasy lost Rs.56.50 to close at Rs.3,000 on 16,000 shares while Ceylon Guardian was down a rupee to close at Rs.384 on 0.1 million shares. Central Finance gained Rs.11.70 to close at Rs.1, 435 on 28,300 shares.
source - www.island.lk
SEC reduces price band duration
Having reviewed the current market conditions, the Securities and Exchange Commission of Sri Lanka (SEC) at its 277th meeting held on 27th April 2011 has decided to further reduce the period of market days to which public listed companies would be placed under the 10% price band as a consequence of being captured under the formula (designed by the Colombo Stock Exchange and confirmed by the SEC) from 10 market days to 5 market days, the capital market watchdog said in a statement yesterday (28).
"The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit. However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant.
"Therefore the Colombo Stock Exchange is hereby directed henceforth to subject public listed companies captured under the above said formula to a 10% price band for 5 market days only until further notice.
"The above said directive shall be effective from 29th April 2011," the SEC said.
source - www.island.lk
"The SEC will continue to closely monitor market conduct, especially in relation to the price volatility in the market and will consider further relaxations if deemed fit. However the SEC may re-impose any conditions that have been relaxed so far if the market conditions so warrant.
"Therefore the Colombo Stock Exchange is hereby directed henceforth to subject public listed companies captured under the above said formula to a 10% price band for 5 market days only until further notice.
"The above said directive shall be effective from 29th April 2011," the SEC said.
source - www.island.lk
Sampath records 60.9 % ptp growth
The bank's pre-tax profit which rose to Rs 1,348.6 million in the first quarter 2011, reflected an increase of Rs 557.1 million or 70.4 percent over the pre-tax profit of Rs 791.5 million for the first quarter 2010. The post-tax profit (PTP)of the Bank recorded a growth of 60.9 percent over the same period of last year, rising from Rs 558.6 million in 2010 to Rs 898.8 million in 2011.
Financial results of the Sampath Bank Group, which consists of the bank and four subsidiary companies, were even better. Pre-Tax Profit of Rs 1,460.8 million of the Group for the first quarter 2011 was a growth of Rs 608.3 million or 71.3 percent, over the previous year's pre-tax profit of Rs 852.5 million, with Sampath Bank contributing 92 percent of the profit, as the main entity of the Group. The post-tax profit of the Group amounted to Rs 992.5 million, recording a growth of Rs 380.0 million or 64.2 percent, over the post-tax profit of Rs 604.5 million for the last year. Marked improvements in the performance of all four subsidiary companies during the period under review facilitated recording this higher profit growth rate at the group level in 2011.
Increased economic activity in the market and the rapid growth of 42.2 percent achieved by the Bank in its lending activities during the one year period ended March 31, 2011, paved the way for generating a higher fee-based and commission income, which recorded a significant growth of Rs 216.1 million or 45.6 percent in the first quarter 2011 over the same period in 2010.
Nevertheless, the exchange income recorded a negative growth (1.3 percent) in 2011, largely due to the revaluation loss of Rs 36.9 million, incurred in 2011 on the FCBU's retained profits, as against the revaluation loss of Rs 26.0 million incurred in 2010. This was solely due to the appreciation of Sri Lankan Rupee against the US Dollar, from Rs 113.95 as at March 31, 2010 to Rs 110.40 as at March 31, 2011.
The bank was also very successful in managing the net charge on loan losses in 2011. As a result of the bank's improving credit quality (as indicated by the reducing NPL volumes and NPL Ratios, it was possible to reduce the provisions made on specific loan losses to Rs 153.2 million. in 2011, (even with additional provisions totaling to Rs 100.0 million included therein), as against Rs 702.6 million made in 2010, which too was inclusive of additional provisions totaling to Rs 517.4 million. These additional specific loan loss provisions were made in line with the bank's policy of making such provisions against identified NPLs, ignoring the collateral held, aimed at improving the Provision Cover of the bank. As the bank achieved a Provision Coverage Ratio of 88.9 percent as at December 31, 2010, the need for such additional provisions was naturally low in 2011.
source - www.dailynews.lk
Thursday, April 28, 2011
Sri Lanka Com Bank March net up 86-pct
Apr 28, 2011 (LBO) - Sri Lanka's Commercial Bank said March 2011 quarter net profit rose 86 percent to 2,064 million rupees from a year ago as it benefited from higher interest margins and lower taxation.
Group interest income grew 5.38 percent 8.8 billion rupees while interest expenses fell 6.21 percent to 4.5 billion rupees, enabling net interest income to rise 21 percent to 4.3 billion rupees.
"Noteworthy volume increases in its performing loan book and in other principal banking activities in a period of relatively lower taxation enabled Commercial Bank to maintain its pace of growth in the first quarter of 2011," a statement said.
According to interim results filed with the stock exchange, the bank's non-interest income rose 18 percent to 1.5 billion rupees in March 2011 from a year ago.
Diluted earnings per share rose 86 percent to 5.44 rupees.
Total performing loans grew almost three percent to 219 billion rupees as at March 31, 2011 from the beginning of the year while total deposits grew almost six percent to 275 billion rupees.
The bank statement said interest income from loans grew by 864.1 million rupees or 15.69 percent to 6.371 billion, contributing to net interest income of the bank growing 20.83 percent to 4.3 billion rupees.
"Post-tax profit growth was boosted further by a reduction in the income tax rate from the 35 percent that prevailed last year to 28 percent, resulting in tax expenses increasing by only 13.78 percent to 899 million rupees for the three months."
Commercial Bank Managing Director Amitha Gooneratne said market conditions were "more conducive" for the banking sector than they were a year ago.
Total deposits of the bank grew at an average of nearly five billion rupees a month in the three months reviewed.
"Despite this significant increase, the comparatively lower interest rate regime that prevailed in the quarter resulted in total interest expenses declining by 6.21 percent, enabling the bank to improve its net interest margin to 4.59 percent from 4.43 percent a year ago," the statement said.
Other income of the bank comprising principally of commission income and income from investments rose 22.53 percent, while foreign exchange income improved by 11.32 percent on a relatively higher volume of transactions.
Net provisions on account of bad and doubtful debts decreased by 251.9 million rupees over the corresponding quarter of the previous year.
This was largely due to the Central Bank mandated reversal of part of the statutory general provision on the performing and overdue loans portfolio of commercial banks.
The provision, computed at 0.9 per cent as at December 31, 2010, was reduced to 0.8 percent at end of the quarter under review and will be further reduced by 0.1 percent each quarter to reach 0.5 percent by the end of 2011.
"These contributions helped the bank to record an increase in total income of 777.4 million rupees or 7.92 percent to 10.591 billion rupees for the three months," the statement said.
An improvement of 95.9 million rupees in recoveries on non-performing loans in the quarter also contributed to the reduction in net provisions on bad debts.
The bank’s annualized Return on Equity increased from 17.87 percent to 24.66 percent.
source - www.lbo.lk
Group interest income grew 5.38 percent 8.8 billion rupees while interest expenses fell 6.21 percent to 4.5 billion rupees, enabling net interest income to rise 21 percent to 4.3 billion rupees.
"Noteworthy volume increases in its performing loan book and in other principal banking activities in a period of relatively lower taxation enabled Commercial Bank to maintain its pace of growth in the first quarter of 2011," a statement said.
According to interim results filed with the stock exchange, the bank's non-interest income rose 18 percent to 1.5 billion rupees in March 2011 from a year ago.
Diluted earnings per share rose 86 percent to 5.44 rupees.
Total performing loans grew almost three percent to 219 billion rupees as at March 31, 2011 from the beginning of the year while total deposits grew almost six percent to 275 billion rupees.
The bank statement said interest income from loans grew by 864.1 million rupees or 15.69 percent to 6.371 billion, contributing to net interest income of the bank growing 20.83 percent to 4.3 billion rupees.
"Post-tax profit growth was boosted further by a reduction in the income tax rate from the 35 percent that prevailed last year to 28 percent, resulting in tax expenses increasing by only 13.78 percent to 899 million rupees for the three months."
Commercial Bank Managing Director Amitha Gooneratne said market conditions were "more conducive" for the banking sector than they were a year ago.
Total deposits of the bank grew at an average of nearly five billion rupees a month in the three months reviewed.
"Despite this significant increase, the comparatively lower interest rate regime that prevailed in the quarter resulted in total interest expenses declining by 6.21 percent, enabling the bank to improve its net interest margin to 4.59 percent from 4.43 percent a year ago," the statement said.
Other income of the bank comprising principally of commission income and income from investments rose 22.53 percent, while foreign exchange income improved by 11.32 percent on a relatively higher volume of transactions.
Net provisions on account of bad and doubtful debts decreased by 251.9 million rupees over the corresponding quarter of the previous year.
This was largely due to the Central Bank mandated reversal of part of the statutory general provision on the performing and overdue loans portfolio of commercial banks.
The provision, computed at 0.9 per cent as at December 31, 2010, was reduced to 0.8 percent at end of the quarter under review and will be further reduced by 0.1 percent each quarter to reach 0.5 percent by the end of 2011.
"These contributions helped the bank to record an increase in total income of 777.4 million rupees or 7.92 percent to 10.591 billion rupees for the three months," the statement said.
An improvement of 95.9 million rupees in recoveries on non-performing loans in the quarter also contributed to the reduction in net provisions on bad debts.
The bank’s annualized Return on Equity increased from 17.87 percent to 24.66 percent.
source - www.lbo.lk
Sri Lanka Pan Asia Bank March net up 190-pct
Apr 28, 2011 (LBO) - Sri Lanka's Pan Asia Bank said March 2011 quarter net profit shot up 190 percent to 196 million rupees from a year ago with sharp gains in both interest and non-interest income.
Earnings per share for the quarter went up to 1.33 rupees from 0.61 rupees, according to interim results filed with the stock exchange.
Interest income rose 41 percent to 940 million rupees in the March 2011 quarter while interest expenses rose at a slower 32 percent to 433 million rupees, enabling net interest income to rise 49 percent to 507 million rupees.
Non-interest income shot up 135 percent to 216 million rupees with other income up 163 percent to 174 million and foreign exchange income up 62 percent to 42 million rupees.
Provision for bad loans rose 46 percent to 12 million rupees.
Value added tax on financial services rose six percent to 50 million rupees but corporate tax went up 111 percent to 138 million rupees.
Total gross loans grew 20 percent to 26.6 billion rupees as at March 31, 2011 from the beginning of the year while total deposits rose 22 percent to 26.2 billion rupees.
The bank's annualised interest margin fell to 5.97 percent from 6.39 percent as at December 31, 2010 while return on equity rose 27.31 percent from 14.72 percent.
source -www.lbo.lk
Earnings per share for the quarter went up to 1.33 rupees from 0.61 rupees, according to interim results filed with the stock exchange.
Interest income rose 41 percent to 940 million rupees in the March 2011 quarter while interest expenses rose at a slower 32 percent to 433 million rupees, enabling net interest income to rise 49 percent to 507 million rupees.
Non-interest income shot up 135 percent to 216 million rupees with other income up 163 percent to 174 million and foreign exchange income up 62 percent to 42 million rupees.
Provision for bad loans rose 46 percent to 12 million rupees.
Value added tax on financial services rose six percent to 50 million rupees but corporate tax went up 111 percent to 138 million rupees.
Total gross loans grew 20 percent to 26.6 billion rupees as at March 31, 2011 from the beginning of the year while total deposits rose 22 percent to 26.2 billion rupees.
The bank's annualised interest margin fell to 5.97 percent from 6.39 percent as at December 31, 2010 while return on equity rose 27.31 percent from 14.72 percent.
source -www.lbo.lk
Sri Lanka stocks end up 0.2-pct
Apr 28, 2011 (LBO) - Sri Lankan shares closed higher Thursday with heavy trading in two banks which reported sharply higher March 2011 quarter profits, brokers said.
The main All Share Price Index closed at 7,377.65, up 0.19 percent (13.87 points) while the more liquid Milanka index rose 0.29 percent (19.96 points) to close at 6,836.33, according to stock exchange provisional figures.
Turnover was two billion rupees.
