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Sunday, July 31, 2011
Saturday, July 30, 2011
T+5 to be reviewed
By Hiran H.Senewiratne
Stock brokers are now appealing to the Securities and Exchange Commission (SEC) to remove or review the T+5 Rule or five days deadline and the SEC has so far not given any response following repeated appeals from brokers and investors, stock market sources said.
"At present stock brokering firms have to go through difficult tasks due to forced –selling of more than 1000 client or a day because of the T + 5 Rule of the Securities and Exchange Commission (SEC)," leading stock brokering firm said.
However, when the Island Financial Review attempted to get SEC’s view on the matter there were no authorised persons to comment on the topic, its sources said.
The SEC is considering the removal of the five days deadline or T+5 Rule in the future with the constant request from stockbrokers and other investors to the SEC, official attached to Lanka Securities Ltd sources told The Business Review .
On 29 December 2010 the SEC issued a directive which mandated r stock brokering companies to force-sell by the T+ 5 ( transactions plus five days) , securities of buyers, which are in default of settlement by the T+3 Rule.
Therefore, from 7 January 2011 each market day became a T +5 force- selling day, which put every stock brokering company and local investors through a difficult situation whether the market goes up or down, stock brokers said.
With this new rule individual investors are going be affected with this rule because if one passes the five days dead line his/her shares will come under forced sell. This really put individual investors who do business in the Colombo Stock Market under tremendous pressure
A large number of local individual investors have increased significantly, which accounted for 44 per cent of the total stock market turnover, while foreign institutional buyers account only for15 percent of the total market turnover.
source - www.island.lk
Stock brokers are now appealing to the Securities and Exchange Commission (SEC) to remove or review the T+5 Rule or five days deadline and the SEC has so far not given any response following repeated appeals from brokers and investors, stock market sources said.
"At present stock brokering firms have to go through difficult tasks due to forced –selling of more than 1000 client or a day because of the T + 5 Rule of the Securities and Exchange Commission (SEC)," leading stock brokering firm said.
However, when the Island Financial Review attempted to get SEC’s view on the matter there were no authorised persons to comment on the topic, its sources said.
The SEC is considering the removal of the five days deadline or T+5 Rule in the future with the constant request from stockbrokers and other investors to the SEC, official attached to Lanka Securities Ltd sources told The Business Review .
On 29 December 2010 the SEC issued a directive which mandated r stock brokering companies to force-sell by the T+ 5 ( transactions plus five days) , securities of buyers, which are in default of settlement by the T+3 Rule.
Therefore, from 7 January 2011 each market day became a T +5 force- selling day, which put every stock brokering company and local investors through a difficult situation whether the market goes up or down, stock brokers said.
With this new rule individual investors are going be affected with this rule because if one passes the five days dead line his/her shares will come under forced sell. This really put individual investors who do business in the Colombo Stock Market under tremendous pressure
A large number of local individual investors have increased significantly, which accounted for 44 per cent of the total stock market turnover, while foreign institutional buyers account only for15 percent of the total market turnover.
source - www.island.lk
Rally continues for fourth day - Retailers keep bourse flying
The Colombo bourse yesterday closed the week with both indices continuing to fly with the All Share Price Index up 191.82 points (2.88%) and the Milanka up 131.94 points (2.17%) on a turnover of Rs.3.15 billion, up from the previous day’s Rs.1.5 billion, with 206 gainers galloping ahead of 23 losers.
"The market continued its retail run which was somewhat of a chicken run with Grain Elevators, Three Acre Farms and Bairaha moving up very sharply," Prashan Fernando of Acuity Stockbrokers said. "There was a lot of cheer among people who trade in our offices and once gloomy faces were smiling broadly."
Yesterday’s biggest business volume came off Ceylon Guardian Investments which closed Rs.48.10 up at Rs.346.50 on a trading range of Rs.305 to Rs.360 contributing Rs.318.8 million to turnover.
Brokers said that one million of these shares were crossed at a price of Rs.300 but there was no word on buyers or sellers were. Analysts made the point that very few held such quantities.
Among the poultry stock, Grain Elevators was up Rs.35.60 to close at Rs.139 on nearly 2.3 million shares traded between Rs.110.90 and Rs.146 while Three Acre Farms gained Rs.37.60 to close at Rs.138 on nearly 2 million shares done between Rs.107 and Rs.146. Bairaha was up Rs.46.70 to close at Rs.324.10 on 0.4 million done between Rs.290 and Rs.334.
Citrus Leisure (Reefcomber) also saw volume with nearly 2.6 million shares done between Rs.65 and Rs.76.40 but lost Rs.4.20 to close at Rs.75.
Guardian Capital Partners (Watapota) was up Rs.12.60 to close at Rs.203.10 on over 0.5 million shares done between Rs.201 and Rs.223.50 while JKH gained Rs.2.10 to close at Rs.194 on over 0.5 million shares done between Rs.118.50 and Rs.195.50.
Brokers said there was interest evident once again in Environment Resource Investments (Walker & Greig) up Rs.8.70 to Rs.68.90 on 1.4 million shares with Panasian Power (nearly 16.8 million shares), East West Properties (nearly 5.4 million shares), Vallibel One (nearly 2.2 million shares), Orient Garments (over 1.2 million shares), CSF (over 2.3 million shares) and PC House (over 2.7 million shares) were among counters showing volume and upward price movement.
Singer Sri Lanka announced an interim dividend of Rs.1.50 per share for 2010/11 XD from August 9 and payment on August 18 while Ceylon Tobacco announced a second interim dividend of Rs.9.70 per share also for 2010/11 XD on August 8 and payment on August 16. Ceylon Tea Services announced a second dividend of Rs.22.50 per share for 2011 with dates to be notified.
source - www.island.lk
"The market continued its retail run which was somewhat of a chicken run with Grain Elevators, Three Acre Farms and Bairaha moving up very sharply," Prashan Fernando of Acuity Stockbrokers said. "There was a lot of cheer among people who trade in our offices and once gloomy faces were smiling broadly."
Yesterday’s biggest business volume came off Ceylon Guardian Investments which closed Rs.48.10 up at Rs.346.50 on a trading range of Rs.305 to Rs.360 contributing Rs.318.8 million to turnover.
Brokers said that one million of these shares were crossed at a price of Rs.300 but there was no word on buyers or sellers were. Analysts made the point that very few held such quantities.
Among the poultry stock, Grain Elevators was up Rs.35.60 to close at Rs.139 on nearly 2.3 million shares traded between Rs.110.90 and Rs.146 while Three Acre Farms gained Rs.37.60 to close at Rs.138 on nearly 2 million shares done between Rs.107 and Rs.146. Bairaha was up Rs.46.70 to close at Rs.324.10 on 0.4 million done between Rs.290 and Rs.334.
Citrus Leisure (Reefcomber) also saw volume with nearly 2.6 million shares done between Rs.65 and Rs.76.40 but lost Rs.4.20 to close at Rs.75.
Guardian Capital Partners (Watapota) was up Rs.12.60 to close at Rs.203.10 on over 0.5 million shares done between Rs.201 and Rs.223.50 while JKH gained Rs.2.10 to close at Rs.194 on over 0.5 million shares done between Rs.118.50 and Rs.195.50.
Brokers said there was interest evident once again in Environment Resource Investments (Walker & Greig) up Rs.8.70 to Rs.68.90 on 1.4 million shares with Panasian Power (nearly 16.8 million shares), East West Properties (nearly 5.4 million shares), Vallibel One (nearly 2.2 million shares), Orient Garments (over 1.2 million shares), CSF (over 2.3 million shares) and PC House (over 2.7 million shares) were among counters showing volume and upward price movement.
Singer Sri Lanka announced an interim dividend of Rs.1.50 per share for 2010/11 XD from August 9 and payment on August 18 while Ceylon Tobacco announced a second interim dividend of Rs.9.70 per share also for 2010/11 XD on August 8 and payment on August 16. Ceylon Tea Services announced a second dividend of Rs.22.50 per share for 2011 with dates to be notified.
source - www.island.lk
ASI soars
The Colombo Stock market rebounded sharply as benchmark ASI soared to year to date high. ASI advanced by 147.27 index points (2.22%) to close at 6,652.83 while more sensitive MPI closed at 6,078.13, up 134.22 index points (2.26%). The advancing shares far outnumbered the decliners. 229 shares rose while only 21 ones fell and 14 counters closed with no changes.
Daily market turnover was Rs 1.5 billion. Out of the total turnover, Rs 926.9 million cash flowed into the market while Rs 569.7 million cash flowed out.
Market RSI based on All Share Index increased to 42.3 from the previous figure 29.3.
Volatile price trend was seen the speculative counter Swarnamahal Financial Services.
The share price which gained Rs 12.70 yesterday saw a dip in price of Rs 13.20 and closed at Rs 112.00.
Nevertheless with the high retail investor activity the counter emerged as the top contributor to today’s turnover with an amount of Rs 136.9mn.
Guardian Capital Partners (Rs 102.9mn) and Softlogic Holdings (Rs 94.4mn) made notable contributions to the market turnover with heavy trading.
Unfolding corporate earnings for the March-June quarter boosted investor activity on premier counters.
John Keells Holdings profit up 35% for. Stock closed at Rs 190.00, up Rs 3.50. Sampath bank profit up by 52%, Sampath reached the high of Rs 145.00 and closed at Rs 240.90, up Rs 10.90. Ceylon Cold Stores profit up by 58%, the counter gained Rs.19.00 and closed at Rs 365.00.
Poultry sector counters witnessed notable activity levels during the day and closed with considerable gains.
Ceylon Grain Elevators up Rs 16.20, Tree Acre Farms up Rs 22.50 and Bairaha Farms up Rs 24.80.
Further, Vallibel One, Nation Lanka Finance and Browns Investments were among the mostly traded counters. Foreign participation was lower however slightly improved to 7% from yesterday’s figure of 3%.
Foreign investors ended as net sellers with net foreign outflow of Rs 131.6mn.
Lanka Securities Research
source - www.dailynews.lk
Daily market turnover was Rs 1.5 billion. Out of the total turnover, Rs 926.9 million cash flowed into the market while Rs 569.7 million cash flowed out.
Market RSI based on All Share Index increased to 42.3 from the previous figure 29.3.
Volatile price trend was seen the speculative counter Swarnamahal Financial Services.
The share price which gained Rs 12.70 yesterday saw a dip in price of Rs 13.20 and closed at Rs 112.00.
Nevertheless with the high retail investor activity the counter emerged as the top contributor to today’s turnover with an amount of Rs 136.9mn.
Guardian Capital Partners (Rs 102.9mn) and Softlogic Holdings (Rs 94.4mn) made notable contributions to the market turnover with heavy trading.
Unfolding corporate earnings for the March-June quarter boosted investor activity on premier counters.
John Keells Holdings profit up 35% for. Stock closed at Rs 190.00, up Rs 3.50. Sampath bank profit up by 52%, Sampath reached the high of Rs 145.00 and closed at Rs 240.90, up Rs 10.90. Ceylon Cold Stores profit up by 58%, the counter gained Rs.19.00 and closed at Rs 365.00.
Poultry sector counters witnessed notable activity levels during the day and closed with considerable gains.
Ceylon Grain Elevators up Rs 16.20, Tree Acre Farms up Rs 22.50 and Bairaha Farms up Rs 24.80.
Further, Vallibel One, Nation Lanka Finance and Browns Investments were among the mostly traded counters. Foreign participation was lower however slightly improved to 7% from yesterday’s figure of 3%.
Foreign investors ended as net sellers with net foreign outflow of Rs 131.6mn.
Lanka Securities Research
source - www.dailynews.lk
CleanCo gears up for IPO with MTI strategy
CleanCo Lanka, providers of nation-wide 'Drive Green' vehicle emissions testing, completed a business performance consulting initiative with regional business strategy consultancy MTI Consulting.
CleanCo Directors with MTI team - Akbar Brothers Group Executive Director Asgi Akbarally, CleanCo Lanka CEO Huzefa Akbarally, MTI CEO Hilmy Cader, MTI Project Consultant Yusuf Isaam and MTI Corporate Services Business Lead Kapila Liyanage.
The extensive project covering corporate risk, governance and marketing communication strategy was augmented by a comprehensive business process engineering initiative. During the course of the project the CleanCo teams were engaged through a series of consulting workshops and clinics involving wide cross functional involvement. Primary research was also undertaken on customer and market conditions. The project was aimed at preparing the business for the next level of corporate performance, in line with shareholder and other stakeholder expectations.
CleanCo CEO Huzefa Akbarally said, "This project has provided us with the strong framework for driving improved performance not only by helping with next-level business processes, but particularly by engaging our team in defining how they will drive our growth."
Commenting on the successful outcome of the project, MTI's Project Consultant Yusuf Isaam said, "Team engagement and focus on actionable initiatives has been MTI's core focus - the team is well poised as CleanCo builds on the strong platform of solid technical capabilities, business fundamentals and ethics."
source - www.dailynews.lk
CleanCo Directors with MTI team - Akbar Brothers Group Executive Director Asgi Akbarally, CleanCo Lanka CEO Huzefa Akbarally, MTI CEO Hilmy Cader, MTI Project Consultant Yusuf Isaam and MTI Corporate Services Business Lead Kapila Liyanage.
The extensive project covering corporate risk, governance and marketing communication strategy was augmented by a comprehensive business process engineering initiative. During the course of the project the CleanCo teams were engaged through a series of consulting workshops and clinics involving wide cross functional involvement. Primary research was also undertaken on customer and market conditions. The project was aimed at preparing the business for the next level of corporate performance, in line with shareholder and other stakeholder expectations.
CleanCo CEO Huzefa Akbarally said, "This project has provided us with the strong framework for driving improved performance not only by helping with next-level business processes, but particularly by engaging our team in defining how they will drive our growth."
Commenting on the successful outcome of the project, MTI's Project Consultant Yusuf Isaam said, "Team engagement and focus on actionable initiatives has been MTI's core focus - the team is well poised as CleanCo builds on the strong platform of solid technical capabilities, business fundamentals and ethics."
source - www.dailynews.lk
CTC contributes Rs.30.6 bn to govt revenues in 2Q
Ceylon Tobacco Company contributed Rs.30.6 bn to government revenues in the 2nd Quarter of 2011. It was an increase of Rs.5.1 bn over last year. This is mainly attributed to positive business environment especially in the North and East, significant increase in tourism and active enforcement by law enforcement agencies to minimise counterfeit and smuggled cigarettes in the country. CTC’s profit after tax stood at Rs.2.6 bn, growth of Rs.0.9 bn over last year.
The law enforcement agencies which continued to make commendable efforts in minimising the growth of illicit products entering the market conducted a total of 235 raids in the first six months of 2011, resulting in confiscation of 30 mn illegal sticks with a market value of Rs.480 mn. Company’s flagship CSR programme, Sustainable Agricultural Development Programme (SADP) continues to progress.
The total number of families in the programme has now grown to 9,864 in 12 districts. So far, 3,843 families have completed the programme which will help them to reach a measure of economic self-sufficiency.
The Directors recommend a second interim dividend of Rs.9.70 per share will be paid on the 16th of August 2011.
source - www.dailymirror.lk
The law enforcement agencies which continued to make commendable efforts in minimising the growth of illicit products entering the market conducted a total of 235 raids in the first six months of 2011, resulting in confiscation of 30 mn illegal sticks with a market value of Rs.480 mn. Company’s flagship CSR programme, Sustainable Agricultural Development Programme (SADP) continues to progress.
The total number of families in the programme has now grown to 9,864 in 12 districts. So far, 3,843 families have completed the programme which will help them to reach a measure of economic self-sufficiency.