Pan Asia Banking Corporation was the most actively traded stock, closing at 59.10 rupees, up 6.30 with over 3.35 million shares traded.
Pan Asia said March 2011 quarter net profit shot up 190 percent to 196 million rupees from a year ago. The bank also announced a share split of one share for every existing share.
There was also heavy trading in Commercial Bank, which was expected to report sharply higher profit for the March quarter.
The stock closed at 268 rupees, up 2.20 with one million shares going in a crossing at 265 rupees a share.
source - www.lbo.lk
The main All Share Price Index closed at 7,377.65, up 0.19 percent (13.87 points) while the more liquid Milanka index rose 0.29 percent (19.96 points) to close at 6,836.33, according to stock exchange provisional figures.
Turnover was two billion rupees.
Pan Asia Banking Corporation was the most actively traded stock, closing at 59.10 rupees, up 6.30 with over 3.35 million shares traded.
Pan Asia said March 2011 quarter net profit shot up 190 percent to 196 million rupees from a year ago. The bank also announced a share split of one share for every existing share.
There was also heavy trading in Commercial Bank, which was expected to report sharply higher profit for the March quarter.
The stock closed at 268 rupees, up 2.20 with one million shares going in a crossing at 265 rupees a share.
source - www.lbo.lk
Motor stocks rebound with speculative investors in driving seat
Perhaps reflecting the Monday’s fall as a knee jerk reaction after the reduction in import duties, motor stocks bounced back with 15.6% sectoral gain erasing losses incurred early in the week.
The sector’s price index is at a new high of 37,950 points, whilst the total return index was at 46,063 points both well above the level prior to the Government’s u-turn. Last week the closing levels of the two indices were 33,165 and 40,255 respectively. On Monday after the Government raised import duties by a low of 9% and a high 27% the sector index fell by 4%.
Part of the sharp rise in sector index was owing to Lanka Ashok zooming to a new record of Rs. 6,500.
It eventually settled down at Rs. 6,401.90, up by 40% or Rs. 1,822.40 on a volume of 6,700 shares. Lanka Ashok was the second biggest gainer percentagewise and yesterday’s new high beat the previous best of Rs. 4,300. The rise also propelled Lanka Ashok to the top 30 most valuable stocks league to rank 28th with a market capitalisation of Rs. 23.1 billion, above multinational Chevron as well as Dockyard.
Dimo also gained by Rs. 6.40 to Rs. 1,601.60 after peaking to a high of Rs. 1,620, Sathosa Motors gained by Rs. 16.30 to Rs. 284, Colonial Motors by Rs. 24.60 to Rs. 305.80 (it hit a peak of Rs. 310) and United Motors rose by Rs. 2.40 to Rs. 157.80 (hit an intra-day peak of Rs. 167). However the counters are somewhat below their 52-week high prices.
Some analysts attributed the spike yesterday to speculative interest since fundamentally the sector’s earnings will be under pressure following the hike in duty. Others said in comparison to high duties and taxes a year ago the current regime remains attractive for buying vehicles.
Lanka Ashok’s rise was linked to rumours that a share split was in the offing. All motor stocks are highly illiquid hence fetch a premium.
source - www.ft.lk
The sector’s price index is at a new high of 37,950 points, whilst the total return index was at 46,063 points both well above the level prior to the Government’s u-turn. Last week the closing levels of the two indices were 33,165 and 40,255 respectively. On Monday after the Government raised import duties by a low of 9% and a high 27% the sector index fell by 4%.
Part of the sharp rise in sector index was owing to Lanka Ashok zooming to a new record of Rs. 6,500.
It eventually settled down at Rs. 6,401.90, up by 40% or Rs. 1,822.40 on a volume of 6,700 shares. Lanka Ashok was the second biggest gainer percentagewise and yesterday’s new high beat the previous best of Rs. 4,300. The rise also propelled Lanka Ashok to the top 30 most valuable stocks league to rank 28th with a market capitalisation of Rs. 23.1 billion, above multinational Chevron as well as Dockyard.
Dimo also gained by Rs. 6.40 to Rs. 1,601.60 after peaking to a high of Rs. 1,620, Sathosa Motors gained by Rs. 16.30 to Rs. 284, Colonial Motors by Rs. 24.60 to Rs. 305.80 (it hit a peak of Rs. 310) and United Motors rose by Rs. 2.40 to Rs. 157.80 (hit an intra-day peak of Rs. 167). However the counters are somewhat below their 52-week high prices.
Some analysts attributed the spike yesterday to speculative interest since fundamentally the sector’s earnings will be under pressure following the hike in duty. Others said in comparison to high duties and taxes a year ago the current regime remains attractive for buying vehicles.
Lanka Ashok’s rise was linked to rumours that a share split was in the offing. All motor stocks are highly illiquid hence fetch a premium.
source - www.ft.lk
Shares gain on Ashok split rumour
Sri Lanka’s stock market closed firmer on Wednesday in trading, after illiquid Lanka Ashok Leyland jumped nearly 42 percent to a record high on share-split speculation, but gains were capped by losses in telecoms and diversified shares.
Lanka Ashok Leyland, a large-cap vehicle marketer, leapt 41.9 percent to a record Rs. 6,500 per share based on the split rumour, which pushed the motor sector up 15.6 percent to an all-time high.
But 1.9 percent fall in leading mobile operator Dialog Axiata and a 1.2 percent loss in market heavyweight John Keells Holdings kept the overall index in check.
The island’s main share index closed 0.20 percent or 14.61 points firmer at 7,363.78. It hit a record closing high of 7,811.82 on Feb 14.
Turnover was 1.32 billion Sri Lanka rupees ($12 million), well below last year’s average of 2.4 billion and less than this year’s daily average of 3 billion.
Traded volume was 37.1 million, lowest since April 11, against a five-day average of 47.5 million. The 30-day and 90-day average trading volumes were 53.9 million and 63.7 million, respectively. Last year’s daily average volume was 67.9 million.
The bourse is still Asia’s best performer in 2011 with a 11 percent gain, after bringing in the region’s top return of 96 percent last year.
The rupee edged up to 110.16/18 a dollar from Tuesday’s close of 110.18/20 on exporter dollar conversions in low volumes, dealers said. The central bank expects further rupee appreciation this year. (Reuters)
source - www.dailymirror.lk
Lanka Ashok Leyland, a large-cap vehicle marketer, leapt 41.9 percent to a record Rs. 6,500 per share based on the split rumour, which pushed the motor sector up 15.6 percent to an all-time high.
But 1.9 percent fall in leading mobile operator Dialog Axiata and a 1.2 percent loss in market heavyweight John Keells Holdings kept the overall index in check.
The island’s main share index closed 0.20 percent or 14.61 points firmer at 7,363.78. It hit a record closing high of 7,811.82 on Feb 14.
Turnover was 1.32 billion Sri Lanka rupees ($12 million), well below last year’s average of 2.4 billion and less than this year’s daily average of 3 billion.
Traded volume was 37.1 million, lowest since April 11, against a five-day average of 47.5 million. The 30-day and 90-day average trading volumes were 53.9 million and 63.7 million, respectively. Last year’s daily average volume was 67.9 million.
The bourse is still Asia’s best performer in 2011 with a 11 percent gain, after bringing in the region’s top return of 96 percent last year.
The rupee edged up to 110.16/18 a dollar from Tuesday’s close of 110.18/20 on exporter dollar conversions in low volumes, dealers said. The central bank expects further rupee appreciation this year. (Reuters)
source - www.dailymirror.lk
Expolanka pre-IPO sell down creates controversy
By Indika Sakalasooriya and Jithendra Antonio
Analysts and stock brokerage fraternity in the country were seen little disturbed and distressed about the pre-IPO sell down of the Expolanka Initial Public Offering (IPO), at a significantly low price compared to the offer price.
According to the prospectus of the Expolanka IPO, the sell down of each share by the owners of the company has taken place at Rs.6, while through the IPO, public is offered Rs. 14 per share.
“The question that has been bugging many is, by subscribing to this share at the IPO, aren’t they letting those who bought shares by way of private placements and sell downs at lesser prices (than the IPO price), make money?” a stock market analyst opined on the grounds of anonymity.
He also said that serious doubts have surfaced over the real share value, in the backdrop of company owners selling a considerable part of their stake at Rs.6 per share.
“What we should notice is that, the offer price is 133 percent higher than the sell down price”
The explanation given for the sell down at Rs.6 is, it was done late last year before latest Expolanka financial results came into light.
“There’s no significant difference between the pricing in September 2010 and the pricing now,” Krishan Balendra, President, Corporate Finance & Group Strategy of John Keells Holdings was quoted as saying to Lanka Business Online recently.
However, according to Capital Trust Director Research, Sarath Rajapakse, there is going to be a massacre of small investors once the Expolanka shares hit the market.
“Well the IPO will be oversubscribed, but if the directors have sold down shares to private investors at Rs.6 per share, it means they are going to sell them after IPO anyway,” added Rajapakse.
At the presentation made to the stock brokering community on Tuesday, the managers to the issue John Keells Capital had refused to give any assurance as to whether the private investors will sell at the expense of small retailers, once Expolanka shares enter the CSE trade floor.
Krishan Balendra told Mirror Business at the official launch of the IPO on Tuesday that Expolanka’s directors have sold their holdings to private investors and that does not count as a private placement.
“SEC’s “Lock In Rule” has no relevance to this situation” Balendra added.
Meanwhile, Head of Research at CT Smith Stockbrokers Talaal Maruzook highlighted that Expolanka shares is still attractive, given the fact that Expolanka shares are offered at a discounted price compared to other companies that are listed on the CSE board, under the Diversified Holdings Sector. However, two other companies listed under Diversified Holdings including Richard Pieris (RICH) and Dunamis Capital (CSEC) is also trading at less than Rs.14 levels as per market data.
Expolanka Holdings is to raise Rs. 2.4 billion by issuing 172 million ordinary voting shares at Rs. 14 each, with the IPO opening on May 12.
source - www.dailymirror.lk
Analysts and stock brokerage fraternity in the country were seen little disturbed and distressed about the pre-IPO sell down of the Expolanka Initial Public Offering (IPO), at a significantly low price compared to the offer price.
According to the prospectus of the Expolanka IPO, the sell down of each share by the owners of the company has taken place at Rs.6, while through the IPO, public is offered Rs. 14 per share.
“The question that has been bugging many is, by subscribing to this share at the IPO, aren’t they letting those who bought shares by way of private placements and sell downs at lesser prices (than the IPO price), make money?” a stock market analyst opined on the grounds of anonymity.
He also said that serious doubts have surfaced over the real share value, in the backdrop of company owners selling a considerable part of their stake at Rs.6 per share.
“What we should notice is that, the offer price is 133 percent higher than the sell down price”
The explanation given for the sell down at Rs.6 is, it was done late last year before latest Expolanka financial results came into light.
“There’s no significant difference between the pricing in September 2010 and the pricing now,” Krishan Balendra, President, Corporate Finance & Group Strategy of John Keells Holdings was quoted as saying to Lanka Business Online recently.
However, according to Capital Trust Director Research, Sarath Rajapakse, there is going to be a massacre of small investors once the Expolanka shares hit the market.
“Well the IPO will be oversubscribed, but if the directors have sold down shares to private investors at Rs.6 per share, it means they are going to sell them after IPO anyway,” added Rajapakse.
At the presentation made to the stock brokering community on Tuesday, the managers to the issue John Keells Capital had refused to give any assurance as to whether the private investors will sell at the expense of small retailers, once Expolanka shares enter the CSE trade floor.
Krishan Balendra told Mirror Business at the official launch of the IPO on Tuesday that Expolanka’s directors have sold their holdings to private investors and that does not count as a private placement.
“SEC’s “Lock In Rule” has no relevance to this situation” Balendra added.
Meanwhile, Head of Research at CT Smith Stockbrokers Talaal Maruzook highlighted that Expolanka shares is still attractive, given the fact that Expolanka shares are offered at a discounted price compared to other companies that are listed on the CSE board, under the Diversified Holdings Sector. However, two other companies listed under Diversified Holdings including Richard Pieris (RICH) and Dunamis Capital (CSEC) is also trading at less than Rs.14 levels as per market data.
Expolanka Holdings is to raise Rs. 2.4 billion by issuing 172 million ordinary voting shares at Rs. 14 each, with the IPO opening on May 12.
source - www.dailymirror.lk
Piramal Glass Ceylon records profits, crosses Rs. 4bn revenue-mark
* Declares a 30 percent dividend
* Post-conflict economic revival boosts domestic sales
April 27, 2011, 8:16 pm
Peace dividend:
With peace in the island, the domestic market contributed significantly to Piramal Glass Ceylon PLC’s financial performance, helping it report strong profits for the recently concluded financial year after making losses the previous year. The various segments of the local market added towards the domestic market growth of 34 percent from Rs.2.35 billion to Rs.3.16 billion. Volume wise there was a growth of 26 percent.
Piramal Glass Ceylon Plc (PGC) made record profits for the financial year ended March 31, 2011, after recording a Rs. 61 million loss the previous year, on revenue growth of 14 percent, taking after-tax profits to Rs. 578 million.
Releasing its annual financials the company said that revenue achieved for the year (FY11) was Rs. 4.16 billion, a growth of 18 percent as against Rs. 3.52 billion the previous year. Profit after tax (PAT) amounted to Rs. 578 million, equating to 14 percent of turnover as against the loss of Rs. 61 million recorded in FY10. With this exceptional performance the board of directors has declared a first and final dividend of 30 percent.
PGC’s Chief Executive Officer and Executive Director, Sanjay Tiwari while announcing PGC’s results said, "We’re proud to report the best ever annual results for PGC. This year we started reaping the returns of the extensive investments on our new facility at Horana."
With peace being restored in the region, the domestic market contributed significantly during the year under review. The various segments of local market added towards the domestic market growth of 34 percent from Rs.2.35 billion to Rs.3.16 billion. Volume wise also there was a growth of 26 percent.
The main contributor to the profitability was the premium Export Market segment. The company ensured that the export sales crossed the Rs.1 billion Mark for the second consecutive year. Several new products were designed and launched in the export market which yielded high realisation to the profitability.
The export product portfolio saw a gradual shift from mass market to high end premium market segment yielding higher realizations. Speciality (high end) market segment grew by 24 percent in volume from 8,607 tonnes to 10,660 tonnes whilst the company voluntarily reduced the Mass market segment by 60 percent.
The manufacturing facility also contributed to ensure a cost effective bottle being produced. Improved efficiencies & speeds contributed towards the final profitability. During the period the company was able to produce 11 percent more than the previous year. This helped the company maintain the cost of bottles amidst the raw material costs increases. The unprecedented increase in energy prices namely LPG Gas, Electricity tariff & Furnace oil has impacted the over all cost of production.
During the year PGC was accredited with ISO 22000:2005 certifications designed for food and safety. The Company has already received certification for complying with ISO 9001:2008 Quality Management System. This new accreditation is a testimony to the best in class systems & processors followed by the company.
The continuous achievements of Piramal Glass Ceylon during FY11 were also recognized by external agencies with several awards. PGC received the Gold Medal in Large Category at National Chamber of Exports Export Awards, Merit Award for Industrial Excellence at Ceylon National Chamber of Industries Achievers Awards, Gold Award in Manufacturing Sector and Silver Award in the Best Tech Savvy Company segment at the National Business Excellence awards organized by National Chamber of Commerce Sri Lanka and a Bronze Award at the Lanka Star 2010 organized by Sri Lanka institute of Packaging.
"We are indeed thrilled at the performance of Piramal Glass Ceylon. This is also evident from the closing share price which has grown 5 times as compared to 31st March 2010. Also the Market Capitalization crossed Rs.10.5 Billion as compared to Rs.2.1 Billion at the beginning of the year." Said Sanjay Tiwari.
Vijay Shah Chairman Piramal Glass Ceylon PLC said, "We are confident that with the growing domestic markets coupled with potential of premium export market, the company would continue to strive towards excellent performance in the future too. We also would like to acknowledge the trust and confidence placed by our stake holders. We have suitably rewarded by way of a proposal of 30 percent final dividend for the year 2010/11."
source - www.island.lk
* Post-conflict economic revival boosts domestic sales
April 27, 2011, 8:16 pm
Peace dividend:
With peace in the island, the domestic market contributed significantly to Piramal Glass Ceylon PLC’s financial performance, helping it report strong profits for the recently concluded financial year after making losses the previous year. The various segments of the local market added towards the domestic market growth of 34 percent from Rs.2.35 billion to Rs.3.16 billion. Volume wise there was a growth of 26 percent.
Piramal Glass Ceylon Plc (PGC) made record profits for the financial year ended March 31, 2011, after recording a Rs. 61 million loss the previous year, on revenue growth of 14 percent, taking after-tax profits to Rs. 578 million.
Releasing its annual financials the company said that revenue achieved for the year (FY11) was Rs. 4.16 billion, a growth of 18 percent as against Rs. 3.52 billion the previous year. Profit after tax (PAT) amounted to Rs. 578 million, equating to 14 percent of turnover as against the loss of Rs. 61 million recorded in FY10. With this exceptional performance the board of directors has declared a first and final dividend of 30 percent.
PGC’s Chief Executive Officer and Executive Director, Sanjay Tiwari while announcing PGC’s results said, "We’re proud to report the best ever annual results for PGC. This year we started reaping the returns of the extensive investments on our new facility at Horana."
With peace being restored in the region, the domestic market contributed significantly during the year under review. The various segments of local market added towards the domestic market growth of 34 percent from Rs.2.35 billion to Rs.3.16 billion. Volume wise also there was a growth of 26 percent.
The main contributor to the profitability was the premium Export Market segment. The company ensured that the export sales crossed the Rs.1 billion Mark for the second consecutive year. Several new products were designed and launched in the export market which yielded high realisation to the profitability.
The export product portfolio saw a gradual shift from mass market to high end premium market segment yielding higher realizations. Speciality (high end) market segment grew by 24 percent in volume from 8,607 tonnes to 10,660 tonnes whilst the company voluntarily reduced the Mass market segment by 60 percent.
The manufacturing facility also contributed to ensure a cost effective bottle being produced. Improved efficiencies & speeds contributed towards the final profitability. During the period the company was able to produce 11 percent more than the previous year. This helped the company maintain the cost of bottles amidst the raw material costs increases. The unprecedented increase in energy prices namely LPG Gas, Electricity tariff & Furnace oil has impacted the over all cost of production.
During the year PGC was accredited with ISO 22000:2005 certifications designed for food and safety. The Company has already received certification for complying with ISO 9001:2008 Quality Management System. This new accreditation is a testimony to the best in class systems & processors followed by the company.
The continuous achievements of Piramal Glass Ceylon during FY11 were also recognized by external agencies with several awards. PGC received the Gold Medal in Large Category at National Chamber of Exports Export Awards, Merit Award for Industrial Excellence at Ceylon National Chamber of Industries Achievers Awards, Gold Award in Manufacturing Sector and Silver Award in the Best Tech Savvy Company segment at the National Business Excellence awards organized by National Chamber of Commerce Sri Lanka and a Bronze Award at the Lanka Star 2010 organized by Sri Lanka institute of Packaging.
"We are indeed thrilled at the performance of Piramal Glass Ceylon. This is also evident from the closing share price which has grown 5 times as compared to 31st March 2010. Also the Market Capitalization crossed Rs.10.5 Billion as compared to Rs.2.1 Billion at the beginning of the year." Said Sanjay Tiwari.
Vijay Shah Chairman Piramal Glass Ceylon PLC said, "We are confident that with the growing domestic markets coupled with potential of premium export market, the company would continue to strive towards excellent performance in the future too. We also would like to acknowledge the trust and confidence placed by our stake holders. We have suitably rewarded by way of a proposal of 30 percent final dividend for the year 2010/11."
source - www.island.lk
Market trims losses
The Colombo stocks marginally trimmed losses after a successive losing streak. However the MPI continued its losing momentum, ending trading in red.
ASI jumped into green by 14.61 points (+0.20%) and closed at 7,363.78 while MPI recorded a loss of 20.17 points (-0.30%) to close at 6,816.37.
Lankem Ceylon Plc (Rs 185.7mn) emerged as the top contributor to the turnover followed by Brown and Company Plc (Rs 108.5mn) and Colombo Fort Land and Building Company Plc (Rs 72.7mn). All these counters also traded with active investor participation.
In addition Aitken Spence Hotels Plc has bought 20,000 shares of Browns Beach Hotels Plc at prices of Rs 21.10 (10,000 shares) and Rs 21.20 (10,000 shares) respectively. Motor sector counters such as Lanka Ashok Leyland Plc, Autodrome Plc and Colonial Motors Plc were among the top ten gainers.
Foreign participation dropped to 7.5 percent of the total market activity. High net foreign selling was witnessed during the day with a net foreign outflow of Rs 64.08 million.
Lanka Securities
source - www.dailynews.lk
ASI jumped into green by 14.61 points (+0.20%) and closed at 7,363.78 while MPI recorded a loss of 20.17 points (-0.30%) to close at 6,816.37.
Lankem Ceylon Plc (Rs 185.7mn) emerged as the top contributor to the turnover followed by Brown and Company Plc (Rs 108.5mn) and Colombo Fort Land and Building Company Plc (Rs 72.7mn). All these counters also traded with active investor participation.
In addition Aitken Spence Hotels Plc has bought 20,000 shares of Browns Beach Hotels Plc at prices of Rs 21.10 (10,000 shares) and Rs 21.20 (10,000 shares) respectively. Motor sector counters such as Lanka Ashok Leyland Plc, Autodrome Plc and Colonial Motors Plc were among the top ten gainers.
Foreign participation dropped to 7.5 percent of the total market activity. High net foreign selling was witnessed during the day with a net foreign outflow of Rs 64.08 million.
Lanka Securities
source - www.dailynews.lk
Corporate earnings to increase
Charumini DE SILVA
The CSE has been able to capture more attention and interest in foreign investments compared to the regional markets.
There will be a 40 percent growth in the earnings of listed companies in the Colombo Stock Exchange (CSE) whereas the listed companies in the regional countries will record a growth of around 18 to 22 percent for this year.
Speaking to the Daily News Business Richard Pieris Securities CEO Jayantha Perera said the country indicates a positive economic outlook with the low interest rate regime encouraging tax system. “The growth momentum will continue,” he said.
The listed companies and investors will benefit remarkably while contributing immensely to enhance the economy.
The expected earnings in the market are trading currently at a price earning multiply of around 14 times.
“Investors are coming back and little collections on certain counters such as banking, food and beverage and retail sectors are noticed. Since the commodity prices have increased these counters have attracted an impressive number of investors. The overall market will re-bound fully at the beginning of May. Currently, there are a flock of buyers, but not enough sellers. This generates a lower daily turnover in the market,” he said.
There will be a number of upcoming Initial Public Offerings (IPOs) in the next few months and those who will not enter the capital market within the next couple of months will definitely regret.
The existing companies and the investors are harnessing high returns on their investments. There will be around four IPOs lined up for the next three months and this indicates the confidence level of both foreign and local investors over the CSE.
source - www.dailynews.lk
The CSE has been able to capture more attention and interest in foreign investments compared to the regional markets.
There will be a 40 percent growth in the earnings of listed companies in the Colombo Stock Exchange (CSE) whereas the listed companies in the regional countries will record a growth of around 18 to 22 percent for this year.
Speaking to the Daily News Business Richard Pieris Securities CEO Jayantha Perera said the country indicates a positive economic outlook with the low interest rate regime encouraging tax system. “The growth momentum will continue,” he said.
The listed companies and investors will benefit remarkably while contributing immensely to enhance the economy.
The expected earnings in the market are trading currently at a price earning multiply of around 14 times.
“Investors are coming back and little collections on certain counters such as banking, food and beverage and retail sectors are noticed. Since the commodity prices have increased these counters have attracted an impressive number of investors. The overall market will re-bound fully at the beginning of May. Currently, there are a flock of buyers, but not enough sellers. This generates a lower daily turnover in the market,” he said.