The Directors recommend a second interim dividend of Rs.9.70 per share will be paid on the 16th of August 2011.
source - www.dailymirror.lk
Amãna Bank to commence operations on August 1
Amãna Bank, Sri Lanka’s first licensed commercial bank to operate fully under the principles of Islamic banking, opens for business on August 1. A simple launch event to mark the opening was held at the Bank’s Corporate Office with the Governor of the Central Bank of Sri Lanka, Ajith Nivard Cabraal attending as the Chief Guest.
Breaking new ground and carrying Islamic banking products to all Sri Lankans, the Bank launches itself through the statement, “It’s Your Bank.”
It stands on the steadfast belief that it is a unique banking concept in line with everyone’s faiths, principles and expectations; it is a Bank that yearns to ensure prosperity and true happiness to all customers through its unique, humane and honourable values.
Islamic banking is in fact a concept gaining fast popularity and acceptance across the world. Guided by strong values and ethics the banking model has shown great resilience during the recent global economic downturn and as a result is now emerging as a popular alternative to conventional banking.
Amãna Bank will be offering a range of financial products and services including Current Accounts, Savings Accounts, Children’s Savings Account, Term Investment Accounts, Home Financing, SME Banking, Corporate Banking, Trade Services and Treasury Services. It will be opening its doors to the public across 14 branch locations with presence in Colombo 3 (Main Branch and Ladies’ Branch), Pettah, Kandy, Kurunegala, Akurana, Gampola, Mawanella, Galle, Oddamavadi, Kattankudy, Kalmunai, Akkaraipattu and Sammanthurai.
source - www.dailymirror.lk
Breaking new ground and carrying Islamic banking products to all Sri Lankans, the Bank launches itself through the statement, “It’s Your Bank.”
It stands on the steadfast belief that it is a unique banking concept in line with everyone’s faiths, principles and expectations; it is a Bank that yearns to ensure prosperity and true happiness to all customers through its unique, humane and honourable values.
Islamic banking is in fact a concept gaining fast popularity and acceptance across the world. Guided by strong values and ethics the banking model has shown great resilience during the recent global economic downturn and as a result is now emerging as a popular alternative to conventional banking.
Amãna Bank will be offering a range of financial products and services including Current Accounts, Savings Accounts, Children’s Savings Account, Term Investment Accounts, Home Financing, SME Banking, Corporate Banking, Trade Services and Treasury Services. It will be opening its doors to the public across 14 branch locations with presence in Colombo 3 (Main Branch and Ladies’ Branch), Pettah, Kandy, Kurunegala, Akurana, Gampola, Mawanella, Galle, Oddamavadi, Kattankudy, Kalmunai, Akkaraipattu and Sammanthurai.
source - www.dailymirror.lk
Friday, July 29, 2011
Sri Lanka SEC no proposal to reinstate margin trading by brokerage
COLOMBO: Sri Lanka's Securities and Exchange Commission (SEC) on Friday said it had been given no proposal by brokerages to withdraw a plan to end margin trading by the year's end, which has frustrated brokers by dampening trading volumes and prices.
Market speculation that the SEC may ease up the restriction drove the Colombo Stock Exchange up by 6.8 percent in four sessions this week, from a 7-month-low that also saw it dip into negative growth on the year for the first time since 2008.
Seven stockbrokers from different trading houses told Reuters on condition of anonymity that 26 of Sri Lanka's 28 brokerages on Monday gave a proposal to the SEC requesting among other things, a reversal of the margin phase-out.
"We have not still got any request coming from anyone," SEC Director General Malik Cader told Reuters. "I have not got any proposals."
However, a senior official of the Colombo Stockbrokers Association on Friday confirmed the proposal had been submitted, and the official said the SEC had given signs it would review it with an open mind.
"We from the association have submitted the proposal, requesting mainly to ease the credit rules," the official told Reuters on condition of anonymity. "There is no confirmation that they will agree to all our proposals."
Sri Lanka's relatively small bourse was Asia's top performer in 2009 and 2010, gaining 341 percent since Jan. 1, 2009, when it was clear the government would win a 25-year civil war.
That said, it has struggled to garner significant foreign investment, because it has few stocks with a large enough free float to entice outsiders and there is long-standing concern its regulation particularly over insider trading is lax.
So the SEC has increasingly tightened oversight, and that has met with resistance and outright criticism from the clubby bourse's big players and brokers, who are used to a laissez-faire market.
All the brokers Reuters spoke to said with SEC's phased-out of margin dealing and increased supervision of trading has stifled growth. Many brokers blame the bourse's flat run this year to the new strictures, which the proposal seeks to ease.
"We have requested the regulator to allow credit at least up to a limit where brokers have cash," one broker said referring to a request in the proposal.
source - www.brecorder.com
Market speculation that the SEC may ease up the restriction drove the Colombo Stock Exchange up by 6.8 percent in four sessions this week, from a 7-month-low that also saw it dip into negative growth on the year for the first time since 2008.
Seven stockbrokers from different trading houses told Reuters on condition of anonymity that 26 of Sri Lanka's 28 brokerages on Monday gave a proposal to the SEC requesting among other things, a reversal of the margin phase-out.
"We have not still got any request coming from anyone," SEC Director General Malik Cader told Reuters. "I have not got any proposals."
However, a senior official of the Colombo Stockbrokers Association on Friday confirmed the proposal had been submitted, and the official said the SEC had given signs it would review it with an open mind.
"We from the association have submitted the proposal, requesting mainly to ease the credit rules," the official told Reuters on condition of anonymity. "There is no confirmation that they will agree to all our proposals."
Sri Lanka's relatively small bourse was Asia's top performer in 2009 and 2010, gaining 341 percent since Jan. 1, 2009, when it was clear the government would win a 25-year civil war.
That said, it has struggled to garner significant foreign investment, because it has few stocks with a large enough free float to entice outsiders and there is long-standing concern its regulation particularly over insider trading is lax.
So the SEC has increasingly tightened oversight, and that has met with resistance and outright criticism from the clubby bourse's big players and brokers, who are used to a laissez-faire market.
All the brokers Reuters spoke to said with SEC's phased-out of margin dealing and increased supervision of trading has stifled growth. Many brokers blame the bourse's flat run this year to the new strictures, which the proposal seeks to ease.
"We have requested the regulator to allow credit at least up to a limit where brokers have cash," one broker said referring to a request in the proposal.
source - www.brecorder.com
Sri Lanka stx at 3-week high on earning hopes; margin easing rumour
* Index up on high turnover, volume on hopes of SEC rule change
* Foreign outflow at 407.6 million rupees
* Rupee firmer, ending nine straight sessions
COLOMBO, July 29 (Reuters) - Sri Lanka's bourse jumped 2.9 percent on Friday to a three-week high on high turnover andvolumes, sparked by hopes of good quarterly earnings and rumours the Securities and Exchange Commission (SEC) may roll back plans to end margin trading.
The SEC after market hours on Friday said it had not received any proposal from brokers to ease the margin phase-out and other regulations, as numerous brokers have anonymously said.
The main share index gained 2.9 percent or 191.81 points to 6,845.38, highest since July 8. It fell to a
seven-month low on Monday to the oversold region, making some stocks attractive. The 14-day Relative Strength Index shot up to 54.13 from Wednesday's 42.32, well above the oversold level of 30, Thomsonreuters data showed.
But foreign investors were net sellers of 407.6 million rupees worth of shares on Friday bring in the weeks outflow to 531.7 million rupees. They have sold 8.24 billion rupees in 2011 after a record outflow of 26.4 billion in 2010.
The bourse is up 0.28 percent for July but the index has shed 7.33 percent since June 1, mainly due to forced selling to meet the margin deadline. Analysts said they expect at least 10 percent quarter-on-quarter growth and 40 percent year-on-year in the overall June quarter earnings.
The day's turnover was 3.15 billion Sri Lanka rupees ($28.8 million), well above last year's average of 2.4 billion and this year's 2.7 billion. Friday's total volume was 102.6 million against the bourse'five-day average of 110.9 million. The 30-day and 90-day average trading volumes were 92.4 million and 106.4 million,
respectively. Last year's daily average was 67.9 million.
The bourse is up 3.16 percent so far this year, after being Asia's best performer in 2009 and 2010, with 124 percent and 96 percent respectively due to optimism over the economy after the end of a 25-year war in May 2009. The rupee ended firmer at 109.47/50 a dollar from Thursday's close of 109.49/50 on heavy dollar conversions including $500 million by the Central bank, which was exchanging proceeds from last week's $1 billion eurobond sale.
FACTORS TO WATCH:
- June quarter earnings of listed firms
- If foreign investors buy shares in large volumes.
- The extent of the rupee's appreciation.
source - www.reuters.com
* Foreign outflow at 407.6 million rupees
* Rupee firmer, ending nine straight sessions
COLOMBO, July 29 (Reuters) - Sri Lanka's bourse jumped 2.9 percent on Friday to a three-week high on high turnover andvolumes, sparked by hopes of good quarterly earnings and rumours the Securities and Exchange Commission (SEC) may roll back plans to end margin trading.
The SEC after market hours on Friday said it had not received any proposal from brokers to ease the margin phase-out and other regulations, as numerous brokers have anonymously said.
The main share index gained 2.9 percent or 191.81 points to 6,845.38, highest since July 8. It fell to a
seven-month low on Monday to the oversold region, making some stocks attractive. The 14-day Relative Strength Index shot up to 54.13 from Wednesday's 42.32, well above the oversold level of 30, Thomsonreuters data showed.
But foreign investors were net sellers of 407.6 million rupees worth of shares on Friday bring in the weeks outflow to 531.7 million rupees. They have sold 8.24 billion rupees in 2011 after a record outflow of 26.4 billion in 2010.
The bourse is up 0.28 percent for July but the index has shed 7.33 percent since June 1, mainly due to forced selling to meet the margin deadline. Analysts said they expect at least 10 percent quarter-on-quarter growth and 40 percent year-on-year in the overall June quarter earnings.
The day's turnover was 3.15 billion Sri Lanka rupees ($28.8 million), well above last year's average of 2.4 billion and this year's 2.7 billion. Friday's total volume was 102.6 million against the bourse'five-day average of 110.9 million. The 30-day and 90-day average trading volumes were 92.4 million and 106.4 million,
respectively. Last year's daily average was 67.9 million.
The bourse is up 3.16 percent so far this year, after being Asia's best performer in 2009 and 2010, with 124 percent and 96 percent respectively due to optimism over the economy after the end of a 25-year war in May 2009. The rupee ended firmer at 109.47/50 a dollar from Thursday's close of 109.49/50 on heavy dollar conversions including $500 million by the Central bank, which was exchanging proceeds from last week's $1 billion eurobond sale.
FACTORS TO WATCH:
- June quarter earnings of listed firms
- If foreign investors buy shares in large volumes.
- The extent of the rupee's appreciation.
source - www.reuters.com
Sri Lanka stocks up 2.88-pct
July 29, 2011 (LBO) - Sri Lankan stocks closed sharply higher Friday, as bullish momentum continued for the fourth straight day, with active retail participation, brokers said.
The benchmark All Share Price Index ended up 2.88 percent or 191.81 points at 6,845.38 , while the Milanka Index of more liquid stocks closed up 2.17 percent (131.94 points) at 6,210.07, according to stock exchange provisional figures.
Turnover was 3.1 billion rupees. There were 224 gainers and 28 losers.
Ceylon Guardian Investment Trust was the main contributor to the day’s turnover, closing at 357.60 rupees, up 48.10 rupees or 15.54 percent with 1.05 million shares worth 318 million rupees changing hands.
This included a one million share crossing or off-market negotiated deal at 300 rupees per share.
Ceylon Grain Elevators was the highest percentage gainer of the day and closed at 140.80 rupees up 35.60 rupees or 33.84 percent. More than 2.2 million shares were traded generating 298 million rupees.
source - www.lbo.lk
The benchmark All Share Price Index ended up 2.88 percent or 191.81 points at 6,845.38 , while the Milanka Index of more liquid stocks closed up 2.17 percent (131.94 points) at 6,210.07, according to stock exchange provisional figures.
Turnover was 3.1 billion rupees. There were 224 gainers and 28 losers.
Ceylon Guardian Investment Trust was the main contributor to the day’s turnover, closing at 357.60 rupees, up 48.10 rupees or 15.54 percent with 1.05 million shares worth 318 million rupees changing hands.
This included a one million share crossing or off-market negotiated deal at 300 rupees per share.
Ceylon Grain Elevators was the highest percentage gainer of the day and closed at 140.80 rupees up 35.60 rupees or 33.84 percent. More than 2.2 million shares were traded generating 298 million rupees.
source - www.lbo.lk
Bourse gathers strength; Market Cap up Rs. 53 b
The Colombo Bourse achieved a second day of positive growth boosting market capitalisation by Rs. 53 billion thanks to retail as well as select institutional buying.
Whilst recovery on Wednesday appeared fragile with ASI up by only near 1%, yesterday it gained by over 2%. Market capitalisation grew by Rs. 53 billion to Rs. 2,376 billion as opposed to 9 billion the previous day. During the six market days ending Tuesday, Bourse had lost Rs. 121 billion in value.
Whilst sentiments were better, activity levels were relatively low with a turnover of only Rs. 1.5 billion, down from Rs. 1.96 billion on Tuesday.
“Indices gained gradually to close in green today amidst interest witnessed in finance sector counters. Increased retail participation saw the indices gaining its lost ground. All the sector indices gained today,” NDB Stockbrokers said.
Banks, Finance & Insurance sector was the main contributor to the market turnover (due to Swarnamahal Financial Services), while the sector index increased by 2.34%. Swarnamahal Financial Services was the main contributor to the market turnover. The share price decreased by Rs. 13.10 (10.46%) and closed at Rs. 112.
Diversified sector also contributed significantly to the market turnover (due to Softlogic Holdings). The sector index decreased 1.88%. The share price of Softlogic Holdings increased by Rs. 1.20 (5.04%) and closed at Rs. 25.
Arrenga Capital said the recovery path that the bourse took during the initial hours of trading stabilised with significant buying interest emerging during the latter hours of trading.
The gains made in most high index counters such as Richard Pieris, Sampath Bank, DFCC Bank, John Keells Holdings and Commercial Bank assisted the ASPI to register the 148 point gain. The solid +100 points gain recorded was after a lapse of nearly two months when the market registered a gain of 103.8 points back in May 2011. Following the sharp dip in the market in the previous weeks, many investors were found picking on selected counters. With the positive trend seen in the past couple of days, the market sustained its technical estimation of support levels between 6,500- 6,400 point range.
Swarnamahal Financial Services saw around 1.1 mn shares being traded today with the share touching an intra-day high of LKR128.0 at open but closed at LKR112.0 for the day. Renewed investor participation was evident in Guardian Capital Partners, which led the counter top the day’s price gainers’ list with an appreciation of 23.05%. Retail and institutional participation was evident in Softlogic Holdings whilst foreign selling in National Development Bank was absorbed in by local institutions. Institutional play was visible in Commercial Bank and Aitken Spence.
Following the release of strong earnings by John Keells Holdings (up 35.3% YoY to LKR1.36 bn in 1QFY12) and Sampath Bank (up 52.21% YoY to LKR1.1 bn in 2QFY11) today, both the counters saw active investor involvement registering 1.34% and 4.74% price gains.
Furthermore, investor interest re-emerged in the poultry sector counters with Ceylon Grain Elevators, Three Acre Farms and Bairaha Farms Limited registering gains of 14.6%, 21.99% and 8.3% respectively.
sourcec - www.ft.lk
Whilst recovery on Wednesday appeared fragile with ASI up by only near 1%, yesterday it gained by over 2%. Market capitalisation grew by Rs. 53 billion to Rs. 2,376 billion as opposed to 9 billion the previous day. During the six market days ending Tuesday, Bourse had lost Rs. 121 billion in value.
Whilst sentiments were better, activity levels were relatively low with a turnover of only Rs. 1.5 billion, down from Rs. 1.96 billion on Tuesday.
“Indices gained gradually to close in green today amidst interest witnessed in finance sector counters. Increased retail participation saw the indices gaining its lost ground. All the sector indices gained today,” NDB Stockbrokers said.
Banks, Finance & Insurance sector was the main contributor to the market turnover (due to Swarnamahal Financial Services), while the sector index increased by 2.34%. Swarnamahal Financial Services was the main contributor to the market turnover. The share price decreased by Rs. 13.10 (10.46%) and closed at Rs. 112.
Diversified sector also contributed significantly to the market turnover (due to Softlogic Holdings). The sector index decreased 1.88%. The share price of Softlogic Holdings increased by Rs. 1.20 (5.04%) and closed at Rs. 25.
Arrenga Capital said the recovery path that the bourse took during the initial hours of trading stabilised with significant buying interest emerging during the latter hours of trading.
The gains made in most high index counters such as Richard Pieris, Sampath Bank, DFCC Bank, John Keells Holdings and Commercial Bank assisted the ASPI to register the 148 point gain. The solid +100 points gain recorded was after a lapse of nearly two months when the market registered a gain of 103.8 points back in May 2011. Following the sharp dip in the market in the previous weeks, many investors were found picking on selected counters. With the positive trend seen in the past couple of days, the market sustained its technical estimation of support levels between 6,500- 6,400 point range.
Swarnamahal Financial Services saw around 1.1 mn shares being traded today with the share touching an intra-day high of LKR128.0 at open but closed at LKR112.0 for the day. Renewed investor participation was evident in Guardian Capital Partners, which led the counter top the day’s price gainers’ list with an appreciation of 23.05%. Retail and institutional participation was evident in Softlogic Holdings whilst foreign selling in National Development Bank was absorbed in by local institutions. Institutional play was visible in Commercial Bank and Aitken Spence.
Following the release of strong earnings by John Keells Holdings (up 35.3% YoY to LKR1.36 bn in 1QFY12) and Sampath Bank (up 52.21% YoY to LKR1.1 bn in 2QFY11) today, both the counters saw active investor involvement registering 1.34% and 4.74% price gains.
Furthermore, investor interest re-emerged in the poultry sector counters with Ceylon Grain Elevators, Three Acre Farms and Bairaha Farms Limited registering gains of 14.6%, 21.99% and 8.3% respectively.
sourcec - www.ft.lk
Bourse rebounds anticipating regulatory relaxation
By Jithendra Antonio
The Colombo bourse closed for the third consecutive day, anticipating regulatory relaxation on the much debated broker-credit issue which has dragged the market down in the recent past with over-priced IPOs.
“This upward trend is not sustainable as it is based on mere wishful thinking. Overall market sentiment needs foreigners and foreign funds, but US debt crisis has created some negative sentiments for foreigners to invest in stock markets around the world.” Hijas Suhair, Assistant Manager, Corporate Advisory MBSL said.
“All these rallies might be short-term, and we will see the real performance if the SEC allows the brokers’ request,” another analyst from the Unit Trust Industry said.
According stockbrokerage officials, at a meeting held on Monday, almost all the Chief Executive Officers of stock broking firms agreed and signed letters stating that brokering firms should be able to lend their excess funds above the minimum capital requirement to their trade debtors.
According to Lanka Securities, Colombo Stock market rebounded sharply as benchmark ASI soared to year-to-date high.
ASI advanced by 147.27 index points (2.22%) to close at 6,652.83 while the more sensitive MPI closed at 6,078.13, up 134.22 index points (2.26%).
“The advancing shares far outnumbered the decliners. 229 shares rose while only 21 ones fell and 14 counters closed with no changes” the report noted.
Daily market turnover was Rs.1.5bn. Out of the total turnover, Rs.926.9 mn cash flowed into the market while Rs.569.7 mn cash flowed out. Market RSI based on All Share Index increased to 42.3 from the previous figure 29.3. Volatile price trend was seen in the speculative counter Swarnamahal Financial Services, and Lanka Securities also said corporate earnings for the Mar-June quarter boosted investor activity on premier counters.
“Poultry sector counters witnessed notable activity levels during the day and closed with considerable gains.
Ceylon Grain Elevators up Rs.16.20, Tree Acre Farms up Rs.22.50 and Bairaha Farms up Rs.24.80.
Further, Vallibel One, Nation Lanka Finance and Browns Investments were among the mostly traded counters,” the report noted.
Foreign participation was lower, however slightly improved to 7% from yesterday’s figure of 3%. Foreign investors ended as net sellers with a net foreign outflow of Rs.131.6 million.
source - www.dailymirror.lk
The Colombo bourse closed for the third consecutive day, anticipating regulatory relaxation on the much debated broker-credit issue which has dragged the market down in the recent past with over-priced IPOs.
“This upward trend is not sustainable as it is based on mere wishful thinking. Overall market sentiment needs foreigners and foreign funds, but US debt crisis has created some negative sentiments for foreigners to invest in stock markets around the world.” Hijas Suhair, Assistant Manager, Corporate Advisory MBSL said.
“All these rallies might be short-term, and we will see the real performance if the SEC allows the brokers’ request,” another analyst from the Unit Trust Industry said.
According stockbrokerage officials, at a meeting held on Monday, almost all the Chief Executive Officers of stock broking firms agreed and signed letters stating that brokering firms should be able to lend their excess funds above the minimum capital requirement to their trade debtors.
According to Lanka Securities, Colombo Stock market rebounded sharply as benchmark ASI soared to year-to-date high.
ASI advanced by 147.27 index points (2.22%) to close at 6,652.83 while the more sensitive MPI closed at 6,078.13, up 134.22 index points (2.26%).
“The advancing shares far outnumbered the decliners. 229 shares rose while only 21 ones fell and 14 counters closed with no changes” the report noted.
Daily market turnover was Rs.1.5bn. Out of the total turnover, Rs.926.9 mn cash flowed into the market while Rs.569.7 mn cash flowed out. Market RSI based on All Share Index increased to 42.3 from the previous figure 29.3. Volatile price trend was seen in the speculative counter Swarnamahal Financial Services, and Lanka Securities also said corporate earnings for the Mar-June quarter boosted investor activity on premier counters.
“Poultry sector counters witnessed notable activity levels during the day and closed with considerable gains.
Ceylon Grain Elevators up Rs.16.20, Tree Acre Farms up Rs.22.50 and Bairaha Farms up Rs.24.80.
Further, Vallibel One, Nation Lanka Finance and Browns Investments were among the mostly traded counters,” the report noted.
Foreign participation was lower, however slightly improved to 7% from yesterday’s figure of 3%. Foreign investors ended as net sellers with a net foreign outflow of Rs.131.6 million.
source - www.dailymirror.lk
Lankem buys 61.88% of Agarapatana for Rs.1.1 bn
Lankem Developments PLC (LDEV) in a filing to the stock exchange said the firm invested Rs.1.185 billion to purchase an equity stake of 61.88% in Agarapatana Plantations Ltd.
Back in March 2011, LDEV said it had decided to come up with the rights issue, in a bid to raise Rs.2.5 billion for an investment in acquisition of 61.88% of Agarapatana Plantations Ltd and for further investments in plantations, leisure industry and hydro power plants. Subsequently, in a stock exchange filing, Lankem Developments said it will issue 15 rights per share at a price of Rs.25 each to acquire 47,417,276 (61.88% stake) ordinary shares of Agarapatana Plantations Ltd at a total cost of Rs.1.185 billion.
In another filing to the stock exchange, Kotagala Plantations (KOTA) said it expects to earn Rs.150 million, disposing 6 million shares of Agarapatana Plantations to Lankem Developments.
Lankem Ceylon PLC (LCEY) in a statement to CSE later said, its earlier subsidiary Lankem Developments PLC (LDEV) has become an indirect subsidiary of the company as the rights issue had only been able to raise nearly half of the anticipated Rs.2.5 billion.
Accordingly, Lankem Plantations Holdings became the company’s immediate parent followed by the recently concluded rights issue. Accordingly, Lankem Plantations Holdings now holds 56.25% of LDEV whilst Lankem Ceylon (LCEY) earlier held a little over 50% of LDEV, prior to rights issue.
Mirror Business earlier reported that though Lankem Ceylon PLC (LCEY) subsidiary Lankem Developments (LDEV) was to raise Rs.2.5 billion via rights, it has only managed Rs.1.32 billion as at June 7, as per a stock exchange statement by the company.
source - www.dailymirror.lk
Back in March 2011, LDEV said it had decided to come up with the rights issue, in a bid to raise Rs.2.5 billion for an investment in acquisition of 61.88% of Agarapatana Plantations Ltd and for further investments in plantations, leisure industry and hydro power plants. Subsequently, in a stock exchange filing, Lankem Developments said it will issue 15 rights per share at a price of Rs.25 each to acquire 47,417,276 (61.88% stake) ordinary shares of Agarapatana Plantations Ltd at a total cost of Rs.1.185 billion.
In another filing to the stock exchange, Kotagala Plantations (KOTA) said it expects to earn Rs.150 million, disposing 6 million shares of Agarapatana Plantations to Lankem Developments.
Lankem Ceylon PLC (LCEY) in a statement to CSE later said, its earlier subsidiary Lankem Developments PLC (LDEV) has become an indirect subsidiary of the company as the rights issue had only been able to raise nearly half of the anticipated Rs.2.5 billion.
Accordingly, Lankem Plantations Holdings became the company’s immediate parent followed by the recently concluded rights issue. Accordingly, Lankem Plantations Holdings now holds 56.25% of LDEV whilst Lankem Ceylon (LCEY) earlier held a little over 50% of LDEV, prior to rights issue.
Mirror Business earlier reported that though Lankem Ceylon PLC (LCEY) subsidiary Lankem Developments (LDEV) was to raise Rs.2.5 billion via rights, it has only managed Rs.1.32 billion as at June 7, as per a stock exchange statement by the company.
source - www.dailymirror.lk
Seylan profits hit by VRS
The Rs.700 million Voluntary Retirement Scheme (VRS) dragged down the profitability of Seylan Bank, as the former Ceylinco group bank recorded a net loss of Rs.304 million in the second quarter 2011 against a net profit of Rs.312 million in the same quarter of the previous year.
However, according to the financials presented to the Colombo Stock Exchange, even excluding the VRS cost, the bank’s pre-tax profit was down 44 percent year-on-year to Rs.383 million.
The bank recorded a loss per share of Rs.4.79 against last year’s earnings per share of Rs.4.92. The interest income of Seylan grew 8.4 percent to Rs.2.97 billion and interest expenses fell at a faster rate of 9.3 percent to Rs.1.97 billion. Group performing loans and advances rose 8.9 percent to Rs.76.3 by end June from December 2010.
However, a 324 percent increase or Rs.100 million increase in provisions for decline in value of investment can be seen in the financial accounts.
In the meantime, another sharp increase of 205% or Rs.272 million increase has been accounted for impairment loss.
Seylan had raised Rs.4.6 billion from a rights issue in June.
source - www.dailymirror.lk
However, according to the financials presented to the Colombo Stock Exchange, even excluding the VRS cost, the bank’s pre-tax profit was down 44 percent year-on-year to Rs.383 million.
The bank recorded a loss per share of Rs.4.79 against last year’s earnings per share of Rs.4.92. The interest income of Seylan grew 8.4 percent to Rs.2.97 billion and interest expenses fell at a faster rate of 9.3 percent to Rs.1.97 billion. Group performing loans and advances rose 8.9 percent to Rs.76.3 by end June from December 2010.
However, a 324 percent increase or Rs.100 million increase in provisions for decline in value of investment can be seen in the financial accounts.
In the meantime, another sharp increase of 205% or Rs.272 million increase has been accounted for impairment loss.
Seylan had raised Rs.4.6 billion from a rights issue in June.
source - www.dailymirror.lk
Pan Asia first half net up 169%
Pan Asia Bank announced the completion of a very successful first half in 2011, with Net Profit after Tax increasing to Rs 406 Mn which is 169 % better than the corresponding period for 2010.
Bank’s Net Interest Income for the period rose by 43% to Rs 1,024 Mn from Rs 716 Mn in 2010 which came mainly from the core banking income. The commission income grew by 64% compared to previous year in the same period mainly due to the increased volume of trade, guarantees and other international business handled by the bank. The customer loans almost doubled with a growth of 97% to Rs 29,175 Mn.
The major contributors for the higher asset growth came from Gold Loans/Pawning, Leasing, Ranaviru Harasara Loans and Overdrafts. During the same period, the bank’s deposits grew by an impressive 72% to Rs 30,792 Mn. Key indicators such as the NPA ratio declined to 4.52% from 5.36 % as at year end 2010, and notably the Net NPA ratio is down to 2.59% from 2.74% which is well within industry average and reflects sound asset quality. In addition to the impressive performance in terms of profit growth and prudent risk management, Pan Asia Bank also embarked on an aggressive expansion drive under which 10 new branches were added as of June 30, 2011 taking the branch network to a total of 51 branches.
source - www.dailymirror.lk
Bank’s Net Interest Income for the period rose by 43% to Rs 1,024 Mn from Rs 716 Mn in 2010 which came mainly from the core banking income. The commission income grew by 64% compared to previous year in the same period mainly due to the increased volume of trade, guarantees and other international business handled by the bank. The customer loans almost doubled with a growth of 97% to Rs 29,175 Mn.
The major contributors for the higher asset growth came from Gold Loans/Pawning, Leasing, Ranaviru Harasara Loans and Overdrafts. During the same period, the bank’s deposits grew by an impressive 72% to Rs 30,792 Mn. Key indicators such as the NPA ratio declined to 4.52% from 5.36 % as at year end 2010, and notably the Net NPA ratio is down to 2.59% from 2.74% which is well within industry average and reflects sound asset quality. In addition to the impressive performance in terms of profit growth and prudent risk management, Pan Asia Bank also embarked on an aggressive expansion drive under which 10 new branches were added as of June 30, 2011 taking the branch network to a total of 51 branches.
source - www.dailymirror.lk
JKH net profits up 35 percent
Jhon Keells Holdings net profit for the second quarter increased 35 percent to Rs. 1.37 billion from Rs. 1.01 billion a year ago.
Group profit before tax (PBT) of Rs. 1.88 billion for the quarter is an increase of 23 per cent over the PBT of Rs. 1.53 billion in the corresponding period in the previous year.
The revenue at Rs. 15.69 billion in the first quarter was 21 per cent above the Rs. 12.92 billion recorded in the corresponding period in the previous year. The Company PBT of Rs. 1.02 billion for the quarter was marginally above the Rs. 1.01 billion recorded in the corresponding period in the previous year.
Transportation PBT of Rs. 742 million was a decrease of 7 per cent over the first three months of 2010/11 Q1: Rs. 802 million], mainly due to the translation impact arising from a stronger Sri Lankan Rupee.
The Leisure industry group recorded a significant improvement in the first quarter with a PBT of Rs. 374 million [2010/11 Q1: loss of Rs. 14 million]. The City Hotels – Cinnamon Grand Colombo and Cinnamon Lakeside Colombo saw strong growth and the Maldivian resort hotel sector also saw an improved performance compared to the loss it had made in the first quarter of last year.