There will be a number of upcoming Initial Public Offerings (IPOs) in the next few months and those who will not enter the capital market within the next couple of months will definitely regret.
The existing companies and the investors are harnessing high returns on their investments. There will be around four IPOs lined up for the next three months and this indicates the confidence level of both foreign and local investors over the CSE.
source - www.dailynews.lk
Wednesday, April 27, 2011
Sri Lanka stocks end up 0.2-pct
Apr 27, 2011 (LBO) - Sri Lankan shares closed mixed once again Wednesday in dull trade with motor sector shares rebounding from losses sustained after a government import duty hike likely to slow car sales, brokers said.
The main All Share Price Index closed at 7,363.78, up 0.20 percent (14.61 points) while the more liquid Milanka index fell 0.30 percent (20.17 points) to close at 6,816.37, according to stock exchange provisional figures.
Turnover was 1.3 billion rupees.
Lankem Ceylon was actively traded, closing at 506.60 rupees, up 46.60, while Brown & Company was also actively traded, closing up 17.20 at 338.10 rupees.
Motor shares rebound strongly with the sector itself up 15 percent albeit on thin volumes after falling the previous two days after Monday's import duty hike on on several models of cars.
Diesel & Motor Engineering, agents for German luxury car manufacturer Mercedes Benz, Cherokee of the US and heavy vehicles and car manufacturer TATA Motors, rose 6.40 to close at 1,601.60.
United Motors, agents for Mitsubishi and Malaysia's Viva, rose 2.40 to close at 157.80 while Colonial Motors, which imports Land Rover and KIA vehicles, closed at 305.80, up 24.60.
Lanka Ashok Leyland, which imports buses from India and did not fall after the import duty hike, rose again to close at 6,401.90, up 1,822.40.
source - http://www.lbo.lk/
The main All Share Price Index closed at 7,363.78, up 0.20 percent (14.61 points) while the more liquid Milanka index fell 0.30 percent (20.17 points) to close at 6,816.37, according to stock exchange provisional figures.
Turnover was 1.3 billion rupees.
Lankem Ceylon was actively traded, closing at 506.60 rupees, up 46.60, while Brown & Company was also actively traded, closing up 17.20 at 338.10 rupees.
Motor shares rebound strongly with the sector itself up 15 percent albeit on thin volumes after falling the previous two days after Monday's import duty hike on on several models of cars.
Diesel & Motor Engineering, agents for German luxury car manufacturer Mercedes Benz, Cherokee of the US and heavy vehicles and car manufacturer TATA Motors, rose 6.40 to close at 1,601.60.
United Motors, agents for Mitsubishi and Malaysia's Viva, rose 2.40 to close at 157.80 while Colonial Motors, which imports Land Rover and KIA vehicles, closed at 305.80, up 24.60.
Lanka Ashok Leyland, which imports buses from India and did not fall after the import duty hike, rose again to close at 6,401.90, up 1,822.40.
source - http://www.lbo.lk/
Sri Lanka Piramal profits up amid strong local demand
Apr 27, 2011 (LBO) - Sri Lanka's Piramal Glass Ceylon said the firm returned to profits in the year ending March 2011 amid strong local demand following the end of a war, and a strategy to focus on high margin exports.
The firm reported annual profits of 578 million rupees from a loss of 61 million a year earlier, giving earnings per share of 61 cents. The stock traded at 11.40 rupees intra-day Wednesday.
Revenues grew 18.3 percent to 4.1 billion rupees, with local sales rising to 3.1 billion rupees from 2.3 billion and exports easing to 1.0 billion rupees from 1.1 billion.
"With peace being restored in the region, the domestic market contributed significantly during the year under review," the firm said in a statement.
While local revenues grew 34 percent, volumes expanded 24 percent.
"The export product portfolio saw a gradual shift from mass market to high end premium market segment yielding higher realizations," the firm said.
"Speciality (high end) market segment grew by 24 percent in volume from 8,607 tonnes to 10,660 tonnes whilst the company voluntarily reduced the mass market segment by 60 percent."
"Several new products were designed and launched in the export market which yielded high realisation to the profitability."
Piramal Glass said a new factory outside Sri Lanka's capital Colombo to which production was shifted was more cost efficient, despite steep price rises in energy.
"Improved efficiencies and speeds contributed towards the final profitability. During the period the company was able to produce 11% more than the previous year," the firm said.
"This helped the company maintain the cost of bottles amidst the raw material cost increases.
"The unprecedented increase in energy prices namely LPG Gas, Electricity tariff and Furnace oil has impacted the over all cost of production."
Piramal Glass said it was holding its property at Ratmalana, a suburb south of Colombo which was valued at 700 million rupees, with no decision yet on its use.
source - http://www.lbo.lk/
The firm reported annual profits of 578 million rupees from a loss of 61 million a year earlier, giving earnings per share of 61 cents. The stock traded at 11.40 rupees intra-day Wednesday.
Revenues grew 18.3 percent to 4.1 billion rupees, with local sales rising to 3.1 billion rupees from 2.3 billion and exports easing to 1.0 billion rupees from 1.1 billion.
"With peace being restored in the region, the domestic market contributed significantly during the year under review," the firm said in a statement.
While local revenues grew 34 percent, volumes expanded 24 percent.
"The export product portfolio saw a gradual shift from mass market to high end premium market segment yielding higher realizations," the firm said.
"Speciality (high end) market segment grew by 24 percent in volume from 8,607 tonnes to 10,660 tonnes whilst the company voluntarily reduced the mass market segment by 60 percent."
"Several new products were designed and launched in the export market which yielded high realisation to the profitability."
Piramal Glass said a new factory outside Sri Lanka's capital Colombo to which production was shifted was more cost efficient, despite steep price rises in energy.
"Improved efficiencies and speeds contributed towards the final profitability. During the period the company was able to produce 11% more than the previous year," the firm said.
"This helped the company maintain the cost of bottles amidst the raw material cost increases.
"The unprecedented increase in energy prices namely LPG Gas, Electricity tariff and Furnace oil has impacted the over all cost of production."
Piramal Glass said it was holding its property at Ratmalana, a suburb south of Colombo which was valued at 700 million rupees, with no decision yet on its use.
source - http://www.lbo.lk/
Sri Lanka IPO pricing based on latest financials: advisors
Apr 26, 2011 (LBO) - Financial advisors for a forthcoming share issue by Sri Lanka's Expolanka group have defended the pricing of the public offer at more than twice that of a private placement late last year.
Expolanka Holdings is to raise 2.4 billion rupees by issuing 172 million ordinary voting shares at 14 rupees each with the initial public offer opening on May 12.
Previously some shares had been placed at 6 rupees each. Proceeds of new shares issued in the IPO will be used for expansion and to pay down debt.
Chinthaka Ranasinghe, assistant vice president of John Keells Capital, lead manager and financial advisor to the IPO, said the bulk of the funds would be used for working capital with the rest going for expansion and loan repayment.
Expolanka has a regional freight and logistics business stretching across, India, Bangladesh, Vietnam and Africa and has investments in tertiary education, business process outsourcing.
Krishan Balendra, president, Corporate Finance & Group Strategy of John Keells Holdings, said the private placement of shares was done late last year before the latest financial results of Expolanka were known.
"There's no significant difference between the pricing in September 2010 and the pricing now," he told a news conference held to formally announce the IPO.
He said the private placement was done at a time when the latest profit numbers were not known and that those investors were "possibly locked in for two years."
According to the Expolanka prospectus John Keells Holdings has 83.3 million shares or a 4.6 percent stake in Expolanka prior to the IPO.
Ceylon Investment had 41.6 million shares or 2.33 percent, Lanka Strategic Investments 16.7 million shares or 0.93 percent and Softlogic Holdings 16.5 million or 0.93 percent along with small stakes by Falcon Trading, Timex Garments and a few individuals.
source - www.lbo.lk
Expolanka Holdings is to raise 2.4 billion rupees by issuing 172 million ordinary voting shares at 14 rupees each with the initial public offer opening on May 12.
Previously some shares had been placed at 6 rupees each. Proceeds of new shares issued in the IPO will be used for expansion and to pay down debt.
Chinthaka Ranasinghe, assistant vice president of John Keells Capital, lead manager and financial advisor to the IPO, said the bulk of the funds would be used for working capital with the rest going for expansion and loan repayment.
Expolanka has a regional freight and logistics business stretching across, India, Bangladesh, Vietnam and Africa and has investments in tertiary education, business process outsourcing.
Krishan Balendra, president, Corporate Finance & Group Strategy of John Keells Holdings, said the private placement of shares was done late last year before the latest financial results of Expolanka were known.
"There's no significant difference between the pricing in September 2010 and the pricing now," he told a news conference held to formally announce the IPO.
He said the private placement was done at a time when the latest profit numbers were not known and that those investors were "possibly locked in for two years."
According to the Expolanka prospectus John Keells Holdings has 83.3 million shares or a 4.6 percent stake in Expolanka prior to the IPO.
Ceylon Investment had 41.6 million shares or 2.33 percent, Lanka Strategic Investments 16.7 million shares or 0.93 percent and Softlogic Holdings 16.5 million or 0.93 percent along with small stakes by Falcon Trading, Timex Garments and a few individuals.
source - www.lbo.lk
Sri Lanka IPOs May Triple as Colombo Index Beats Asian Peers
April 26 (Bloomberg) -- Sri Lanka initial public offerings may more than triple to a record this year after the nation’s stock index posted the biggest gain in Asia, according to managers of three of the five share sales since Jan. 1.
The number of IPOs may jump to as many as 25 from seven in 2010, according to investment firms Acuity Partners (Pvt) Ltd. and John Keells Capital, which led three sales that accounted for 69 percent of the $28.9 million total raised in 2011.
Companies are lining up to sell stock after the Colombo All-Share Index soared more than threefold since the end of a 26-year civil war in May 2009 and climbed 11 percent so far this year. With the Securities and Exchange Commission predicting market capitalization could climb by 27 percent to about 3 trillion rupees ($27 billion) this year, the IPOs may weigh on share prices, according to John Keells Capital, the investment arm of Sri Lanka’s largest listed company.
“There might be a little bit of a reallocation of funds and resources from existing stocks to IPOs,” Chinthaka Ranasinghe, assistant vice president at John Keells Capital, said in a phone interview from Colombo. “You might see a little bit of a correction.”
John Keells Capital and brokerage Taprobane Securities (Pvt) Ltd. managed the $13.6 million offering for tea and rubber producer Free Lanka Capital Holding Ltd., the country’s biggest IPO this year. The 180 initial share sales in Asia Pacific emerging markets have raised $20.1 billion so far in 2011, while the 519 deals worldwide have raised $68.9 billion, according to data compiled by Bloomberg.
‘Strong Bite’
Stocks in the Sri Lankan index were valued at an average of 26.6 times reported earnings as of the week ended April 21, according data on the Colombo Stock Exchange website. That’s the highest valuation in the Asia Pacific region apart from the 27.4 price-earnings ratio for New Zealand’s NZX 50 Index. Equities in the MSCI Emerging Markets Index are valued at 13.4 times earnings, while the MSCI World Index is at 14.8 times.
“It’s very expensive,” said Acuity Partners’ Group Chief Executive Officer Ray Abeywardena. “A global investor has a wide market to select from, so a new stock coming out at 12 to 13 times multiples will be a strong bite.”
The eight IPOs priced in Sri Lanka last year raised a total of $36.5 million, according to Bloomberg data. Laugfs Gas Ltd. was the largest, raising $22.6 million for the sale of voting and non-voting shares. The voting stock has climbed 52 percent since the company started trading on Dec. 8.
‘Huge Appetite’
“There’s a huge appetite,” Abeywardena said. “People are very hungry for the right one. But it will be determined by valuations.”
New listings with higher valuations may still attract investors, according to Vajira Kulatilaka, chief executive of National Development Bank Plc’s investment banking division.
“Some stocks may come at higher PEs because there’s a growth story happening here,” said Kulatilaka, whose firm managed the IPO for Dialog Axiata Ltd., the Sri Lankan unit of Southeast Asia’s second-largest mobile-phone provider Axiata Group Bhd.