Property recorded a PBT of Rs. 85 million for the quarter, a decrease of 41 per cent over the corresponding period last year [2010/11 Q1: Rs. 145 million]. The cyclical nature of the revenue recognition of the property group’s projects is the main reason for the variance from the corresponding period in the previous year. The Emperor project is scheduled for completion in September this year. The construction of the Rs. 7.8 billion apartment block, "OnThree20", commenced in April this year, with over 65 per cent of the apartments sold off plan
Consumer Foods and Retail PBT of Rs. 207 million for the quarter was an increase of 22 per cent over the first quarter last year [2010/11 Q1: Rs. 169 million], primarily due to volume increases in the ice creams and soft drinks businesses.
Financial Services PBT of Rs. 422 million for the quarter is a 12 per cent increase over the same period last year [2010/11 Q1: Rs. 377 million], mainly as a result of a significantly better performance by the banking associate Nations Trust Bank. The insurance business, Union Assurance is also seeing strong growth, with life business premiums growing by 34 percent in Q1. The investment banking arm, John Keells Capital, accounted under ‘other’, executed a number of mandates during the quarter.
The Information Technology Group recorded a loss of Rs. 20 million for the three months, compared to the performance over the same period last year [2010/11 Q1: Rs. 0.8 million] due to costs associated with the transition of the BPO business to a new facility.
Other comprising of Plantation Services, John Keells Capital and the Corporate Centre recorded a PBT of Rs. 74 million for the three month period, an increase of 43 percent when compared to the corresponding period last year [2010/11 Q4: Rs. 52 million].
source - www.island.lk
Group profit before tax (PBT) of Rs. 1.88 billion for the quarter is an increase of 23 per cent over the PBT of Rs. 1.53 billion in the corresponding period in the previous year.
The revenue at Rs. 15.69 billion in the first quarter was 21 per cent above the Rs. 12.92 billion recorded in the corresponding period in the previous year. The Company PBT of Rs. 1.02 billion for the quarter was marginally above the Rs. 1.01 billion recorded in the corresponding period in the previous year.
Transportation PBT of Rs. 742 million was a decrease of 7 per cent over the first three months of 2010/11 Q1: Rs. 802 million], mainly due to the translation impact arising from a stronger Sri Lankan Rupee.
The Leisure industry group recorded a significant improvement in the first quarter with a PBT of Rs. 374 million [2010/11 Q1: loss of Rs. 14 million]. The City Hotels – Cinnamon Grand Colombo and Cinnamon Lakeside Colombo saw strong growth and the Maldivian resort hotel sector also saw an improved performance compared to the loss it had made in the first quarter of last year.
Property recorded a PBT of Rs. 85 million for the quarter, a decrease of 41 per cent over the corresponding period last year [2010/11 Q1: Rs. 145 million]. The cyclical nature of the revenue recognition of the property group’s projects is the main reason for the variance from the corresponding period in the previous year. The Emperor project is scheduled for completion in September this year. The construction of the Rs. 7.8 billion apartment block, "OnThree20", commenced in April this year, with over 65 per cent of the apartments sold off plan
Consumer Foods and Retail PBT of Rs. 207 million for the quarter was an increase of 22 per cent over the first quarter last year [2010/11 Q1: Rs. 169 million], primarily due to volume increases in the ice creams and soft drinks businesses.
Financial Services PBT of Rs. 422 million for the quarter is a 12 per cent increase over the same period last year [2010/11 Q1: Rs. 377 million], mainly as a result of a significantly better performance by the banking associate Nations Trust Bank. The insurance business, Union Assurance is also seeing strong growth, with life business premiums growing by 34 percent in Q1. The investment banking arm, John Keells Capital, accounted under ‘other’, executed a number of mandates during the quarter.
The Information Technology Group recorded a loss of Rs. 20 million for the three months, compared to the performance over the same period last year [2010/11 Q1: Rs. 0.8 million] due to costs associated with the transition of the BPO business to a new facility.
Other comprising of Plantation Services, John Keells Capital and the Corporate Centre recorded a PBT of Rs. 74 million for the three month period, an increase of 43 percent when compared to the corresponding period last year [2010/11 Q4: Rs. 52 million].
source - www.island.lk
Sampath Group profits up 56 percent
Sampath Bank Group which comprises of Sampath Bank and four subsidiary companies, continued its growth momentum in the 1st half of 201l, by posting impressive results in all key areas over the last year same period.
Pre-Tax Profit of Rs. 2,977 Mn of the Group for the 1 H 201l was a growth of Rs. 1,092 Mn or 57.9 percent, over the previous year’s pre-tax profit of Rs. 1,885 Mn, with Sampath Bank contributing bulk (94.24 percent) of the profit, as the main entity of the Group. The post - tax profit of the Group for the 1H 2011which amounted to Rs. 2,131 Mn, recorded a growth of Rs. 765 Mn or 56 percent, over the post-tax profit of Rs. 1,366 Mn for the same period 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.
The Bank’s pre-tax profit of Rs. 2,805 Mn in the 1H 201l, reflected an increase of Rs. 1,033 Mn or 58.3 percent over the pre-tax profit of Rs.1,772 Mn for the 1H 2010. The post –tax profit of the Bank recorded a growth of 52.7 percent over the same period of last year, rising from Rs. 1,302 Mn in 2010 to Rs.1, 988 Mn in 2011.
source - www.island.lk
Pre-Tax Profit of Rs. 2,977 Mn of the Group for the 1 H 201l was a growth of Rs. 1,092 Mn or 57.9 percent, over the previous year’s pre-tax profit of Rs. 1,885 Mn, with Sampath Bank contributing bulk (94.24 percent) of the profit, as the main entity of the Group. The post - tax profit of the Group for the 1H 2011which amounted to Rs. 2,131 Mn, recorded a growth of Rs. 765 Mn or 56 percent, over the post-tax profit of Rs. 1,366 Mn for the same period 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.
The Bank’s pre-tax profit of Rs. 2,805 Mn in the 1H 201l, reflected an increase of Rs. 1,033 Mn or 58.3 percent over the pre-tax profit of Rs.1,772 Mn for the 1H 2010. The post –tax profit of the Bank recorded a growth of 52.7 percent over the same period of last year, rising from Rs. 1,302 Mn in 2010 to Rs.1, 988 Mn in 2011.
source - www.island.lk
Thursday, July 28, 2011
Sri Lanka stocks up 2.28 percent
July 28, 2011 (LBO) - Sri Lankan stocks closed up for the third straight day, boosted by better banking sector earnings and expectations of relaxed broker credit rules despite profit taking on recently listed finance companies, brokers said.
The benchmark All Share Price Index ended up 2.28 percent or 148.01 points at 6,653.57, while the Milanka Index of more liquid stocks closed up 2.26 percent (134.22 points) at 6,078.13, according to stock exchange provisional figures.
Turnover was 1.49 billion rupees.
John Keells Holdings, which reported 35 percent quarterly growth in profits closed up 1.34 percent at 189 rupees and Samapath Bank, which reported 52 percent growth in earnings closed up 4.74 percent at 240.90 rupees.
Seylan Bank which reported a 303 million loss for the quarter due to a one-off voluntary retirement charge closed at 62.90 rupees, up 30 cents.
Lankem Developments said it had bought a 61.88 stake in Agarapatana Plantations for 1185 million rupees.
Swarnamahal Financial was the main contributor to the day’s turnover, closing at 112.00 rupees down 13.10 rupees or 10.46 percent amid profit taking. Around 1.1 million shares worth 13.9 million rupees changed hands.
Watapota closed at 198.40 rupees up 36.50 rupees or 23 percent. More than 552,700 million Watapota One shares were traded for 102.8 million rupees.
source - www.lbo.lk
The benchmark All Share Price Index ended up 2.28 percent or 148.01 points at 6,653.57, while the Milanka Index of more liquid stocks closed up 2.26 percent (134.22 points) at 6,078.13, according to stock exchange provisional figures.
Turnover was 1.49 billion rupees.
John Keells Holdings, which reported 35 percent quarterly growth in profits closed up 1.34 percent at 189 rupees and Samapath Bank, which reported 52 percent growth in earnings closed up 4.74 percent at 240.90 rupees.
Seylan Bank which reported a 303 million loss for the quarter due to a one-off voluntary retirement charge closed at 62.90 rupees, up 30 cents.
Lankem Developments said it had bought a 61.88 stake in Agarapatana Plantations for 1185 million rupees.
Swarnamahal Financial was the main contributor to the day’s turnover, closing at 112.00 rupees down 13.10 rupees or 10.46 percent amid profit taking. Around 1.1 million shares worth 13.9 million rupees changed hands.
Watapota closed at 198.40 rupees up 36.50 rupees or 23 percent. More than 552,700 million Watapota One shares were traded for 102.8 million rupees.
source - www.lbo.lk
Browns Investments stabilises
This week’s debutant Browns Investments Ltd., stabilised yesterday with only 6.45 million shares traded before closing 10 cents up to Rs. 4.90. It hit an intra-day high of Rs. 5.10.
On its debut BIL saw 75 million shares traded before closing at Rs. 4.80, which was 20 cents below IPO price.
Perhaps defending the stock or seeing greater value BIL promoters or connected parties were the biggest buyers on debut. Daily FT learns Taprobane Holdings and Brown and Company bought 20 million shares each and LOLC bought 10 million shares. Among sellers were Associated Electricals, Nimal Perera and Confifi Capital.
source - www.ft.lk
On its debut BIL saw 75 million shares traded before closing at Rs. 4.80, which was 20 cents below IPO price.
Perhaps defending the stock or seeing greater value BIL promoters or connected parties were the biggest buyers on debut. Daily FT learns Taprobane Holdings and Brown and Company bought 20 million shares each and LOLC bought 10 million shares. Among sellers were Associated Electricals, Nimal Perera and Confifi Capital.
source - www.ft.lk
JKH in solid start for FY2012
First Quarter net profit up 35% to Rs. 1.37 b; Group pre-tax profit up 23% to Rs. 1.88 b
Premier blue chip John Keells Holdings (JKH) has begun the 2012 financial year on a solid note with its bottom line up 35% to Rs. 1.37 billion and Group pre-tax profit up 23% to Rs. 1.88 billion over the corresponding period of last year.
Group revenue at Rs. 15.69 billion in the first quarter ended on 31 June, 2011 was 21% above the Rs. 12.92 billion recorded in the corresponding period of FY2011.
The first quarter is generally a subdued period for most diversified blue chips hence analysts termed the results as impressive. Unaudited accounts were released after the market was closed and when it opens today market will get an opportunity to assess how investors react to JKH earnings. Yesterday the stock price gained by 80 cents to Rs. 186.50.
At Company level JKH’s Profit Before Tax (PBT) of Rs. 1.02 billion for the quarter was marginally above the Rs. 1.01 billion recorded in the corresponding period in the previous year.
Transportation PBT of Rs. 742 million was a decrease of 7% over the first three months of 2010/11 [2010/11 Q1: Rs. 802 million], mainly due to the impact arising from a stronger Sri Lankan rupee.
JKH Chairman Susantha Ratnayake in a review accompanying interim results said SAGT has ordered two new super post panamax cranes (to be delivered in the fourth quarter) which will further enhance its capability to handle the larger modern vessels, which in turn will increase productivity and therefore capacity.
The Airline and Bunkering business units performed well above the corresponding period in the
previous year, with the bunkering business seeing higher volumes and margins compared to the corresponding quarter in the previous year.
John Keells Logistics and USAID, in partnership, have jointly committed an investment of more than Rs.400 million to implement a cold chain for agricultural and fisheries products in the North and East of Sri Lanka.
The Leisure industry group recorded a significant improvement in the first quarter with a PBT of Rs. 374 million [2010/11 Q1: loss of Rs. 14 million]. The City Hotels – Cinnamon Grand Colombo and Cinnamon Lakeside Colombo saw strong growth and the Maldivian resort hotel sector also saw an improved performance compared to the loss it had made in the first quarter of last year.
The rebranding and repositioning of Cinnamon Lakeside, in September 2009, has resulted in the hotel winning the Presidential Award for the best 5 star hotel in the city. The Cinnamon Grand has been inducted into the Presidential “Hall of Fame” following three consecutive awards for the best 5 star city hotel. The Cinnamon properties in the city continue to command premium room rates and above average market occupancies. Chaaya Tranz and Chaaya Bey are ahead of schedule and on budget and are expected to be operational in November 2011 and June 2012 respectively, adding 357 rooms to JKH resort hotel inventory. The refurbishment and expansion of Chaaya Wild (formerly the Yala Village Hotel) is underway and the hotel will re-open in November 2011.
“The total investment, both incurred and committed, in Leisure since the end of the conflict in May 2009 has been approximately Rs. 7 billion and, given the buoyancy of the Leisure Industry, in Sri Lanka, we are confident that these investments will provide the necessary returns,” JKH Chief said.
Property recorded a PBT of Rs. 85 million for the quarter, a decrease of 41%over the corresponding period last year [2010/11 Q1: Rs. 145 million]. The cyclical nature of the revenue recognition of the property group’s projects is the main reason for the variance from the corresponding period in the previous year. The Emperor project is scheduled for completion in September this year. The construction of the Rs. 7.8 billion apartment block, “OnThree20”, commenced in April this year, with over 65%of the apartments sold off plan.
The recent sale of property in the city to Shangri-la and CATIC of China have set a new benchmark for property prices in Colombo and this has resulted in a significant enhancement of the value of our land bank in the city. During the quarter, we acquired a block of 6.5 acres in a prime suburb of Colombo. Plans for a large scale development on one of our city properties are also well advanced.
Consumer Foods and Retail PBT of Rs. 207 million for the quarter was an increase of 22% over the first quarter last year [2010/11 Q1: Rs. 169 million], primarily due to volume increases in the ice creams and soft drinks businesses.
“Since the rebranding of Elephant House, our entry into the cola segment and the commissioning of the ‘on premise’ ice cream production facility, we continue to be market leaders in both categories with increased market shares. The retail business saw improved margins with higher basket values and customer numbers. We have, in the calendar year 2011, added in excess of 60,000 square feet of retail space to our portfolio and locations have been identified for more large format stores and malls,” Ratnayake said.
Financial Services PBT of Rs. 422 million for the quarter is a 12%increase over the same period last year [2010/11 Q1: Rs. 377 million], mainly as a result of a significantly better performance by the banking associate Nations Trust Bank. The insurance business, Union Assurance is also seeing strong growth, with life business premiums growing by 34 percent in Q1. The investment banking arm, John Keells Capital, accounted under ‘other’, executed a number of mandates during the quarter.
The Information Technology Group recorded a loss of Rs. 20 million for the three months, compared to the performance over the same period last year [2010/11 Q1: Rs. 0.8 million] due to costs associated with the transition of the BPO business to a new facility. The Office Automation business continues to see growth and the BPO business has acquired a number of new high profile customers and plans are in place to lease a second facility in Gurgaon. The business is well positioned to achieve steady growth during the remainder of the year.
Other comprising of Plantation Services, John Keells Capital and the Corporate Centre recorded a PBT of Rs. 74 million for the three month period, an increase of 43 percent when compared to the corresponding period last year [2010/11 Q4: Rs. 52 million].
A biodiversity conference was organised by the John Keells Foundation (JKF) in collaboration with the International Union for the Conservation of Nature (IUCN) and the Ceylon Chamber of Commerce, on the sustainable use of biodiversity for economic development. The goal of the conference was to increase awareness and understanding on the importance of biodiversity and its preservation, which is a vital tool for sustainable economic development and poverty alleviation in Sri Lanka.
English Day 2011, which showcases the skills and talents of the John Keells English Language Scholarship winners from across the island, was successfully held in Colombo during the quarter with the participation of approximately 500 children. The event was organised by JKH in collaboration with the Gateway Language Centre.