Dialog was valued at 21 times earnings when it first started trading in 2005, Kulatilaka said. The company’s share sale raised $85.4 million, the most among all of the country’s new listings since 2003.
Investment Plans
Sri Lanka’s economy expanded 8 percent in 2010, the most since 1978, the statistics department said on March 29. It grew 3.5 percent in 2009 after President Mahinda Rajapaksa’s government ended the Liberation Tigers of Tamil Eelam’s quest for a separate homeland, prompting companies including Shangri- La Asia Ltd. and Nestle Lanka Plc to announce investment plans in the country.
The All-Share Index surged 96 percent in 2010, the world’s best performance apart from Mongolia, and extended the rally this year in Asia’s best performance.
External factors including higher oil prices increased the risk of “corrections” and “some kind of tapering off,” said Dinal Wijemanne, managing director of Taprobane Securities. The brokerage is aiming to manage as many as six more share sales this year, in addition to the Free Lanka Capital Holding deal.
“The last two years’ performance is not sustainable, with the number of IPOs coming in this year,” Wijemanne said. “Maybe local investors got a bit spoiled by the kind of returns we experienced, but it’s just not possible to maintain that.”
To contact the reporter on this story: Kristine Aquino in Singapore at kaquino@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
source - www.bloomberg.com
The number of IPOs may jump to as many as 25 from seven in 2010, according to investment firms Acuity Partners (Pvt) Ltd. and John Keells Capital, which led three sales that accounted for 69 percent of the $28.9 million total raised in 2011.
Companies are lining up to sell stock after the Colombo All-Share Index soared more than threefold since the end of a 26-year civil war in May 2009 and climbed 11 percent so far this year. With the Securities and Exchange Commission predicting market capitalization could climb by 27 percent to about 3 trillion rupees ($27 billion) this year, the IPOs may weigh on share prices, according to John Keells Capital, the investment arm of Sri Lanka’s largest listed company.
“There might be a little bit of a reallocation of funds and resources from existing stocks to IPOs,” Chinthaka Ranasinghe, assistant vice president at John Keells Capital, said in a phone interview from Colombo. “You might see a little bit of a correction.”
John Keells Capital and brokerage Taprobane Securities (Pvt) Ltd. managed the $13.6 million offering for tea and rubber producer Free Lanka Capital Holding Ltd., the country’s biggest IPO this year. The 180 initial share sales in Asia Pacific emerging markets have raised $20.1 billion so far in 2011, while the 519 deals worldwide have raised $68.9 billion, according to data compiled by Bloomberg.
‘Strong Bite’
Stocks in the Sri Lankan index were valued at an average of 26.6 times reported earnings as of the week ended April 21, according data on the Colombo Stock Exchange website. That’s the highest valuation in the Asia Pacific region apart from the 27.4 price-earnings ratio for New Zealand’s NZX 50 Index. Equities in the MSCI Emerging Markets Index are valued at 13.4 times earnings, while the MSCI World Index is at 14.8 times.
“It’s very expensive,” said Acuity Partners’ Group Chief Executive Officer Ray Abeywardena. “A global investor has a wide market to select from, so a new stock coming out at 12 to 13 times multiples will be a strong bite.”
The eight IPOs priced in Sri Lanka last year raised a total of $36.5 million, according to Bloomberg data. Laugfs Gas Ltd. was the largest, raising $22.6 million for the sale of voting and non-voting shares. The voting stock has climbed 52 percent since the company started trading on Dec. 8.
‘Huge Appetite’
“There’s a huge appetite,” Abeywardena said. “People are very hungry for the right one. But it will be determined by valuations.”
New listings with higher valuations may still attract investors, according to Vajira Kulatilaka, chief executive of National Development Bank Plc’s investment banking division.
“Some stocks may come at higher PEs because there’s a growth story happening here,” said Kulatilaka, whose firm managed the IPO for Dialog Axiata Ltd., the Sri Lankan unit of Southeast Asia’s second-largest mobile-phone provider Axiata Group Bhd.
Dialog was valued at 21 times earnings when it first started trading in 2005, Kulatilaka said. The company’s share sale raised $85.4 million, the most among all of the country’s new listings since 2003.
Investment Plans
Sri Lanka’s economy expanded 8 percent in 2010, the most since 1978, the statistics department said on March 29. It grew 3.5 percent in 2009 after President Mahinda Rajapaksa’s government ended the Liberation Tigers of Tamil Eelam’s quest for a separate homeland, prompting companies including Shangri- La Asia Ltd. and Nestle Lanka Plc to announce investment plans in the country.
The All-Share Index surged 96 percent in 2010, the world’s best performance apart from Mongolia, and extended the rally this year in Asia’s best performance.
External factors including higher oil prices increased the risk of “corrections” and “some kind of tapering off,” said Dinal Wijemanne, managing director of Taprobane Securities. The brokerage is aiming to manage as many as six more share sales this year, in addition to the Free Lanka Capital Holding deal.
“The last two years’ performance is not sustainable, with the number of IPOs coming in this year,” Wijemanne said. “Maybe local investors got a bit spoiled by the kind of returns we experienced, but it’s just not possible to maintain that.”
To contact the reporter on this story: Kristine Aquino in Singapore at kaquino@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
source - www.bloomberg.com
Primal Glass shines with best ever performance in 2010/11
Turnover tops Rs. 4 b; profit after tax up 14% to Rs. 578 m as against Rs. 61 m loss last year; 30% dividend declared
Piramal Glass Ceylon Plc (PGC), made record profits for F2011 by performing exceptionally well in all spheres of the business.
Revenue achieved for the year was Rs.4.16 billion witnessing a growth of 18% as against Rs.3.52 billion for the previous year. The Profit After Tax (PAT) was Rs.578 million, equating to 14% of turnover as against the loss of Rs.61 million recorded in F2010. With this exceptional performance the board of directors has declared a first & final dividend of 30%. In 2009/10 the company made a loss of Rs. 61 million.
PGC’s Chief Executive Officer and Executive Director, Sanjay Tiwari while announcing PGC’s results said, “We’re proud to report the best ever annual results for PGC. This year we started reaping the returns of the extensive investments on our new facility at Horana.”
With peace being restored in the region, the domestic market contributed significantly during the year under review. The various segments of local market added towards the domestic market growth of 34% from Rs.2.35 billion to Rs.3.16 billion. Volume wise also there was a growth of 26%.
The main contributor to the profitability was the premium Export Market segment. The company ensured that the export sales crossed the Rs.1 billion mark for the 2nd consecutive year. Several new products were designed and launched in the export market which yielded high realisation to the profitability. The export product portfolio saw a gradual shift from mass market to high end premium market segment yielding higher realisations. Speciality (high end) market segment grew by 24% in volume from 8,607 tonnes to 10,660 tonnes whilst the company voluntarily reduced the mass market segment by 60%.
The manufacturing facility also contributed to ensure a cost effective bottle being produced. Improved efficiencies & speeds contributed towards the final profitability.
During the period the company was able to produce 11% more than the previous year. This helped the company maintain the cost of bottles amidst the raw material cost increases. The unprecedented increase in energy prices namely LPG Gas, electricity tariff & furnace oil has impacted the overall cost of production.
During the year PGC was accredited with ISO 22000:2005 certifications designed for food and safety. The company has already received certification for complying with ISO 9001:2008 Quality Management System. This new accreditation is a testimony to the best in class systems & processors followed by the company.
The continuous achievements of Piramal Glass Ceylon during FY2011 were also recognised by external agencies with several awards. PGC received the Gold Medal in Large Category at National Chamber of Exports Export Awards, Merit Award for Industrial Excellence at Ceylon National Chamber of Industries Achievers Awards, Gold Award in Manufacturing Sector and Silver Award in the Best Tech Savvy Company segment at the National Business Excellence awards organised by the National Chamber of Commerce Sri Lanka, and a Bronze Award at the Lanka Star 2010 organised by Sri Lanka institute of Packaging.
“We are indeed thrilled at the performance of Piramal Glass Ceylon. This is also evident from the closing share price which has grown 5 times as compared to 31 March 2010. Market Capitalisation crossed Rs.10.5 billion as compared to Rs.2.1 billion at the beginning of the year,” Tiwari added.
Vijay Shah Chairman Piramal Glass Ceylon Plc said, “We are confident that with the growing domestic markets coupled with potential of premium export market, the company would continue to strive towards excellent performance in the future too. We also would like to acknowledge the trust and confidence placed by our stake holders. We have suitably rewarded by way of a proposal of 30% final dividend for the year 2010/11.”
Piramal Glass Limited (“PGL”, erstwhile Gujarat Glass Limited) is a leading global manufacturer of flaconnage (glass containers) for pharmaceuticals, foods & beverages and cosmetics and perfumery industries. The company had revenues of Rs. 1,100 crores in FY2010. PGL has a global footprint, with manufacturing facilities located in USA, Sri Lanka and India. The company markets its products to more than 54 countries across the globe. The company is also the largest producer of nail-polish bottles globally, with more than 30% market share. PGL is listed on the National Stock Exchange, the Bombay Stock Exchange and Ahmedabad Stock Exchange (Ticker: 20219).
The Piramal Group led by Ajay G. Piramal is one of India’s foremost business conglomerates. Driven by the core values of Knowledge Action Care, the Piramal Group has a formidable presence in healthcare, drug discovery & research, glass, real estate and financial services. The Piramal Group also pursues sustained community activities in healthcare, education, emergency medical services, and heritage restoration. In May 2010, one of Piramal Group’s companies Piramal Healthcare divested its domestic formulations business to Abbott. The Group’s turnover post this stands at US$650 million.
source - www.ft.lk
Piramal Glass Ceylon Plc (PGC), made record profits for F2011 by performing exceptionally well in all spheres of the business.
Revenue achieved for the year was Rs.4.16 billion witnessing a growth of 18% as against Rs.3.52 billion for the previous year. The Profit After Tax (PAT) was Rs.578 million, equating to 14% of turnover as against the loss of Rs.61 million recorded in F2010. With this exceptional performance the board of directors has declared a first & final dividend of 30%. In 2009/10 the company made a loss of Rs. 61 million.
PGC’s Chief Executive Officer and Executive Director, Sanjay Tiwari while announcing PGC’s results said, “We’re proud to report the best ever annual results for PGC. This year we started reaping the returns of the extensive investments on our new facility at Horana.”
With peace being restored in the region, the domestic market contributed significantly during the year under review. The various segments of local market added towards the domestic market growth of 34% from Rs.2.35 billion to Rs.3.16 billion. Volume wise also there was a growth of 26%.
The main contributor to the profitability was the premium Export Market segment. The company ensured that the export sales crossed the Rs.1 billion mark for the 2nd consecutive year. Several new products were designed and launched in the export market which yielded high realisation to the profitability. The export product portfolio saw a gradual shift from mass market to high end premium market segment yielding higher realisations. Speciality (high end) market segment grew by 24% in volume from 8,607 tonnes to 10,660 tonnes whilst the company voluntarily reduced the mass market segment by 60%.
The manufacturing facility also contributed to ensure a cost effective bottle being produced. Improved efficiencies & speeds contributed towards the final profitability.
During the period the company was able to produce 11% more than the previous year. This helped the company maintain the cost of bottles amidst the raw material cost increases. The unprecedented increase in energy prices namely LPG Gas, electricity tariff & furnace oil has impacted the overall cost of production.
During the year PGC was accredited with ISO 22000:2005 certifications designed for food and safety. The company has already received certification for complying with ISO 9001:2008 Quality Management System. This new accreditation is a testimony to the best in class systems & processors followed by the company.
The continuous achievements of Piramal Glass Ceylon during FY2011 were also recognised by external agencies with several awards. PGC received the Gold Medal in Large Category at National Chamber of Exports Export Awards, Merit Award for Industrial Excellence at Ceylon National Chamber of Industries Achievers Awards, Gold Award in Manufacturing Sector and Silver Award in the Best Tech Savvy Company segment at the National Business Excellence awards organised by the National Chamber of Commerce Sri Lanka, and a Bronze Award at the Lanka Star 2010 organised by Sri Lanka institute of Packaging.