Mangalagama – the border village in Ampara which is being developed by JKF under the village adoption project saw the successful completion of the tank rehabilitation project and the first phase of the school development project covering the refurbishment of a derelict school building, the renovation of the present teachers’ quarters and purchase of the pre-school playground equipment. The second phase of the school project comprising the construction of teacher dormitories is also underway.
As part of its vision project, JKF donated 477 spectacles and sponsored 289 cataract surgeries during the quarter. 197 of the cataract surgeries were conducted in Kilinochchi under the patronage of the Ministry of Health. The John Keells HIV and AIDS awareness campaign educated 1,193 persons including members of the armed forces, during the quarter.
source - www.ft.lk
Premier blue chip John Keells Holdings (JKH) has begun the 2012 financial year on a solid note with its bottom line up 35% to Rs. 1.37 billion and Group pre-tax profit up 23% to Rs. 1.88 billion over the corresponding period of last year.
Group revenue at Rs. 15.69 billion in the first quarter ended on 31 June, 2011 was 21% above the Rs. 12.92 billion recorded in the corresponding period of FY2011.
The first quarter is generally a subdued period for most diversified blue chips hence analysts termed the results as impressive. Unaudited accounts were released after the market was closed and when it opens today market will get an opportunity to assess how investors react to JKH earnings. Yesterday the stock price gained by 80 cents to Rs. 186.50.
At Company level JKH’s Profit Before Tax (PBT) of Rs. 1.02 billion for the quarter was marginally above the Rs. 1.01 billion recorded in the corresponding period in the previous year.
Transportation PBT of Rs. 742 million was a decrease of 7% over the first three months of 2010/11 [2010/11 Q1: Rs. 802 million], mainly due to the impact arising from a stronger Sri Lankan rupee.
JKH Chairman Susantha Ratnayake in a review accompanying interim results said SAGT has ordered two new super post panamax cranes (to be delivered in the fourth quarter) which will further enhance its capability to handle the larger modern vessels, which in turn will increase productivity and therefore capacity.
The Airline and Bunkering business units performed well above the corresponding period in the
previous year, with the bunkering business seeing higher volumes and margins compared to the corresponding quarter in the previous year.
John Keells Logistics and USAID, in partnership, have jointly committed an investment of more than Rs.400 million to implement a cold chain for agricultural and fisheries products in the North and East of Sri Lanka.
The Leisure industry group recorded a significant improvement in the first quarter with a PBT of Rs. 374 million [2010/11 Q1: loss of Rs. 14 million]. The City Hotels – Cinnamon Grand Colombo and Cinnamon Lakeside Colombo saw strong growth and the Maldivian resort hotel sector also saw an improved performance compared to the loss it had made in the first quarter of last year.
The rebranding and repositioning of Cinnamon Lakeside, in September 2009, has resulted in the hotel winning the Presidential Award for the best 5 star hotel in the city. The Cinnamon Grand has been inducted into the Presidential “Hall of Fame” following three consecutive awards for the best 5 star city hotel. The Cinnamon properties in the city continue to command premium room rates and above average market occupancies. Chaaya Tranz and Chaaya Bey are ahead of schedule and on budget and are expected to be operational in November 2011 and June 2012 respectively, adding 357 rooms to JKH resort hotel inventory. The refurbishment and expansion of Chaaya Wild (formerly the Yala Village Hotel) is underway and the hotel will re-open in November 2011.
“The total investment, both incurred and committed, in Leisure since the end of the conflict in May 2009 has been approximately Rs. 7 billion and, given the buoyancy of the Leisure Industry, in Sri Lanka, we are confident that these investments will provide the necessary returns,” JKH Chief said.
Property recorded a PBT of Rs. 85 million for the quarter, a decrease of 41%over the corresponding period last year [2010/11 Q1: Rs. 145 million]. The cyclical nature of the revenue recognition of the property group’s projects is the main reason for the variance from the corresponding period in the previous year. The Emperor project is scheduled for completion in September this year. The construction of the Rs. 7.8 billion apartment block, “OnThree20”, commenced in April this year, with over 65%of the apartments sold off plan.
The recent sale of property in the city to Shangri-la and CATIC of China have set a new benchmark for property prices in Colombo and this has resulted in a significant enhancement of the value of our land bank in the city. During the quarter, we acquired a block of 6.5 acres in a prime suburb of Colombo. Plans for a large scale development on one of our city properties are also well advanced.
Consumer Foods and Retail PBT of Rs. 207 million for the quarter was an increase of 22% over the first quarter last year [2010/11 Q1: Rs. 169 million], primarily due to volume increases in the ice creams and soft drinks businesses.
“Since the rebranding of Elephant House, our entry into the cola segment and the commissioning of the ‘on premise’ ice cream production facility, we continue to be market leaders in both categories with increased market shares. The retail business saw improved margins with higher basket values and customer numbers. We have, in the calendar year 2011, added in excess of 60,000 square feet of retail space to our portfolio and locations have been identified for more large format stores and malls,” Ratnayake said.
Financial Services PBT of Rs. 422 million for the quarter is a 12%increase over the same period last year [2010/11 Q1: Rs. 377 million], mainly as a result of a significantly better performance by the banking associate Nations Trust Bank. The insurance business, Union Assurance is also seeing strong growth, with life business premiums growing by 34 percent in Q1. The investment banking arm, John Keells Capital, accounted under ‘other’, executed a number of mandates during the quarter.
The Information Technology Group recorded a loss of Rs. 20 million for the three months, compared to the performance over the same period last year [2010/11 Q1: Rs. 0.8 million] due to costs associated with the transition of the BPO business to a new facility. The Office Automation business continues to see growth and the BPO business has acquired a number of new high profile customers and plans are in place to lease a second facility in Gurgaon. The business is well positioned to achieve steady growth during the remainder of the year.
Other comprising of Plantation Services, John Keells Capital and the Corporate Centre recorded a PBT of Rs. 74 million for the three month period, an increase of 43 percent when compared to the corresponding period last year [2010/11 Q4: Rs. 52 million].
A biodiversity conference was organised by the John Keells Foundation (JKF) in collaboration with the International Union for the Conservation of Nature (IUCN) and the Ceylon Chamber of Commerce, on the sustainable use of biodiversity for economic development. The goal of the conference was to increase awareness and understanding on the importance of biodiversity and its preservation, which is a vital tool for sustainable economic development and poverty alleviation in Sri Lanka.
English Day 2011, which showcases the skills and talents of the John Keells English Language Scholarship winners from across the island, was successfully held in Colombo during the quarter with the participation of approximately 500 children. The event was organised by JKH in collaboration with the Gateway Language Centre.
Mangalagama – the border village in Ampara which is being developed by JKF under the village adoption project saw the successful completion of the tank rehabilitation project and the first phase of the school development project covering the refurbishment of a derelict school building, the renovation of the present teachers’ quarters and purchase of the pre-school playground equipment. The second phase of the school project comprising the construction of teacher dormitories is also underway.
As part of its vision project, JKF donated 477 spectacles and sponsored 289 cataract surgeries during the quarter. 197 of the cataract surgeries were conducted in Kilinochchi under the patronage of the Ministry of Health. The John Keells HIV and AIDS awareness campaign educated 1,193 persons including members of the armed forces, during the quarter.
source - www.ft.lk
EPF buys 3.5% Browns stake for Rs. 737m
PC House owner Rishan exits
In a welcome return of pension fund giant, the EPF yesterday bought a 3.5% stake in Brown and Company for Rs. 737 million.
Browns saw 2.568 million of its shares change hands via 62 trades for Rs. 745 million. Of that there were 7 crossings involving 2.54 million shares at Rs. 290 each. It closed at Rs. 285.30, down by Rs. 5.70.
The seller was PC House Chairman S.H.M. Rishan.
Last week Browns closed at Rs. 286.10 down by Rs. 14.90 from Rs. 301 a week earlier. Its 52-week highest was Rs. 404.90. Net asset per share is Rs. 135.68 and Rs. 203.65 at Group level.
For the buyer, EPF it was the first stake at Browns which is controlled by companies owned and/or connected to Ajit Devasurendra, Ishara Nanayakkara and Shankar Somasundaram.
In 2010/11 financial year, Browns posted a Rs. 3.6 billion after tax profit up by 184% over the previous year. Net profit attributable to equity holders was Rs. 2.06 billion, up from Rs. 1.0 billion in FY2010.
source - www.ft.lk
In a welcome return of pension fund giant, the EPF yesterday bought a 3.5% stake in Brown and Company for Rs. 737 million.
Browns saw 2.568 million of its shares change hands via 62 trades for Rs. 745 million. Of that there were 7 crossings involving 2.54 million shares at Rs. 290 each. It closed at Rs. 285.30, down by Rs. 5.70.
The seller was PC House Chairman S.H.M. Rishan.
Last week Browns closed at Rs. 286.10 down by Rs. 14.90 from Rs. 301 a week earlier. Its 52-week highest was Rs. 404.90. Net asset per share is Rs. 135.68 and Rs. 203.65 at Group level.
For the buyer, EPF it was the first stake at Browns which is controlled by companies owned and/or connected to Ajit Devasurendra, Ishara Nanayakkara and Shankar Somasundaram.
In 2010/11 financial year, Browns posted a Rs. 3.6 billion after tax profit up by 184% over the previous year. Net profit attributable to equity holders was Rs. 2.06 billion, up from Rs. 1.0 billion in FY2010.
source - www.ft.lk
PCH introduces latest Karbonn mobile phone range
Riding on a wave of success, the latest range of Karbonn mobile phones were introduced by PCH. The three new models- K111, K550i and the K515 are dual SIM phones and come with the latest upgrades of the Karbonn mobile range.
Affordably priced, these three phones are equipped with an array of stylish and attractive features. The phones have high quality sound for music lovers with hi-fi audio output for both FM as well as MP3 playback and crystal clear loudspeaker features. The phones support MP3 and MIDI formats of music.
The K550i, priced at Rs. 7,850 has a large screen and has a radio that operates without the need of connecting a headset, and also has the room for two memory cards, and has an inbuilt browser in and applications for Facebook, MSN, Yahoo messenger and offers amazing sound quality. The K111 comes with dual sim features along with digital camera, expandable memory and outstanding loudspeakers while the K515 sports amazing connectivity along with Nimbuzz, Snaptu, and Opera while also having an impressive battery life both phones are priced at Rs. 5,300 and Rs. 6,950 respectively.
Failan Saleem, COO, Mobile Handset division of PCH says, “The new Karbonn phones are stylish and affordable and are powered by hi-fi sound output for a high quality audio experience. This is a must-have for any music lover and the new generation of hand phone users.”
Over the years, dual SIM phones have become a preferred option especially in the rural market. Reiterating that dual SIMs is the new frontier for mobile telephony as it offers better connectivity at an affordable price, Saleem is confident that the Karbonn phones would be the best option for such users. “Apart from the benefit of having different numbers for different purposes, especially where a local SIM can take care of outgoing calls and the roaming capability of the other SIM could be used for receiving calls, the phones are backed by a proper warranty,” he added.
The new range of mobile phones will be available through PC Houses extensive customer dealership network to all customers across the island. The latest models offered will be ideally suited for the Sri Lankan market and will target everyday Sri Lankan consumers offering them basic and high end features that other mobile handsets do not offer at affordable prices.
S. H. M. Rishan, Chairman of PCH commenting on the launch of their new Karbonn mobiles stated, “In Karbonn mobiles we see a new opportunity to offer quality mobile handsets that are tailored to a Sri Lankan market. We especially want to offer affordable reliable mobile phones in the North and East of the country , as we have observed a great deal of development in the communication industry in this area. In doing so we seek to further ascertain the brand name of Karbonn in Sri Lanka and make it synonymous with PC House and the quality that has come to be expected from us. ”
Karbonn Mobiles is a new generation of mobile phones that redefine life in every way. Loaded with features, high quality, superior technology, service and more, it creates a perfect harmony between style and function.
PCH is the new corporate brand identity for PC House PLC which was recently listed on the Colombo Stock Exchange. The new brand identity reflects the change from a family owned business to a public company with a vision to be the benchmark for ICT in Sri Lanka.
source - www.dailymirror.lk
Affordably priced, these three phones are equipped with an array of stylish and attractive features. The phones have high quality sound for music lovers with hi-fi audio output for both FM as well as MP3 playback and crystal clear loudspeaker features. The phones support MP3 and MIDI formats of music.
The K550i, priced at Rs. 7,850 has a large screen and has a radio that operates without the need of connecting a headset, and also has the room for two memory cards, and has an inbuilt browser in and applications for Facebook, MSN, Yahoo messenger and offers amazing sound quality. The K111 comes with dual sim features along with digital camera, expandable memory and outstanding loudspeakers while the K515 sports amazing connectivity along with Nimbuzz, Snaptu, and Opera while also having an impressive battery life both phones are priced at Rs. 5,300 and Rs. 6,950 respectively.
Failan Saleem, COO, Mobile Handset division of PCH says, “The new Karbonn phones are stylish and affordable and are powered by hi-fi sound output for a high quality audio experience. This is a must-have for any music lover and the new generation of hand phone users.”
Over the years, dual SIM phones have become a preferred option especially in the rural market. Reiterating that dual SIMs is the new frontier for mobile telephony as it offers better connectivity at an affordable price, Saleem is confident that the Karbonn phones would be the best option for such users. “Apart from the benefit of having different numbers for different purposes, especially where a local SIM can take care of outgoing calls and the roaming capability of the other SIM could be used for receiving calls, the phones are backed by a proper warranty,” he added.
The new range of mobile phones will be available through PC Houses extensive customer dealership network to all customers across the island. The latest models offered will be ideally suited for the Sri Lankan market and will target everyday Sri Lankan consumers offering them basic and high end features that other mobile handsets do not offer at affordable prices.
S. H. M. Rishan, Chairman of PCH commenting on the launch of their new Karbonn mobiles stated, “In Karbonn mobiles we see a new opportunity to offer quality mobile handsets that are tailored to a Sri Lankan market. We especially want to offer affordable reliable mobile phones in the North and East of the country , as we have observed a great deal of development in the communication industry in this area. In doing so we seek to further ascertain the brand name of Karbonn in Sri Lanka and make it synonymous with PC House and the quality that has come to be expected from us. ”
Karbonn Mobiles is a new generation of mobile phones that redefine life in every way. Loaded with features, high quality, superior technology, service and more, it creates a perfect harmony between style and function.
PCH is the new corporate brand identity for PC House PLC which was recently listed on the Colombo Stock Exchange. The new brand identity reflects the change from a family owned business to a public company with a vision to be the benchmark for ICT in Sri Lanka.
source - www.dailymirror.lk
Browns, Neelakandan clarify Excel deal
Responding to media reports on the latest acquisition of Excel Global Holdings by Browns Group, the Board of Directors of Browns Investments Limited (BIL) wishes to state that Browns Investments Limited purchased the entirety, save one share, of the shares of Excel Global Holdings (Private) Limited (“the Company”) on 22nd of July 2011 from Francis Chokatte, Sherly Chokatte and Excel Global Holdings Limited.
The notice further said that the Company is the majority shareholder of Millennium Development (Private) Limited, which by Lease Agreement No. 1555 dated 11th March 2003, has leasehold rights to the land on which Excel Park is presently located.
“Browns Investments Limited wishes to state that it has plans to expand the existing facilities which are presently on the premises” the notice said adding the Board of Browns Investments Limited further wishes to state that any development or improvements will be made strictly in compliance with the provisions of the aforementioned Lease Agreement and in consultation with Incorporated Trustees of the Church of Ceylon, which is the owner of the said Land.
Moreover, any such improvements and developments will be made in a manner that will bring substantial value to the premises and to all stakeholders of the premises including the Incorporated Trustees of the Church of Ceylon.