“We are indeed thrilled at the performance of Piramal Glass Ceylon. This is also evident from the closing share price which has grown 5 times as compared to 31 March 2010. Market Capitalisation crossed Rs.10.5 billion as compared to Rs.2.1 billion at the beginning of the year,” Tiwari added.
Vijay Shah Chairman Piramal Glass Ceylon Plc said, “We are confident that with the growing domestic markets coupled with potential of premium export market, the company would continue to strive towards excellent performance in the future too. We also would like to acknowledge the trust and confidence placed by our stake holders. We have suitably rewarded by way of a proposal of 30% final dividend for the year 2010/11.”
Piramal Glass Limited (“PGL”, erstwhile Gujarat Glass Limited) is a leading global manufacturer of flaconnage (glass containers) for pharmaceuticals, foods & beverages and cosmetics and perfumery industries. The company had revenues of Rs. 1,100 crores in FY2010. PGL has a global footprint, with manufacturing facilities located in USA, Sri Lanka and India. The company markets its products to more than 54 countries across the globe. The company is also the largest producer of nail-polish bottles globally, with more than 30% market share. PGL is listed on the National Stock Exchange, the Bombay Stock Exchange and Ahmedabad Stock Exchange (Ticker: 20219).
The Piramal Group led by Ajay G. Piramal is one of India’s foremost business conglomerates. Driven by the core values of Knowledge Action Care, the Piramal Group has a formidable presence in healthcare, drug discovery & research, glass, real estate and financial services. The Piramal Group also pursues sustained community activities in healthcare, education, emergency medical services, and heritage restoration. In May 2010, one of Piramal Group’s companies Piramal Healthcare divested its domestic formulations business to Abbott. The Group’s turnover post this stands at US$650 million.
source - www.ft.lk
Stock market stagnant
The Colombo stock market continued its struggle with lackluster performance except for a few strategic and speculative deals.
A crossing of 1.4 million shares of Commercial for Rs. 378 million was the highlight with buyer believed to be EPF and seller the Japanese fund SBI Venture Holdings. The share price increased by Rs. 3.60 (1.33%) and closed at Rs. 266. Foreign holding of the company decreased by 1,000,000 shares.
The benchmark ASPI gained marginally by 3 points whilst MPI dipped by 18 points on a day when only Rs. 1.3 billion turnover was generated. Contrary to Monday’s net inflow, foreigners were net sellers to the tune of Rs. 277 million. Motor stocks continued their dip over the recent increase in import duties but Lanka Ashok surprisingly topped the gainers list up 16% or Rs. 624.70 to close at Rs. 4,579.50 (peaked to Rs. 4,800) on a volume of 2,300 shares. There was renewed interest on SLT which gained by over 6% to close at Rs. 59.
"The indices remained stagnant as gains on few large cap counters such as SLTL and BUKI were offset by declining prices across the board while turnover was dominated by local investors amid foreign selling," John Keells Stock Brokers said.
NDB Stockbrokers headlined its view as “Stagnant market” noting that indices were mostly stagnant during the day. However, MPI closed in red as blue chip stocks failed to appreciate amidst dull investor participation.
The Bank, Finance and Insurance sector was the main contributor to the market turnover (due to Commercial Bank) with the sector index increasing 1.12%.
Reuters said the stock market closed firmer in thin turnover on Tuesday from four-week lows as gains in telecom shares offset losses in financials as cautious investors awaited quarterly earnings and foreign investors were net sellers.
Rising inflation and an adverse war crime report by a U.N.-appointed panel, which may have an impact in Sri Lanka’s future foreign investments weighed on sentiment, resulting in light turnover, analysts said.
Foreign investors sold a net 277 million rupees’ worth of shares. They have sold a net 7.83 billion in 2011, and a record 26.4 billion in 2010.
The bourse is still Asia’s best performer in 2011 with a 10.8 percent gain, after bringing in the region’s top return of 96 percent last year.
The rupee closed flat at 110.18/20 a dollar on low trading volumes, dealers said. The Central Bank has forecast further appreciation this year.
source - www.ft.lk
A crossing of 1.4 million shares of Commercial for Rs. 378 million was the highlight with buyer believed to be EPF and seller the Japanese fund SBI Venture Holdings. The share price increased by Rs. 3.60 (1.33%) and closed at Rs. 266. Foreign holding of the company decreased by 1,000,000 shares.
The benchmark ASPI gained marginally by 3 points whilst MPI dipped by 18 points on a day when only Rs. 1.3 billion turnover was generated. Contrary to Monday’s net inflow, foreigners were net sellers to the tune of Rs. 277 million. Motor stocks continued their dip over the recent increase in import duties but Lanka Ashok surprisingly topped the gainers list up 16% or Rs. 624.70 to close at Rs. 4,579.50 (peaked to Rs. 4,800) on a volume of 2,300 shares. There was renewed interest on SLT which gained by over 6% to close at Rs. 59.
"The indices remained stagnant as gains on few large cap counters such as SLTL and BUKI were offset by declining prices across the board while turnover was dominated by local investors amid foreign selling," John Keells Stock Brokers said.
NDB Stockbrokers headlined its view as “Stagnant market” noting that indices were mostly stagnant during the day. However, MPI closed in red as blue chip stocks failed to appreciate amidst dull investor participation.
The Bank, Finance and Insurance sector was the main contributor to the market turnover (due to Commercial Bank) with the sector index increasing 1.12%.
Reuters said the stock market closed firmer in thin turnover on Tuesday from four-week lows as gains in telecom shares offset losses in financials as cautious investors awaited quarterly earnings and foreign investors were net sellers.
Rising inflation and an adverse war crime report by a U.N.-appointed panel, which may have an impact in Sri Lanka’s future foreign investments weighed on sentiment, resulting in light turnover, analysts said.
Foreign investors sold a net 277 million rupees’ worth of shares. They have sold a net 7.83 billion in 2011, and a record 26.4 billion in 2010.
The bourse is still Asia’s best performer in 2011 with a 10.8 percent gain, after bringing in the region’s top return of 96 percent last year.
The rupee closed flat at 110.18/20 a dollar on low trading volumes, dealers said. The Central Bank has forecast further appreciation this year.
source - www.ft.lk
From banks to shipping
Colombo Dockyard Plc (DOCK) yesterday informed the Colombo Stock Exchange that state- owned Sri Lanka Insurance Corporation, having acquired a 10 percent stake in the company, has expressed its intention to appoint a nominee director to DOCK’s director board.
As per the filing, SLIC’s General Fund owns 3,421,903 or 5 percent of DOCK, while Life Fund holds 3,421,475 shares or 4.999 percent of DOCK.
As per the December 31, 2010 interim reports, SLIC had the same shareholding in DOCK. However, it’s not clear as to why they have suddenly asked for a board seat. The filing also has not indicated any clear reason.
The matter of appointing government nominees to the director boards of publicly listed companies has now become a debatable issue.
According to certain analysts, the government is making inroads to these companies to control and influence the decision making process.
The most recent examples of this saga have been the appointment of Lakshman Hullugalle to the board of Commercial Bank and ex-Central Banker Ranee Jayamaha (as the Chairperson) to Hatton National Bank.
source - www.dailymirror.lk
As per the filing, SLIC’s General Fund owns 3,421,903 or 5 percent of DOCK, while Life Fund holds 3,421,475 shares or 4.999 percent of DOCK.
As per the December 31, 2010 interim reports, SLIC had the same shareholding in DOCK. However, it’s not clear as to why they have suddenly asked for a board seat. The filing also has not indicated any clear reason.
The matter of appointing government nominees to the director boards of publicly listed companies has now become a debatable issue.
According to certain analysts, the government is making inroads to these companies to control and influence the decision making process.
The most recent examples of this saga have been the appointment of Lakshman Hullugalle to the board of Commercial Bank and ex-Central Banker Ranee Jayamaha (as the Chairperson) to Hatton National Bank.
source - www.dailymirror.lk
Commercial Credit to list shares
Commercial Credit Limited, a Regisered Finance Company (RFC) in the country yesterday said it has decided to list 218, 074, 365 Ordinary Voting Shares in the Colombo Stock Exchange’s (CSE) Diri Savi board by way of an Introduction.
“The ordinary shares will be granted a listing on or before the 3 market days, upon receipt of the declaration from the company,” CSE said in a filing.
Sri Lanka’s Central Bank has directed all the RFCs to list in the CSE. Two RFCs, Senkadagala Finance and Chilaw Finance recently listed their shares in the CSE by way of Introduction, following the directive.
source - www.dailymirror.lk
“The ordinary shares will be granted a listing on or before the 3 market days, upon receipt of the declaration from the company,” CSE said in a filing.
Sri Lanka’s Central Bank has directed all the RFCs to list in the CSE. Two RFCs, Senkadagala Finance and Chilaw Finance recently listed their shares in the CSE by way of Introduction, following the directive.
source - www.dailymirror.lk
Expolanka announces IPO
By Jithendra Antonio
One of the leading and most diversified family businesses of Sri Lanka, Expo Lanka Holdings (EXPO) yesterday announced its much awaited Initial Public Offering (IPO). The company intends to issue 172 million ordinary voting shares at Rs.14 per share, on May 12.
Chief Executive officer of Expolanka Holdings Hanif Yusoof said the IPO marks a significant milestone. “These are exciting times for Expolanka, and we expect to raise Rs.2.4 billion” Yusoof said adding that the company primarily intends to allocate IPO proceeds to enhance working capital, expand warehouse capacity and reduce long term debt.
Accordingly, nearly Rs.1 billion will be allotted to working capital enhancement, Rs.500 million will be allocated to Group’s expansion of existing warehouse and another Rs.908 million to reduce the company’s long term debt outstanding.
With a consolidated turnover of over Rs.25.82 billion for the 9 months period ending 31 December 2010, and 46 subsidiaries and joint venture companies in over 11 countries and 38 cities, the group has expanded its breadth and size within a relatively short space of operation since its inception.
Yusoof stressed that Expolanka group’s major revenue comes from its foreign subsidiaries that amounts to 60%, while the group’s freight forwarding subsidiaries are the major cash cows.
Meanwhile Yusoof also stressed that the two subsidiaries were disposed completely to focus more on growth-driven businesses.
“We realized that given the volatility of the aviation industry and constraints faced by the textile industries, those two subsidiaries cannot deliver much to our shareholders” Yusoof added. Prior to the IPO, Expolanka IPO had divested Expolanka Aviation and Denshun Industries, earning a capital gain of Rs.313 million.
Explaining about future company strategies Yusoof said that Expolanka plans to establish offices in the southern region to facilitate the increased business potential in cargo volumes derived from the Hambantota Port development project. He also outlined Expolanka’s plans to increase the production capacity for exports, strengthening the network for packaged Teas (T-Sips) both locally and internationally.
Incorporated in 2003, Expolanka Holdings Limited is the holding company of Expolanka Group that commenced in 1978, and the company has diversified interests in transportation, international trading, manufacturing and strategic investments sectors. The company’s financials outline that the company’s Earnings Per Share had increased from Rs. 2.15 to Rs. 2.77 in the first nine months of 2011.
source - www.dailymirror.lk
One of the leading and most diversified family businesses of Sri Lanka, Expo Lanka Holdings (EXPO) yesterday announced its much awaited Initial Public Offering (IPO). The company intends to issue 172 million ordinary voting shares at Rs.14 per share, on May 12.
Chief Executive officer of Expolanka Holdings Hanif Yusoof said the IPO marks a significant milestone. “These are exciting times for Expolanka, and we expect to raise Rs.2.4 billion” Yusoof said adding that the company primarily intends to allocate IPO proceeds to enhance working capital, expand warehouse capacity and reduce long term debt.
Accordingly, nearly Rs.1 billion will be allotted to working capital enhancement, Rs.500 million will be allocated to Group’s expansion of existing warehouse and another Rs.908 million to reduce the company’s long term debt outstanding.
With a consolidated turnover of over Rs.25.82 billion for the 9 months period ending 31 December 2010, and 46 subsidiaries and joint venture companies in over 11 countries and 38 cities, the group has expanded its breadth and size within a relatively short space of operation since its inception.