In another development representing the lawyers for Incorporated Trustees of the Church of Ceylon, Attorney at law Neelakandan in a letter to Mirror Business had informed that it is incorrect and false for anyone to claim that “they have another 72 years according to the lease agreement to operate and run the property which is almost like an outright purchase” quoting our story titled ‘BIL to unveil mega plan for Excel World’.
Neelakandan in a second response had further stressed that the renewal of the lease is again giving a wrong impression in our second story titled “Browns looks at alternative location for City hotel’ published on yesterday.
Browns, Neelakandan...
However in our story we quoted the stock exchange filing by Browns (BRWN) that said “Excel Global Holdings is the 100% shareholder of Millennium Development Ltd which holds the long term lease of Excel World property located at Darley Road which is in extent of over six acres for a period of 40 years, and renewable for another 40 years.”
When queried from Neelakandan about the correct period of the lease, Neelakandan denied to respond, adding that he cannot disclose the terms of the lease.
source - www.dailymirror.lk
The notice further said that the Company is the majority shareholder of Millennium Development (Private) Limited, which by Lease Agreement No. 1555 dated 11th March 2003, has leasehold rights to the land on which Excel Park is presently located.
“Browns Investments Limited wishes to state that it has plans to expand the existing facilities which are presently on the premises” the notice said adding the Board of Browns Investments Limited further wishes to state that any development or improvements will be made strictly in compliance with the provisions of the aforementioned Lease Agreement and in consultation with Incorporated Trustees of the Church of Ceylon, which is the owner of the said Land.
Moreover, any such improvements and developments will be made in a manner that will bring substantial value to the premises and to all stakeholders of the premises including the Incorporated Trustees of the Church of Ceylon.
In another development representing the lawyers for Incorporated Trustees of the Church of Ceylon, Attorney at law Neelakandan in a letter to Mirror Business had informed that it is incorrect and false for anyone to claim that “they have another 72 years according to the lease agreement to operate and run the property which is almost like an outright purchase” quoting our story titled ‘BIL to unveil mega plan for Excel World’.
Neelakandan in a second response had further stressed that the renewal of the lease is again giving a wrong impression in our second story titled “Browns looks at alternative location for City hotel’ published on yesterday.
Browns, Neelakandan...
However in our story we quoted the stock exchange filing by Browns (BRWN) that said “Excel Global Holdings is the 100% shareholder of Millennium Development Ltd which holds the long term lease of Excel World property located at Darley Road which is in extent of over six acres for a period of 40 years, and renewable for another 40 years.”
When queried from Neelakandan about the correct period of the lease, Neelakandan denied to respond, adding that he cannot disclose the terms of the lease.
source - www.dailymirror.lk
JKH, USAID to set up Rs.400 mn cold chain
John Keells Logistics and USAID, in partnership have jointly committed an investment of more than Rs.400 million to implement a cold chain for agricultural and fisheries products in the North and East of Sri Lanka, the recent financials of John Keells Holdings (JKH) outlines.
In the latest quarterly results as of 30 June 2011 of the JKH it further notes that the company’s transportation sector profit before tax was a decrease of 7% over the first three months of financial year 2010/2011due to the translation impact arising from a stronger Sri Lankan Rupee.
However the financials notes that the South Asia gateway Terminals (SAGT) has ordered two new super post panamax cranes to be delivered in the fourth quarter which will further enhance its capability to handle the larger modern vessels, which in turn will increase productivity and capacity.
As per financials, JKH profit attributable to Equity Holders for the quarter had risen to Rs. 1.37 billion (by 35%) over Rs.1.01 billion in the previous year.
The Leisure industry of the group has recorded a significant improvement while the Colombo city hotels had seen a strong growth. Maldivian resort hotel sector had also seen an improved performance compared to the loss it had made in the first quarter of last year.
The rebranding and repositioning of Cinnamon Lakeside, in September 2009, has resulted in the hotel winning the Presidential Award for the best 5 star hotel in the city.
The Cinnamon Grand has been inducted into the Presidential “Hall of Fame” following three consecutive awards for the best 5 star city hotel.
Meanwhile the Property sector had recorded a Profit Before Tax (PBT) of Rs. 85 million for the quarter, a decrease of 41% over the corresponding period last year.
The financials stress that the cyclical nature of the revenue recognition of the property group’s projects is the main reason for the variance from the corresponding period in the previous year.
It also notes that ‘The Emperor’ project is scheduled for completion in September this year and the construction of the Rs. 7.8 billion apartment block, “OnThree20”, commenced in April this year, with over 65 per cent of the apartments sold off plan.
The recent sale of property in the city to Shangri-la and CATIC of China have
set a new benchmark for property prices in Colombo, and this has resulted in a significant enhancement of the value of JKH land bank in the city, the financials outline. The company also adds that during the quarter, JKH acquired a block of 6.5 acres in the suburbs of Colombo.
source - www.dailymirror.lk
In the latest quarterly results as of 30 June 2011 of the JKH it further notes that the company’s transportation sector profit before tax was a decrease of 7% over the first three months of financial year 2010/2011due to the translation impact arising from a stronger Sri Lankan Rupee.
However the financials notes that the South Asia gateway Terminals (SAGT) has ordered two new super post panamax cranes to be delivered in the fourth quarter which will further enhance its capability to handle the larger modern vessels, which in turn will increase productivity and capacity.
As per financials, JKH profit attributable to Equity Holders for the quarter had risen to Rs. 1.37 billion (by 35%) over Rs.1.01 billion in the previous year.
The Leisure industry of the group has recorded a significant improvement while the Colombo city hotels had seen a strong growth. Maldivian resort hotel sector had also seen an improved performance compared to the loss it had made in the first quarter of last year.
The rebranding and repositioning of Cinnamon Lakeside, in September 2009, has resulted in the hotel winning the Presidential Award for the best 5 star hotel in the city.
The Cinnamon Grand has been inducted into the Presidential “Hall of Fame” following three consecutive awards for the best 5 star city hotel.
Meanwhile the Property sector had recorded a Profit Before Tax (PBT) of Rs. 85 million for the quarter, a decrease of 41% over the corresponding period last year.
The financials stress that the cyclical nature of the revenue recognition of the property group’s projects is the main reason for the variance from the corresponding period in the previous year.
It also notes that ‘The Emperor’ project is scheduled for completion in September this year and the construction of the Rs. 7.8 billion apartment block, “OnThree20”, commenced in April this year, with over 65 per cent of the apartments sold off plan.
The recent sale of property in the city to Shangri-la and CATIC of China have
set a new benchmark for property prices in Colombo, and this has resulted in a significant enhancement of the value of JKH land bank in the city, the financials outline. The company also adds that during the quarter, JKH acquired a block of 6.5 acres in the suburbs of Colombo.
source - www.dailymirror.lk
CIFL oversubscribed slightly
Central Investments and Finance Limited’s (CIFL) in a filing to the stock exchange said that it had received 5250 applications via cheques and bank drafts for a consideration of Rs.376.33 million, and received 5 bank guarantees for a consideration of Rs.50.5 million out of a total of Rs.426.83 million.
CIFL was planning to raise Rs. 400 million by issuing 40 million ordinary voting shares at an issue price of Rs.10 per share.
source - www.dailymirror.lk
CIFL was planning to raise Rs. 400 million by issuing 40 million ordinary voting shares at an issue price of Rs.10 per share.
source - www.dailymirror.lk
Brokers to reappeal on credit for retailers?
By Jithendra Antonio
The twice best performed second capital market in the world, Colombo Stock exchange has tumbled to its worst performance in 2011. Stock brokers have now resorted to boost retail activities, requesting to extend the broker provided credit, Mirror Business learns.
According to a top official of the stock broking community, at meeting held on Monday, almost all the Chief Executive Officers of stock broking firms had agreed and signed letters stating that brokering firms should be able to lend their excess funds above the minimum capital requirement to their trade debtors.
“We will soon submit our letter to the Securities and Exchange Commission,” our source added.
However, Mirror Business learns that two broking firms which are units of two joint investment managing arms who brought in overpriced IPO’s for listing in recent times, had disagreed on providing broker credit.
“No one can prevent us from lending to clients, and what we can do anything with excess money which is above the minimum capital requirement’ our source said.
“Further, CEOs also agreed that it is fair enough for the brokering firms to leverage one time as it was allowed once. Finance companies in the country are allowed to leverage 10 times and leasing companies are allowed to leverage 7 times,” he pointed out.
According to the industry, the biggest reason for the market to fall to its lowest in seven months during early this week was the declining interest of retailers.
“Retailers are the major force of the market, and they contribute 44% of the daily market turnover” he said adding that if broker provided credit could not facilitate those individuals who have portfolios less than Rs.2 million, the major driving force in the market will soon be eliminated.
On 29 November 2010 SEC Directed brokers to limit credit by December 2010, and was further extended till June 2011 after broking community made representation to SEC.
Sri Lankan regulator, from January 01, 2011, has banned all stock broking firms from providing credit to customers and encouraged banks to provide margins.
Subsequently, brokers cleared 50% of credit in March 2011 and then SEC again revived its directive allowing brokers to clear 25% of credit by September 30, and the rest by end of year 2011. Since then, market indices have gradually declined, and some investors had moved away from the capital market after burning their fingers, market analyst point out. Meanwhile, it is learnt that Colombo Stock Brokers’ Association made a representation to the SEC yesterday, requesting permission to provide credit for retailers.
source - www.dailymirror.lk
The twice best performed second capital market in the world, Colombo Stock exchange has tumbled to its worst performance in 2011. Stock brokers have now resorted to boost retail activities, requesting to extend the broker provided credit, Mirror Business learns.
According to a top official of the stock broking community, at meeting held on Monday, almost all the Chief Executive Officers of stock broking firms had agreed and signed letters stating that brokering firms should be able to lend their excess funds above the minimum capital requirement to their trade debtors.
“We will soon submit our letter to the Securities and Exchange Commission,” our source added.
However, Mirror Business learns that two broking firms which are units of two joint investment managing arms who brought in overpriced IPO’s for listing in recent times, had disagreed on providing broker credit.
“No one can prevent us from lending to clients, and what we can do anything with excess money which is above the minimum capital requirement’ our source said.
“Further, CEOs also agreed that it is fair enough for the brokering firms to leverage one time as it was allowed once. Finance companies in the country are allowed to leverage 10 times and leasing companies are allowed to leverage 7 times,” he pointed out.
According to the industry, the biggest reason for the market to fall to its lowest in seven months during early this week was the declining interest of retailers.
“Retailers are the major force of the market, and they contribute 44% of the daily market turnover” he said adding that if broker provided credit could not facilitate those individuals who have portfolios less than Rs.2 million, the major driving force in the market will soon be eliminated.
On 29 November 2010 SEC Directed brokers to limit credit by December 2010, and was further extended till June 2011 after broking community made representation to SEC.
Sri Lankan regulator, from January 01, 2011, has banned all stock broking firms from providing credit to customers and encouraged banks to provide margins.
Subsequently, brokers cleared 50% of credit in March 2011 and then SEC again revived its directive allowing brokers to clear 25% of credit by September 30, and the rest by end of year 2011. Since then, market indices have gradually declined, and some investors had moved away from the capital market after burning their fingers, market analyst point out. Meanwhile, it is learnt that Colombo Stock Brokers’ Association made a representation to the SEC yesterday, requesting permission to provide credit for retailers.
source - www.dailymirror.lk
Brandix crowned Asia’s ‘Best Brand’ & ‘Best Employer Brand’
Brandix Lanka Limited has been recognised as Asia’s ‘Best Brand’ and ‘Best Employer Brand’ winning dual honours at a prestigious international forum held in Singapore with the representation of 37 countries in Asia, extending from the Middle East to Australia.
Sri Lanka’s top apparel exporter was presented with the awards for ‘Asia’s Best Brand’ by the Chief Marketing Officer (CMO) Council and ‘Asia’s Best Employer Brand’ by the Employer Branding Institute together with the World HRD Congress and the Stars of the Industry Group at the 2011 CMO Asia Awards for Excellence in Branding and Marketing.
Ishan Dantanarayana, Chief People Officer (CPO) of the Brandix Group accepted the award for ‘Asia’s Best Employer Brand’ on behalf of the Group, while Anuk De Silva, Head of Corporate Communications of Brandix collected the award for ‘Asia’s Best Brand.’ Ms. Ashanthi Fernando, Head of Group HR Operations and Sujith Jayasekara, Group Works HR Manager of Brandix also attended the event which was held at the SUNTEC Singapore International Convention and Exhibition Centre on 22nd July 2011.
The award ceremony was attended by more than 200 eminent individuals in the region including leaders and senior decision makers in the spheres of Marketing, Branding and Human Resources as well as top bureaucrats.
Asia’s Best Brand Awards are judged by the Global Research Cell of the CMO Council - whose members control over US $ 200 billion in marketing spend - based on market dominance, brand longevity, goodwill, customer loyalty and market acceptance. Apart from financial aspects ‘contribution to society’ is also considered for the awards. Brandix’s commitment to reducing its Group-wide processing Carbon Footprint and its employee-friendly practices were cited among the reasons for awarding the Group top honours in the category.
Brandix was conferred Asia’s Best Employer Brand Award — initiated as a celebration of the best talent in Human Resources Development in the region — based on the Group’s strength in HR initiatives. These practices include, creating a culture of contribution and innovation at work, believing in a continuous journey of excellence in Human Resource policy and practices by driving a positive organisational health and inculcating values that help to achieve the vision, transformation, being a social employer and developing future leaders.
Some of the other prominent winners in this year’s Best Employer Brand award category were General Electric, Coca Cola, Microsoft, Oracle, HSBC, Yahoo!, Singapore Airlines, ANZ Bank, Hindustan Unilever, Marriott, Changi Airport, Panasonic, Emirates, Pfizer, Walmart, Lenovo, AirAsia, Malaysia Airlines, Prudential, Fuji Xerox, National Bank of Bahrain, Hong Kong Disneyland, Dubai Airports, LG Electronics, Nokia Siemens and Procter & Gamble.
source - www.island.lk
Sri Lanka’s top apparel exporter was presented with the awards for ‘Asia’s Best Brand’ by the Chief Marketing Officer (CMO) Council and ‘Asia’s Best Employer Brand’ by the Employer Branding Institute together with the World HRD Congress and the Stars of the Industry Group at the 2011 CMO Asia Awards for Excellence in Branding and Marketing.
Ishan Dantanarayana, Chief People Officer (CPO) of the Brandix Group accepted the award for ‘Asia’s Best Employer Brand’ on behalf of the Group, while Anuk De Silva, Head of Corporate Communications of Brandix collected the award for ‘Asia’s Best Brand.’ Ms. Ashanthi Fernando, Head of Group HR Operations and Sujith Jayasekara, Group Works HR Manager of Brandix also attended the event which was held at the SUNTEC Singapore International Convention and Exhibition Centre on 22nd July 2011.
The award ceremony was attended by more than 200 eminent individuals in the region including leaders and senior decision makers in the spheres of Marketing, Branding and Human Resources as well as top bureaucrats.
Asia’s Best Brand Awards are judged by the Global Research Cell of the CMO Council - whose members control over US $ 200 billion in marketing spend - based on market dominance, brand longevity, goodwill, customer loyalty and market acceptance. Apart from financial aspects ‘contribution to society’ is also considered for the awards. Brandix’s commitment to reducing its Group-wide processing Carbon Footprint and its employee-friendly practices were cited among the reasons for awarding the Group top honours in the category.
Brandix was conferred Asia’s Best Employer Brand Award — initiated as a celebration of the best talent in Human Resources Development in the region — based on the Group’s strength in HR initiatives. These practices include, creating a culture of contribution and innovation at work, believing in a continuous journey of excellence in Human Resource policy and practices by driving a positive organisational health and inculcating values that help to achieve the vision, transformation, being a social employer and developing future leaders.