Yusoof stressed that Expolanka group’s major revenue comes from its foreign subsidiaries that amounts to 60%, while the group’s freight forwarding subsidiaries are the major cash cows.
Meanwhile Yusoof also stressed that the two subsidiaries were disposed completely to focus more on growth-driven businesses.
“We realized that given the volatility of the aviation industry and constraints faced by the textile industries, those two subsidiaries cannot deliver much to our shareholders” Yusoof added. Prior to the IPO, Expolanka IPO had divested Expolanka Aviation and Denshun Industries, earning a capital gain of Rs.313 million.
Explaining about future company strategies Yusoof said that Expolanka plans to establish offices in the southern region to facilitate the increased business potential in cargo volumes derived from the Hambantota Port development project. He also outlined Expolanka’s plans to increase the production capacity for exports, strengthening the network for packaged Teas (T-Sips) both locally and internationally.
Incorporated in 2003, Expolanka Holdings Limited is the holding company of Expolanka Group that commenced in 1978, and the company has diversified interests in transportation, international trading, manufacturing and strategic investments sectors. The company’s financials outline that the company’s Earnings Per Share had increased from Rs. 2.15 to Rs. 2.77 in the first nine months of 2011.
source - www.dailymirror.lk
March 2011 tea production significantly higher
Sri Lanka has recorded a crop of 33.2 MKgs in March, 2011, which is significantly higher than what was achieved during the corresponding month last year where only 21 MKgs was produced.
The largest gain of six MKgs month-on-month is seen from the low grown category, followed by the high and medium elevations with surpluses of 3.7 MKgs and 2.4 MKgs, respectively.
During the period January-March, 2011, the total production is 76.2 MKgs which is inclusive of the adjustments made for late returns received from factories in respect of January and February. The year to date production is 2.2 MKgs ahead of what was achieved during the same period last year.
source - www.dailynews.lk
The largest gain of six MKgs month-on-month is seen from the low grown category, followed by the high and medium elevations with surpluses of 3.7 MKgs and 2.4 MKgs, respectively.
During the period January-March, 2011, the total production is 76.2 MKgs which is inclusive of the adjustments made for late returns received from factories in respect of January and February. The year to date production is 2.2 MKgs ahead of what was achieved during the same period last year.
source - www.dailynews.lk
Market ends marginally positive
No expressive trend was indicated when market shut its operations with both indices closing in opposites yesterday.
The market held the negative zone in most part of trading but the market nudged higher in late trading to end marginally positive. ASI gained marginally by 3.69 points (+0.05 percent) to close at 7,349.17 and liquid MPI dropped 18.73 points (-0.27 percent) to close trading at 6,836.54. The market turnover was Rs 1.4 billion. Commercial Bank Plc (Rs 387.5 million) was the top contributor to the turnover with two off-the-floor deals of 1.4 million shares at a price of Rs 270.
In addition National Lanka Finance Plc (Rs 94.4 million) and Central Finance Company Plc (Rs 49.9 million) contributed heavily to the daily turnover. In the meantime high levels of trading were witnessed in Free Lanka Capital Holdings Plc, People s Leasing Finance Plc and Union Bank Plc. Foreign participation was picked up to 21.09 percent of the total market activity. At the end of the day foreign investors were the net sellers with a net foreign outflow of Rs 277 million. Lanka Securities Research
source - www.dailynews.lk
The market held the negative zone in most part of trading but the market nudged higher in late trading to end marginally positive. ASI gained marginally by 3.69 points (+0.05 percent) to close at 7,349.17 and liquid MPI dropped 18.73 points (-0.27 percent) to close trading at 6,836.54. The market turnover was Rs 1.4 billion. Commercial Bank Plc (Rs 387.5 million) was the top contributor to the turnover with two off-the-floor deals of 1.4 million shares at a price of Rs 270.
In addition National Lanka Finance Plc (Rs 94.4 million) and Central Finance Company Plc (Rs 49.9 million) contributed heavily to the daily turnover. In the meantime high levels of trading were witnessed in Free Lanka Capital Holdings Plc, People s Leasing Finance Plc and Union Bank Plc. Foreign participation was picked up to 21.09 percent of the total market activity. At the end of the day foreign investors were the net sellers with a net foreign outflow of Rs 277 million. Lanka Securities Research
source - www.dailynews.lk
Dull day on CSE with ASPI edging up & Milanka down
The Colombo bourse remained lackluster yesterday although the All Share Price Index was up a marginal 3.69 points (0.05%) while the Milanka was down 18.73 points (0.27%) on a disappointing turnover of Rs.1.4 billion, down from the previous day’s Rs.1.5 billion with 137 losers ahead of 70 gainers.
"It was quite a dull day with the All Share picking up a little towards close of trading but losing much of the gain when the marked closed," Prashan Fernando of Acuity Stockbrokers said. "The day’s top turnover came from Commercial Bank where there were two crossings, a million shares at Rs.270 and 401,402 shares also at the same price."
ComBank with over 1.4 million shares done lost Rs.3.60 to close at Rs.266 on a trading range of Rs.265 to Rs.270.
Nation Lanka Finance, with nearly 8.2 million shares traded was down 30 cents to Rs.11.70 with a million shares done on the trading floor at Rs.11.50. The share traded yesterday between Rs.11.40 and Rs.12 with brokers saying there seemed to have been one big seller at the Rs. 11.50 price.
Central Finance attracted some interest with 35,000 shares done between Rs.1,405 and Rs.1,450 dipping Rs.29.70 to close at Rs.1,424.
On the green side of the trading board with counters that showed some quantity were Browns, up Rs. 3.30 to close at Rs.321 on over 0.1 million shares, SLT up Rs.3.50 to close at Rs.59 on nearly 0.6 million shares and Guardian up 50 cents to close at Rs.385 on 63,800 shares.
Watapota was up Rs.6.10 to Rs.258.90 on 68,100 shares and Distilleries up 60 cents to Rs.182 on 89,600 shares.
Four Carsons plantation companies with estates in Malaysia declared first and final dividends for 2010/11 following shareholder approval at AGMs on June 3. They will trade XD on June 6 and payment will be on June 14.
Selinsing will pay Rs.20.60 per share, Indo Malay Rs.10.60 per share, Good Hope Rs.14.05 per share and Shalimar Rs.14 per share.
source - www.island.lk
"It was quite a dull day with the All Share picking up a little towards close of trading but losing much of the gain when the marked closed," Prashan Fernando of Acuity Stockbrokers said. "The day’s top turnover came from Commercial Bank where there were two crossings, a million shares at Rs.270 and 401,402 shares also at the same price."
ComBank with over 1.4 million shares done lost Rs.3.60 to close at Rs.266 on a trading range of Rs.265 to Rs.270.
Nation Lanka Finance, with nearly 8.2 million shares traded was down 30 cents to Rs.11.70 with a million shares done on the trading floor at Rs.11.50. The share traded yesterday between Rs.11.40 and Rs.12 with brokers saying there seemed to have been one big seller at the Rs. 11.50 price.
Central Finance attracted some interest with 35,000 shares done between Rs.1,405 and Rs.1,450 dipping Rs.29.70 to close at Rs.1,424.
On the green side of the trading board with counters that showed some quantity were Browns, up Rs. 3.30 to close at Rs.321 on over 0.1 million shares, SLT up Rs.3.50 to close at Rs.59 on nearly 0.6 million shares and Guardian up 50 cents to close at Rs.385 on 63,800 shares.
Watapota was up Rs.6.10 to Rs.258.90 on 68,100 shares and Distilleries up 60 cents to Rs.182 on 89,600 shares.
Four Carsons plantation companies with estates in Malaysia declared first and final dividends for 2010/11 following shareholder approval at AGMs on June 3. They will trade XD on June 6 and payment will be on June 14.
Selinsing will pay Rs.20.60 per share, Indo Malay Rs.10.60 per share, Good Hope Rs.14.05 per share and Shalimar Rs.14 per share.
source - www.island.lk
Overseas Realty to fast track $ 350 m Havelock City
Ravi LADDUWAHETTY
Overseas Realty Ceylon Ltd PLC (ORCL) will fast track the $ 350 million Havelock City project to complete it in three years in the backdrop of growing demand for modern buildings.
The company has decided to fast track the project in the growing demand for residential and office space in the backdrop of sustainable peace, ORCL Group CEO Pravir Samarasinghe told Daily News Business yesterday.
Measures have been taken to fast track the project with simultaneous development of the balance of the residential phases and the commercial component which will be spread over 18 acres having four million square feet. Phases three and four will be completed next year.
Under Phase 1, Park Towers and Elibank Towers comprises a total of 226 apartments.
Over 95 percent of these apartments have been sold, and Phase 2, Layards and Davidson Towers comprise a total of 225 apartments and 25 percent have been sold already.
Both towers have 22 levels each and include a combination of 2,3, 4 bedroom apartments and penthouses.
The piling has been completed and construction will commence in August, he said.
Commenting on the potential of the backdrop for property development ORCL Chairman S P Tao in his annual report told shareholders: “The resolution of the conflict that has lasted 30 years has ushered in peace and a stable government focused on developing the country to claim its rightful place in South Asia and eventually the global economy. Certainly, there are tremendous opportunities for city planning and development to cater to urbanisation and service related industries, all of which would require more and better modern buildings to enhance performance and efficiency.
This is also a clarion call to our Company to seize the challenge to build the balance 3.5 million square feet in Havelock City to be ready for the inevitable demand in the future.
source - www.dailynews.lk
Overseas Realty Ceylon Ltd PLC (ORCL) will fast track the $ 350 million Havelock City project to complete it in three years in the backdrop of growing demand for modern buildings.
The company has decided to fast track the project in the growing demand for residential and office space in the backdrop of sustainable peace, ORCL Group CEO Pravir Samarasinghe told Daily News Business yesterday.
Measures have been taken to fast track the project with simultaneous development of the balance of the residential phases and the commercial component which will be spread over 18 acres having four million square feet. Phases three and four will be completed next year.
Under Phase 1, Park Towers and Elibank Towers comprises a total of 226 apartments.
Over 95 percent of these apartments have been sold, and Phase 2, Layards and Davidson Towers comprise a total of 225 apartments and 25 percent have been sold already.
Both towers have 22 levels each and include a combination of 2,3, 4 bedroom apartments and penthouses.
The piling has been completed and construction will commence in August, he said.
Commenting on the potential of the backdrop for property development ORCL Chairman S P Tao in his annual report told shareholders: “The resolution of the conflict that has lasted 30 years has ushered in peace and a stable government focused on developing the country to claim its rightful place in South Asia and eventually the global economy. Certainly, there are tremendous opportunities for city planning and development to cater to urbanisation and service related industries, all of which would require more and better modern buildings to enhance performance and efficiency.
This is also a clarion call to our Company to seize the challenge to build the balance 3.5 million square feet in Havelock City to be ready for the inevitable demand in the future.
source - www.dailynews.lk
Lankan multinational Expolanka in Rs. 2.4mn IPO
Expolanka Holdings Ltd., Sri Lanka’s little known diversified multinational company operating in 38 cities across 12 countries, is planning to raise a little more than Rs. 2.4 billion through an initial public offering (IPO) which would see 27 percent of its shares listed on the Colombo Stock Exchange.
The offer for 172 million ordinary voting shares at Rs. 14 each opens on May 12 and the subscription list would close on June 2, unless the issue is oversubscribed before then.
The proceeds of the IPO would be put to use almost immediately.
Expolanka Holdings CFO Mushtaq Ahamed speaking to journalists yesterday (26) said the company envisages growth across diverse sectors. "We resorted to bridging finance to fund our strategic expansion plans and the proceeds of the IPO would be used to enhance working capital, retire long term debt and in strategic investments. Growth is coming and it is not limited to Colombo," he said.
Out of the funds raised, the company will utilise Rs. 908 million to reduce outstanding long-term debt amounting to Rs. 1.8 billion. This would be done from August 2011.
Expolanka will use Rs. 1 billion to enhance its working capital of specific entities of the group with a view to increase operating capacity, measured by the volume of activity at its main business segments. The proceeds will be managed by the Corporate Treasury Department of Expolanka Holdings Limited and will be supplied on demand to group entities under a suitable return. The company expects to commence utilising the proceeds from June 2011.