Some of the other prominent winners in this year’s Best Employer Brand award category were General Electric, Coca Cola, Microsoft, Oracle, HSBC, Yahoo!, Singapore Airlines, ANZ Bank, Hindustan Unilever, Marriott, Changi Airport, Panasonic, Emirates, Pfizer, Walmart, Lenovo, AirAsia, Malaysia Airlines, Prudential, Fuji Xerox, National Bank of Bahrain, Hong Kong Disneyland, Dubai Airports, LG Electronics, Nokia Siemens and Procter & Gamble.
source - www.island.lk
Bourse up slightly, defends previous day’s gains
The Colombo bourse yesterday held Tuesday’s gains with both indices moving up on a turnover of nearly Rs.2 billion, same as the previous day, with the All Share Price Index up 11.99 points (0.18%) and the Milanka up 15.46 points (0.26%) with 121 gainers comfortably ahead of 77 losers.
"The market closed slightly up," Prashan Fernando of Acuity Stockbrokers said. "At one point it was negative but it was positive most of the day and closed on a positive note."
Browns generated the highest business volume with nearly 2.6 million shares traded between Rs.280 and Rs.294 losing Rs.5.70 to close at Rs.285 generating a turnover of Rs.744.8 million.
"Most of the trades were accounted for in crossings with seven parcels crossed at a price of Rs.290,’’ Fernando said.
Amana Takaful followed on the turnover league with over 150.6 million shares done between Rs.2.10 and Rs.2.20 closing flat at Rs.2.20. The counter contributed Rs.301.2 million to the business volume with one parcel of 150 million shares crossed at a Rs.2 price accounting for the bulk of the trades.
Retail activity was evident in Swarnamahal, Softlogic, Vallibel One and Browns Investments with all these counters other than Vallibel One posting price gains.
Swarnamahal was up Rs.12.70 to close at Rs.126 trading between a low of Rs.100.50 and Rs.127.50 while Softlogic gained a marginal 10 cents to close at Rs.24 on nearly 1.8 million shares done between Rs.23.60 and Rs.24.20.
Vallibel One was down 20 cents to close at Rs.28.50 on over 1.2 million shares done between Rs.28.30 and Rs.29 while Browns Investments gained 10 cents to close at Rs.5 with nearly 6.5 million shares done between Rs.4.80 and Rs.5.10.
JKH gained 80 cents to close at Rs.186.50 on over 0.1 million shares done between Rs.183 and Rs.188.70 while Dialog closed flat at Rs.8 on nearly 2.3 million shares done between Rs.7.90 and Rs.8.30.
Blue chip gainers included Sampath up Rs.2 to close at Rs.230 on 93,000 shares, Asian Hotel Properties up 20 cents to close at Rs.90.60 on nearly 0.2 million shares and Guardian Capital Partners (Watapota) up Rs.19.20 to close at Rs.173 on over 0.1 million shares.
First Capital Holdings where a dividend of Rs.2 per share was announced saw nearly 1.2 million shares traded between Rs.20.50 and Rs.22.40 gaining Rs.3.50 to close at Rs.22.10.
source - www.island.lk
"The market closed slightly up," Prashan Fernando of Acuity Stockbrokers said. "At one point it was negative but it was positive most of the day and closed on a positive note."
Browns generated the highest business volume with nearly 2.6 million shares traded between Rs.280 and Rs.294 losing Rs.5.70 to close at Rs.285 generating a turnover of Rs.744.8 million.
"Most of the trades were accounted for in crossings with seven parcels crossed at a price of Rs.290,’’ Fernando said.
Amana Takaful followed on the turnover league with over 150.6 million shares done between Rs.2.10 and Rs.2.20 closing flat at Rs.2.20. The counter contributed Rs.301.2 million to the business volume with one parcel of 150 million shares crossed at a Rs.2 price accounting for the bulk of the trades.
Retail activity was evident in Swarnamahal, Softlogic, Vallibel One and Browns Investments with all these counters other than Vallibel One posting price gains.
Swarnamahal was up Rs.12.70 to close at Rs.126 trading between a low of Rs.100.50 and Rs.127.50 while Softlogic gained a marginal 10 cents to close at Rs.24 on nearly 1.8 million shares done between Rs.23.60 and Rs.24.20.
Vallibel One was down 20 cents to close at Rs.28.50 on over 1.2 million shares done between Rs.28.30 and Rs.29 while Browns Investments gained 10 cents to close at Rs.5 with nearly 6.5 million shares done between Rs.4.80 and Rs.5.10.
JKH gained 80 cents to close at Rs.186.50 on over 0.1 million shares done between Rs.183 and Rs.188.70 while Dialog closed flat at Rs.8 on nearly 2.3 million shares done between Rs.7.90 and Rs.8.30.
Blue chip gainers included Sampath up Rs.2 to close at Rs.230 on 93,000 shares, Asian Hotel Properties up 20 cents to close at Rs.90.60 on nearly 0.2 million shares and Guardian Capital Partners (Watapota) up Rs.19.20 to close at Rs.173 on over 0.1 million shares.
First Capital Holdings where a dividend of Rs.2 per share was announced saw nearly 1.2 million shares traded between Rs.20.50 and Rs.22.40 gaining Rs.3.50 to close at Rs.22.10.
source - www.island.lk
Turnover Rs 2 b with Browns topping
Stock market swung between the positive and negative terrain in morning trade and ended in green position.
Benchmark ASI gained 11.98 index points (+0.18 percent) to close at 6,505.56 while more liquid MPI closed at 5,943.91, up 15.46 (+0.26 percent) index points. Daily market turnover stood at Rs 2.0 billion.
Browns and Company made the strongest contribution to the market turnover which accounted for nearly 38 percent of the total turnover.
Rs 744.5 million turnover was recorded by Browns & Company with 2.5 million shares changed hands as seven crossings at a price of Rs 290.0 per share. Browns & Company reached the high of Rs 294.00 and closed at Rs 285.00, down Rs 6.00.
Amana Takaful made the second highest contribution to the turnover with an amount of Rs 301.4 million. Amana also recorded an off-the-floor deal of 150 million shares at a price of Rs 2.00 per share which is accounted for 15 percent of the total issued shares of the company. Amana closed at Rs 2.20, up Rs 0.10.
Swarnamahal Financial Services was the actively traded counter during the day and ended with 3rd highest contribution to the daily turnover (Rs 158.8 million). Swarnamahal Financial Services reached the high of Rs 127.50 and closed at Rs 126.00, up Rs 13.50.
Further counters such as First Capital Holdings, Brawns Investments and Gardian Capital Parthers depicted active trading during the day. First Capital Holdings today announced an interim dividend of Rs 2.00 per share for financial year 2011 and 2012.
Foreign participation further dropped to 3 percent of the total market activity. Foreign investors ended as net sellers with a net foreign outflow of Rs 10.2 million.
Lanka Securities Research
source - www.dailynews.lk
Benchmark ASI gained 11.98 index points (+0.18 percent) to close at 6,505.56 while more liquid MPI closed at 5,943.91, up 15.46 (+0.26 percent) index points. Daily market turnover stood at Rs 2.0 billion.
Browns and Company made the strongest contribution to the market turnover which accounted for nearly 38 percent of the total turnover.
Rs 744.5 million turnover was recorded by Browns & Company with 2.5 million shares changed hands as seven crossings at a price of Rs 290.0 per share. Browns & Company reached the high of Rs 294.00 and closed at Rs 285.00, down Rs 6.00.
Amana Takaful made the second highest contribution to the turnover with an amount of Rs 301.4 million. Amana also recorded an off-the-floor deal of 150 million shares at a price of Rs 2.00 per share which is accounted for 15 percent of the total issued shares of the company. Amana closed at Rs 2.20, up Rs 0.10.
Swarnamahal Financial Services was the actively traded counter during the day and ended with 3rd highest contribution to the daily turnover (Rs 158.8 million). Swarnamahal Financial Services reached the high of Rs 127.50 and closed at Rs 126.00, up Rs 13.50.
Further counters such as First Capital Holdings, Brawns Investments and Gardian Capital Parthers depicted active trading during the day. First Capital Holdings today announced an interim dividend of Rs 2.00 per share for financial year 2011 and 2012.
Foreign participation further dropped to 3 percent of the total market activity. Foreign investors ended as net sellers with a net foreign outflow of Rs 10.2 million.
Lanka Securities Research
source - www.dailynews.lk
Browns clarifies . . .
Browns Investments has sent the following clarifying various reports that have appeared in several newspapers regarding the facts and circumstances relating to their acquisition of Excel Global holdings (Private) Limited.
The Board of Directors of Browns Investments Limited clearing any confusion that may exist in this regard said Browns Investments Limited purchased the entirety, save one share, of the shares of Excel Global Holdings (Private) Limited (‘the Company’) on July 22 from Francis Chokatte, Mrs. Sherly Chokatte and Excel Global Holdings Limited.
“The Company is the majority shareholder of Millennium Development (Private) Limited, which by Lease Agreement No. 1555 dated March 11, 2003, has leasehold rights to the land on which Excel Park is presently located.
Browns Investments Limited wishes to state that it has plans to expand the existing facilities which are presently on the premises.
The Board of Browns Investments Limited further wish to state that any development or improvements will be made strictly in compliance with the provisions of the aforementioned Lease Agreement and in consultation with Incorporated Trustees of the Church of Ceylon, which is the owner of the said land.
Moreover, any such improvements and developments will be made in a manner that will bring substantial value to the premises and to all stakeholders of the premises including the Incorporated Trustees of the Church of Ceylon.
source - www.dailynews.lk
The Board of Directors of Browns Investments Limited clearing any confusion that may exist in this regard said Browns Investments Limited purchased the entirety, save one share, of the shares of Excel Global Holdings (Private) Limited (‘the Company’) on July 22 from Francis Chokatte, Mrs. Sherly Chokatte and Excel Global Holdings Limited.
“The Company is the majority shareholder of Millennium Development (Private) Limited, which by Lease Agreement No. 1555 dated March 11, 2003, has leasehold rights to the land on which Excel Park is presently located.
Browns Investments Limited wishes to state that it has plans to expand the existing facilities which are presently on the premises.
The Board of Browns Investments Limited further wish to state that any development or improvements will be made strictly in compliance with the provisions of the aforementioned Lease Agreement and in consultation with Incorporated Trustees of the Church of Ceylon, which is the owner of the said land.
Moreover, any such improvements and developments will be made in a manner that will bring substantial value to the premises and to all stakeholders of the premises including the Incorporated Trustees of the Church of Ceylon.
source - www.dailynews.lk
JKH posts Rs 1.37 b profit in Q2
John Keells Holdings PLC posted an impressive financial performance for the three months ended June 30, 2011.
John Keells Holdings PLC Chairman Susantha Ratnayake said profit attributable to equity holders for the quarter is Rs 1.37 billion and reflects an increase of 35 per cent over the Rs 1.01 billion in the corresponding period in the previous year.
Profit before tax (PBT) of Rs 1.88 billion for the quarter is an increase of 23 per cent over the PBT of Rs 1.53 billion in the corresponding period in the previous year. The revenue at Rs 15.69 billion in the first quarter was 21 per cent above the Rs 12.92 billion recorded in the corresponding period in the previous year.
The company PBT of Rs 1.02 billion for the quarter was marginally above the Rs 1.01 billion recorded in the corresponding period in the previous year.
source - www.dailynews.lk
John Keells Holdings PLC Chairman Susantha Ratnayake said profit attributable to equity holders for the quarter is Rs 1.37 billion and reflects an increase of 35 per cent over the Rs 1.01 billion in the corresponding period in the previous year.
Profit before tax (PBT) of Rs 1.88 billion for the quarter is an increase of 23 per cent over the PBT of Rs 1.53 billion in the corresponding period in the previous year. The revenue at Rs 15.69 billion in the first quarter was 21 per cent above the Rs 12.92 billion recorded in the corresponding period in the previous year.
The company PBT of Rs 1.02 billion for the quarter was marginally above the Rs 1.01 billion recorded in the corresponding period in the previous year.
source - www.dailynews.lk
Sampath to draw profits from all branches
Ravi LADDUWAHETTY
Sampath Bank will draw profits from its 200 plus branches from next year and the branch expansions will be therefore restricted. “We have done an analysis of the new branches where some have been given two years to break even while some have even broken even in eight and ten months but by next year, all the branches will report profits,” Sampath Bank Managing Director and CEO Harris Premaratne told an Investors’ Forum cum news conference at the Hilton Colombo last night.
He also said that Sampath had spent Rs 1 billion for the branch expansion last year where ten branches were parallely opened on the same day but the strategy from now onwards would be to open around six branches a year and those will be only in the metro areas.
“This is because we have covered the entire country by now and there is no need for an aggressive branch expansion,” he said.
He said, Sampath will also challenge the market with the best deposits and interest rates and added that the bank had gone out of the way to attract depositors with unusually high interest rates to accommodate clients.
He said that the strategy of the bank, in an environment of reducing interests would be to have the most competitive interest rates and have the growth in terms of volumes.
He also said that the ideal strategy that his bank would implement would be to let the corporates to grow so that the bank could provide the lending at the most competitive rates so that the corporates and the banks could both grow.
He also said that the bank had one of the best Non Performing Ratios among the local banks, claiming that the current 3.19% would be brought to 2%. There has also been substantial credit growth in the bank, but stressed that the environment was extremely competitive.
The progress in the Non Performing loans has been extremely good where it has been reduced from Rs 9 billion to Rs 5 billion, he noted.
One of the drawbacks to the development of the business was the foreign banks in Colombo offering dollar loans to local corporates. “One cannot earn 6% on corporate debt,” he said.
He also said that there was lots of potential in the pawning business especially with the well spread out network of branches.
source - www.dailynews.lk
Sampath Bank will draw profits from its 200 plus branches from next year and the branch expansions will be therefore restricted. “We have done an analysis of the new branches where some have been given two years to break even while some have even broken even in eight and ten months but by next year, all the branches will report profits,” Sampath Bank Managing Director and CEO Harris Premaratne told an Investors’ Forum cum news conference at the Hilton Colombo last night.
He also said that Sampath had spent Rs 1 billion for the branch expansion last year where ten branches were parallely opened on the same day but the strategy from now onwards would be to open around six branches a year and those will be only in the metro areas.
“This is because we have covered the entire country by now and there is no need for an aggressive branch expansion,” he said.
He said, Sampath will also challenge the market with the best deposits and interest rates and added that the bank had gone out of the way to attract depositors with unusually high interest rates to accommodate clients.
He said that the strategy of the bank, in an environment of reducing interests would be to have the most competitive interest rates and have the growth in terms of volumes.
He also said that the ideal strategy that his bank would implement would be to let the corporates to grow so that the bank could provide the lending at the most competitive rates so that the corporates and the banks could both grow.
He also said that the bank had one of the best Non Performing Ratios among the local banks, claiming that the current 3.19% would be brought to 2%. There has also been substantial credit growth in the bank, but stressed that the environment was extremely competitive.
The progress in the Non Performing loans has been extremely good where it has been reduced from Rs 9 billion to Rs 5 billion, he noted.
One of the drawbacks to the development of the business was the foreign banks in Colombo offering dollar loans to local corporates. “One cannot earn 6% on corporate debt,” he said.
He also said that there was lots of potential in the pawning business especially with the well spread out network of branches.
source - www.dailynews.lk
Kelani Cables set to conquer Africa
Ravi LADDUWAHETTY
Kelani Cables PLC is well set to conquer the South African market, beginning with South Africa and making inroads into neighbouring eight countries-starting from Botswana, Nigeria and Zimbabwe. The local manufacturer of copper cables already has a brand presence in Rwanda, Uganda and Djibouti.