The company will use a further Rs. 500 million to expand its existing warehouse capacity to supplement the group’s expansion into the local transport and logistics sector from September 2011.
According to Expolanka Holdings Group CEO Hanif Yusoof, this Rs. 500 million would be used to design a warehouse on a 4 acre plot of land owned by the group that would cater exclusively to the country’s booming fashion industry, he told journalists in Colombo yesterday (26).
Diversified…
The group’s main line of business is in logistics, accounting for 71 percent of group profits of Rs. 1.92 billion for the nine-months ending December 31, 2010, contributing 53 percent of group revenue amounting to Rs. 25.8 billion for the same period.
Expolanka’s freight forwarding operations are among the fifth largest in India and the biggest in Bangladesh. It recently opened an office in the Philippines and acquired a freight forwarding company that has access to Australia and China, Yusoof said.
The group is also in the commodities exports business, its fresh fruits and fruit drinks being popular in the Middle East. It also exports tea in bulk and value added form. The group also maintains fruit plantations. "Agricultural exports are going to be big. The Middle Eastern market is already there for the taking," Yusoof said.
It also recycles and exports waste-paper and, according to the group it commands a 19 percent market share.
Yusoof said the group had entered into general service agreements with several leading airlines.
Expolanka also operates a BPO. In 2002, HelloCorp was established as the first-ever BOI approved company in Sri Lanka specialising in BPO services, with the initial phases of the operation being customer support and call centre services for overseas clients. HelloCorp specialises in providing Business Process Outsourcing services to clients spread around the world. The focus of the business lies in providing outsourced services such as finance and accounting, data processing, IT tech support, back office processing, managed outsourcing solutions and other BPO services, the prospectus noted.
Asia Pacific Institute of Information Technology APIIT is a joint venture providing higher education to Sri Lankan and foreign students in the academic areas of Business, IT and Law.
"APIIT started operations in September 1999 with BOI approval, to offer tertiary education, in partnership with the Asia Pacific Institute of Information Technology – Malaysia and Staffordshire University, UK."
Language of the future...
The Expolanka group also operates inbound tour operations. Yusoof said the company was employing Chinese, Indians and others who could command languages of the Balkan states. "These are languages of the future," he said explaining the company’s motives for employing those proficient in various languages in order to attract more tourists into the country.
Pharmaceuticals...
The group has also ventured into herbal pharmaceuticals. Yusoof said the group had commenced research and development activities in this regard for the past ten years.
Group Director Sattar Kassim told The Island Financial Review that the group’s pharmaceuticals factory has expanded from a 7,700 sq ft unit into 60,500 sq ft unit today. " We have the country’s only encapsulation plant," he said, adding that the group was investing heavily in this growth sector.
Allocation of shares...
According to the new rules introduced by the SEC, retail investors would be allocated 68.8 million shares, 40 percent of the issue, while institutional investors have been allocated 35 percent of the issue or 60.2 million shares. Expolanka employees have been allocated 15 percent of the issue while unit trust investors have access to 10 percent.
After tax profits for the group reached Rs. 1.45 billion for the nine months ending December 2010; its profits for the previous financial years is as follows; Rs. 192 million (FY06), Rs. 122 million (FY07), Rs. 8 million (FY08), Rs. 391 million (FY09) and Rs. 591 million (FY10).
Net turnover is as follows; Rs. 11.78 million (FY06), Rs. 12.71 million (FY07), Rs. 15.9 million (FY08), Rs. 18.93 million (FY09), Rs. 23.7 million (FY10) and Rs. 25.82 million (nine months ending December 31, 2010).
Future outlook...
Expolanka intends to capitalise on the overall supply chain improvements the country is to experience with the expansion of the rail network to the North and the East. This will provide the inland transportation sub-sector with growth opportunities. Further, better access to these locations coupled with the infrastructure developments taking place in the telecommunications industry, should enable the group to expand its existing Freight Management operations in the telecommunications sector, Expolanka said in its prospectus.
"This will also complement the extension of the warehouse facility the Group is hoping to establish. The warehouse is located in close proximity to a rail reservation. This modernised distribution centre, which is to be fully operational during the year 2012, will provide the Group with the much needed capacity to meet its customer’s demand for storage and logistics services. The group hopes to establish itself firmly on the overall supply chain of customers and strengthening the vertical integration by adopting modern service facilities associated with Third Party Logistics.
"Sri Lanka is well positioned to become a consolidation hub, where goods from India, China and Middle East can be consolidated and exported to Europe and the USA, creating growth opportunities for all freight forward companies in the country. Expolanka with its strong regional presence, experience and infrastructure is ideally placed to take advantage of this opportunity.
"Expolanka’s global network of freight forwarding companies allows the Group to be at the forefront of new developments, offering various new products and services, and has allowed the Group to benefit from synergies in its operations. As a strategic investment option, and with a view to increasing efficiencies, the Company is proposing to establish its own agencies in Europe and the US. In addition to the cost factors, the agencies would be able to improve its business processes by canvassing for business with established buyers as well as sourcing new clients, which will result in improved relationships between parties whilst providing stability to the operations.
"The Travel sub sector has plans to extend its branch network locally by establishing travel offices in strategic locations to facilitate access to travel services to all segments in Sri Lanka there by providing individualised services to walk in clients. In addition, the Company hopes to expand its operations through backward integration with hotel chains to provide sales and marketing activities for their establishments.
"Expolanka is planning to increase production capacity in order to meet the demand for its major export produce items such as pineapple, banana, maze, tapioca and various other vegetables. The Company will also commence exploring various new markets," its prospectus said.
source - www.island.lk
The offer for 172 million ordinary voting shares at Rs. 14 each opens on May 12 and the subscription list would close on June 2, unless the issue is oversubscribed before then.
The proceeds of the IPO would be put to use almost immediately.
Expolanka Holdings CFO Mushtaq Ahamed speaking to journalists yesterday (26) said the company envisages growth across diverse sectors. "We resorted to bridging finance to fund our strategic expansion plans and the proceeds of the IPO would be used to enhance working capital, retire long term debt and in strategic investments. Growth is coming and it is not limited to Colombo," he said.
Out of the funds raised, the company will utilise Rs. 908 million to reduce outstanding long-term debt amounting to Rs. 1.8 billion. This would be done from August 2011.
Expolanka will use Rs. 1 billion to enhance its working capital of specific entities of the group with a view to increase operating capacity, measured by the volume of activity at its main business segments. The proceeds will be managed by the Corporate Treasury Department of Expolanka Holdings Limited and will be supplied on demand to group entities under a suitable return. The company expects to commence utilising the proceeds from June 2011.
The company will use a further Rs. 500 million to expand its existing warehouse capacity to supplement the group’s expansion into the local transport and logistics sector from September 2011.
According to Expolanka Holdings Group CEO Hanif Yusoof, this Rs. 500 million would be used to design a warehouse on a 4 acre plot of land owned by the group that would cater exclusively to the country’s booming fashion industry, he told journalists in Colombo yesterday (26).
Diversified…
The group’s main line of business is in logistics, accounting for 71 percent of group profits of Rs. 1.92 billion for the nine-months ending December 31, 2010, contributing 53 percent of group revenue amounting to Rs. 25.8 billion for the same period.
Expolanka’s freight forwarding operations are among the fifth largest in India and the biggest in Bangladesh. It recently opened an office in the Philippines and acquired a freight forwarding company that has access to Australia and China, Yusoof said.
The group is also in the commodities exports business, its fresh fruits and fruit drinks being popular in the Middle East. It also exports tea in bulk and value added form. The group also maintains fruit plantations. "Agricultural exports are going to be big. The Middle Eastern market is already there for the taking," Yusoof said.
It also recycles and exports waste-paper and, according to the group it commands a 19 percent market share.
Yusoof said the group had entered into general service agreements with several leading airlines.
Expolanka also operates a BPO. In 2002, HelloCorp was established as the first-ever BOI approved company in Sri Lanka specialising in BPO services, with the initial phases of the operation being customer support and call centre services for overseas clients. HelloCorp specialises in providing Business Process Outsourcing services to clients spread around the world. The focus of the business lies in providing outsourced services such as finance and accounting, data processing, IT tech support, back office processing, managed outsourcing solutions and other BPO services, the prospectus noted.
Asia Pacific Institute of Information Technology APIIT is a joint venture providing higher education to Sri Lankan and foreign students in the academic areas of Business, IT and Law.
"APIIT started operations in September 1999 with BOI approval, to offer tertiary education, in partnership with the Asia Pacific Institute of Information Technology – Malaysia and Staffordshire University, UK."
Language of the future...
The Expolanka group also operates inbound tour operations. Yusoof said the company was employing Chinese, Indians and others who could command languages of the Balkan states. "These are languages of the future," he said explaining the company’s motives for employing those proficient in various languages in order to attract more tourists into the country.
Pharmaceuticals...
The group has also ventured into herbal pharmaceuticals. Yusoof said the group had commenced research and development activities in this regard for the past ten years.
Group Director Sattar Kassim told The Island Financial Review that the group’s pharmaceuticals factory has expanded from a 7,700 sq ft unit into 60,500 sq ft unit today. " We have the country’s only encapsulation plant," he said, adding that the group was investing heavily in this growth sector.
Allocation of shares...
According to the new rules introduced by the SEC, retail investors would be allocated 68.8 million shares, 40 percent of the issue, while institutional investors have been allocated 35 percent of the issue or 60.2 million shares. Expolanka employees have been allocated 15 percent of the issue while unit trust investors have access to 10 percent.
After tax profits for the group reached Rs. 1.45 billion for the nine months ending December 2010; its profits for the previous financial years is as follows; Rs. 192 million (FY06), Rs. 122 million (FY07), Rs. 8 million (FY08), Rs. 391 million (FY09) and Rs. 591 million (FY10).
Net turnover is as follows; Rs. 11.78 million (FY06), Rs. 12.71 million (FY07), Rs. 15.9 million (FY08), Rs. 18.93 million (FY09), Rs. 23.7 million (FY10) and Rs. 25.82 million (nine months ending December 31, 2010).
Future outlook...
Expolanka intends to capitalise on the overall supply chain improvements the country is to experience with the expansion of the rail network to the North and the East. This will provide the inland transportation sub-sector with growth opportunities. Further, better access to these locations coupled with the infrastructure developments taking place in the telecommunications industry, should enable the group to expand its existing Freight Management operations in the telecommunications sector, Expolanka said in its prospectus.
"This will also complement the extension of the warehouse facility the Group is hoping to establish. The warehouse is located in close proximity to a rail reservation. This modernised distribution centre, which is to be fully operational during the year 2012, will provide the Group with the much needed capacity to meet its customer’s demand for storage and logistics services. The group hopes to establish itself firmly on the overall supply chain of customers and strengthening the vertical integration by adopting modern service facilities associated with Third Party Logistics.
"Sri Lanka is well positioned to become a consolidation hub, where goods from India, China and Middle East can be consolidated and exported to Europe and the USA, creating growth opportunities for all freight forward companies in the country. Expolanka with its strong regional presence, experience and infrastructure is ideally placed to take advantage of this opportunity.
"Expolanka’s global network of freight forwarding companies allows the Group to be at the forefront of new developments, offering various new products and services, and has allowed the Group to benefit from synergies in its operations. As a strategic investment option, and with a view to increasing efficiencies, the Company is proposing to establish its own agencies in Europe and the US. In addition to the cost factors, the agencies would be able to improve its business processes by canvassing for business with established buyers as well as sourcing new clients, which will result in improved relationships between parties whilst providing stability to the operations.
"The Travel sub sector has plans to extend its branch network locally by establishing travel offices in strategic locations to facilitate access to travel services to all segments in Sri Lanka there by providing individualised services to walk in clients. In addition, the Company hopes to expand its operations through backward integration with hotel chains to provide sales and marketing activities for their establishments.
"Expolanka is planning to increase production capacity in order to meet the demand for its major export produce items such as pineapple, banana, maze, tapioca and various other vegetables. The Company will also commence exploring various new markets," its prospectus said.
source - www.island.lk
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