Mahinda Saranapala
“We will be shortly be entering the South African market through Durban, Johannesburg and Cape Town and will be making inroads into neighbouring countries- Botswana, Nigeria and Zimbabwe and leveraging our present brand presence in Rwanda, Uganda and Djibouti, an upbeat Kelani Cables CEO Mahinda Saranapala told Daily News Business.
Saranapala said the company was on a Rs 3.8 billion turnover where the export revenue was Rs 590 million and the sales in the now liberated North and the East was Rs 210 million, which he describes as growing with prospects in growth, fresh and buoyant after three decades of holocaust.
Kelani Cables also hosted a stall in the South African Internation Trade Exhibition (SAITEX) where over 20 South African institutional and retail clients are expected to firm up their inquiries soon.
“There is a huge untapped potential in the South African market as both the quality of the cables manufactured there and also imports from China are low quality and I have already met dealers who supply the households and also the industrial customers who will firm up their orders shortly,” Export Sales Manager Devinda Lorensuhewa said.
Kelani Cables is also exporting the product to other markets in the Maldives, in which it has a strong brand presence along with India, Bangladesh, Pakistan, Japan, Seychelles and Mauritius.
Strident in the light of the company using 99.96 percent copper in its wires to maintain pure quality, is the export of its enamel winding wire to discerning Japanese markets and also to Norwegian giant Noratel, a transformer manufacturer, whose exports extends to a majority of European nations.
source - www.dailynews.lk
Kelani Cables PLC is well set to conquer the South African market, beginning with South Africa and making inroads into neighbouring eight countries-starting from Botswana, Nigeria and Zimbabwe. The local manufacturer of copper cables already has a brand presence in Rwanda, Uganda and Djibouti.
Mahinda Saranapala
“We will be shortly be entering the South African market through Durban, Johannesburg and Cape Town and will be making inroads into neighbouring countries- Botswana, Nigeria and Zimbabwe and leveraging our present brand presence in Rwanda, Uganda and Djibouti, an upbeat Kelani Cables CEO Mahinda Saranapala told Daily News Business.
Saranapala said the company was on a Rs 3.8 billion turnover where the export revenue was Rs 590 million and the sales in the now liberated North and the East was Rs 210 million, which he describes as growing with prospects in growth, fresh and buoyant after three decades of holocaust.
Kelani Cables also hosted a stall in the South African Internation Trade Exhibition (SAITEX) where over 20 South African institutional and retail clients are expected to firm up their inquiries soon.
“There is a huge untapped potential in the South African market as both the quality of the cables manufactured there and also imports from China are low quality and I have already met dealers who supply the households and also the industrial customers who will firm up their orders shortly,” Export Sales Manager Devinda Lorensuhewa said.
Kelani Cables is also exporting the product to other markets in the Maldives, in which it has a strong brand presence along with India, Bangladesh, Pakistan, Japan, Seychelles and Mauritius.
Strident in the light of the company using 99.96 percent copper in its wires to maintain pure quality, is the export of its enamel winding wire to discerning Japanese markets and also to Norwegian giant Noratel, a transformer manufacturer, whose exports extends to a majority of European nations.
source - www.dailynews.lk
Wednesday, July 27, 2011
Sri Lanka stocks close up 0.18-pct
July 27, 2011 (LBO) - Sri Lankan stocks close up for the second straight day, with recently listed Swarnamahal Financial Services, dominating trading brokers said.
The benchmark All Share Price Index up 0.18 percent or 11.98 points to 6,505.56, while the Milanka Index of more liquid stocks closed up 0.26 percent (0.57 points) to 5,943.91, according to stock exchange provisional figures.
Turnover was 1.96 billion rupees. There were 134 gainers and 83 losers.
Swarnamahal Financial was the main contributor to the day’s turnover, closing at 125.20 rupees up 12.70 rupees or 11.29 percent with 1.3 million shares worth 158.7 million rupees changing hands.
Vallibel One closed at 28.50 rupees down 0.70 rupees or 0.20 percent. More than 1.2 million Vallibel One shares were traded at generating 34.7 million rupees.
Browns Investments closed at 4.90 rupees up 0.10 rupees or 2.08 percent. More than 6.4 million Browns Investments shares were traded generating 32 million rupees.
Gestetner of Ceylon PLC, an office equipment firm was the highest percentage gainer of the day closing at 250.00 rupees up 38.80 rupees or 19.50 percent.
Renewed interest also shown in First Capital, Watapotha and The Finance non –voting, broker said.
Wednesday’s crossings or off market private deals were Amana Takaful 150 million shares at 02 rupees and Brown & Company PLC 2,543,400 shares at 290 rupees.
source - www.lbo.lk
The benchmark All Share Price Index up 0.18 percent or 11.98 points to 6,505.56, while the Milanka Index of more liquid stocks closed up 0.26 percent (0.57 points) to 5,943.91, according to stock exchange provisional figures.
Turnover was 1.96 billion rupees. There were 134 gainers and 83 losers.
Swarnamahal Financial was the main contributor to the day’s turnover, closing at 125.20 rupees up 12.70 rupees or 11.29 percent with 1.3 million shares worth 158.7 million rupees changing hands.
Vallibel One closed at 28.50 rupees down 0.70 rupees or 0.20 percent. More than 1.2 million Vallibel One shares were traded at generating 34.7 million rupees.
Browns Investments closed at 4.90 rupees up 0.10 rupees or 2.08 percent. More than 6.4 million Browns Investments shares were traded generating 32 million rupees.
Gestetner of Ceylon PLC, an office equipment firm was the highest percentage gainer of the day closing at 250.00 rupees up 38.80 rupees or 19.50 percent.
Renewed interest also shown in First Capital, Watapotha and The Finance non –voting, broker said.
Wednesday’s crossings or off market private deals were Amana Takaful 150 million shares at 02 rupees and Brown & Company PLC 2,543,400 shares at 290 rupees.
source - www.lbo.lk
Bourse survives
The Colombo stock market yesterday finally averted a bizarre crash thanks to return of fresh buying boosting the Bourse’s worth by Rs. 31 billion.
The All Share Index gained by 59 points or near 1% and Milanka by 34 points (slightly over 0.5%) whilst turnover was a healthy Rs. 2 billion. Of the 232 companies traded, 152 or over 65% achieved gains.
Yesterday’s recovery was a sigh of relief for all stakeholders of the market as it had lost Rs. 121 billion in value in the previous six days whilst ASPI was down 3% year to date and 17% since mid-February peak.
“The indices remained volatile during the day with the ASPI declining marginally before rebounding sharply on renewed buying across the board,” John Keells Stock Brokers said.
“ Indices bounced back after dipping during early trading, with the increased participation of investors. A strong buying momentum was witnessed across the board during the latter half,” NDB Stockbrokers said.
“However, some blue chip counters failed to get into the positive trend. Indices ended in green after ending in red for four consecutive days,” it added.
“Following the steep dip in performance leading most counters to be attractively priced, investors plunged into a buying mode today making use of the bargain,” Arrenga Capital said.
Best performing sector was Stores & Supplies (+3.31%) whilst the worst was Services (-0.26%).
NDBB said diversified sector was the main contributor to the market turnover (due to Browns Investments, Softlogic Holdings and JKH), while the sector index rose by 0.16%. Banks, Finance & Insurance sector also contributed significantly to the turnover (due to Central Finance and Swarnamahal Finance). The sector index rose 1.28%. The share price of CF rose by Rs. 34.60 (2.45%) and closed at Rs. 1,430.10. Interest was witnessed in Swarnamahal Finance and selling pressure continued in JKH.
source - www.ft.lk
The All Share Index gained by 59 points or near 1% and Milanka by 34 points (slightly over 0.5%) whilst turnover was a healthy Rs. 2 billion. Of the 232 companies traded, 152 or over 65% achieved gains.
Yesterday’s recovery was a sigh of relief for all stakeholders of the market as it had lost Rs. 121 billion in value in the previous six days whilst ASPI was down 3% year to date and 17% since mid-February peak.
“The indices remained volatile during the day with the ASPI declining marginally before rebounding sharply on renewed buying across the board,” John Keells Stock Brokers said.
“ Indices bounced back after dipping during early trading, with the increased participation of investors. A strong buying momentum was witnessed across the board during the latter half,” NDB Stockbrokers said.
“However, some blue chip counters failed to get into the positive trend. Indices ended in green after ending in red for four consecutive days,” it added.
“Following the steep dip in performance leading most counters to be attractively priced, investors plunged into a buying mode today making use of the bargain,” Arrenga Capital said.
Best performing sector was Stores & Supplies (+3.31%) whilst the worst was Services (-0.26%).
NDBB said diversified sector was the main contributor to the market turnover (due to Browns Investments, Softlogic Holdings and JKH), while the sector index rose by 0.16%. Banks, Finance & Insurance sector also contributed significantly to the turnover (due to Central Finance and Swarnamahal Finance). The sector index rose 1.28%. The share price of CF rose by Rs. 34.60 (2.45%) and closed at Rs. 1,430.10. Interest was witnessed in Swarnamahal Finance and selling pressure continued in JKH.
source - www.ft.lk
BIL’s 2011FY post-tax profit tops Rs. 2 b
Browns Investments Ltd’s consolidated after-tax profit in the 31 March, 2011 ended financial year had topped the Rs. 2 billion mark, an exponential growth in comparison to Rs. 155 million in the previous year.
As per audited accounts released this week, net profit attributable to equity holders amounted to Rs. 1.9 billion, as against Rs. 43.5 million in FY2010.
Browns Investments is a diversified company with interests in leisure, plantations, manufacturing, construction, cable manufacturing, agriculture and hydro power generation. It has plans to further expand in leisure as well as enter real estate.
Group revenue had topped the Rs. 3 billion mark as well from Rs. 2.45 billion in the previous year whilst pre-tax profit grew from Rs. 174 million to Rs. 2.13 billion.
Total assets at Group level amounted to Rs. 11.85 billion including Rs. 4 billion in short term investments) as at 31 March, 2011, up from Rs. 7.2 billion a year earlier whilst that of the company grew from Rs. 1.3 billion to Rs. 7.4 billion.
Non-current liabilities were Rs. 1.56 billion, as against Rs. 1.36 billion a year earlier whilst current liabilities had dipped to Rs. 688.3 million from Rs. 830.5 million bringing total group liabilities to Rs. 2.24 billion, from Rs. 2.19 billion in FY2010. Net asset per share was Rs. 4.47 at Group level and Rs. 3.65 at company level.
Revenue from investments and tea business had generated Rs. 1.2 billion each in revenue. Whilst revenue from investments was up from Rs. 9.2 billion in FY2010, tea reflected a lower performance as opposed to Rs. 1.9 billion in FY2010. Despite the lower revenue, tea business produced a gross profit of Rs. 66 million as against a loss of Rs. 9 million. Rubber which generated revenues of Rs. 467 million in FY2011, ensured a profit of Rs. 270 million. In FY2010 these figures were Rs. 485.6 million and Rs. 155 million respectively.
BIL’s hydro business revenues were Rs. 37 million, up from Rs. 2.7 million and profit amounted to Rs. 26.7 million as against Rs. 1.3 million in FY2010. Market value adjustments for carrying value of short term investments was Rs. 127 million whilst gain on deemed disposal of interest in joint venture was Rs. 327 million. BIL’s joint venture Free Lanka Capital Holdings went public and formers holding in the latter reduced to 22.7% resulting in a gain of Rs. 327 million.
source - www.ft.lk
As per audited accounts released this week, net profit attributable to equity holders amounted to Rs. 1.9 billion, as against Rs. 43.5 million in FY2010.
Browns Investments is a diversified company with interests in leisure, plantations, manufacturing, construction, cable manufacturing, agriculture and hydro power generation. It has plans to further expand in leisure as well as enter real estate.
Group revenue had topped the Rs. 3 billion mark as well from Rs. 2.45 billion in the previous year whilst pre-tax profit grew from Rs. 174 million to Rs. 2.13 billion.
Total assets at Group level amounted to Rs. 11.85 billion including Rs. 4 billion in short term investments) as at 31 March, 2011, up from Rs. 7.2 billion a year earlier whilst that of the company grew from Rs. 1.3 billion to Rs. 7.4 billion.
Non-current liabilities were Rs. 1.56 billion, as against Rs. 1.36 billion a year earlier whilst current liabilities had dipped to Rs. 688.3 million from Rs. 830.5 million bringing total group liabilities to Rs. 2.24 billion, from Rs. 2.19 billion in FY2010. Net asset per share was Rs. 4.47 at Group level and Rs. 3.65 at company level.
Revenue from investments and tea business had generated Rs. 1.2 billion each in revenue. Whilst revenue from investments was up from Rs. 9.2 billion in FY2010, tea reflected a lower performance as opposed to Rs. 1.9 billion in FY2010. Despite the lower revenue, tea business produced a gross profit of Rs. 66 million as against a loss of Rs. 9 million. Rubber which generated revenues of Rs. 467 million in FY2011, ensured a profit of Rs. 270 million. In FY2010 these figures were Rs. 485.6 million and Rs. 155 million respectively.
BIL’s hydro business revenues were Rs. 37 million, up from Rs. 2.7 million and profit amounted to Rs. 26.7 million as against Rs. 1.3 million in FY2010. Market value adjustments for carrying value of short term investments was Rs. 127 million whilst gain on deemed disposal of interest in joint venture was Rs. 327 million. BIL’s joint venture Free Lanka Capital Holdings went public and formers holding in the latter reduced to 22.7% resulting in a gain of Rs. 327 million.
source - www.ft.lk
Browns Investments bites the dust too!
New debutant diversified holding Browns Investments Ltd., (BIL) yesterday became the second stock to close lower from its IPO price.
Marking its maiden trading on the Diri Savi Board of the Colombo Stock Exchange, Browns Investments saw 74.7 million of its shares change hands via 4,036 trades generating a turnover of Rs. 374.3 million, highest for the day. The price peaked to a high of Rs. 5.30 before closing at Rs. 4.80, down by 20 cents.
Softlogic Holdings was the first stock in recent years to close on its debut below IPO price. On 12 July it closed at Rs. 18.10, down by Rs. 10.90 as opposed to offer price of Rs. 29.
First off the block for Browns Investments yesterday was 783,600 shares executed at Rs. 5.10 each via 416 trades. Thereafter 1.34 million shares were done at Rs. 5.20 each via 183 trades followed by 2,000 shares at Rs. 5.30 via just two trades. Overall only 11,000 shares traded at peak price of Rs. 5.30 including some small blocks like 200 shares.
Via its IPO Browns Investments made available 50 million shares at Rs. 5 each, the same price as it did the Rs. 4 billion private placement.
The quantity traded yesterday amounted to over 50% of the offered volume via IPO but constituted only 4% of the number of shares in issue.
Whilst BIL hitting Rs. 5.30 in early morning trade raised hopes for investors but it finished the debut 20 below IPO price has only made prospects for slate of new IPOs bleak. Unlike Softlogic, there was no change in private placement and IPO price. Browns Investments IPO was oversubscribed by 5.3 times.
“Most of the retailers who took part in the IPO as well as a few others who came into the private placement are likely to have sold out,” analysts added.
They said why people sold out at Rs. 5 and below could be to have cash and avert further losses.
“The market of late has been highly suspicious of any gain in stock prices. Buyers behave as if prices will continue to fall,” analysts added. Others said that BIL performance was commendable given the mood of the market whilst most investors sold out of panic as well.
Lanka Securities said the counter (BIL) depicted another unsuccessful IPO debut with notable price depreciation.
Arrenga Capital said BIL saw selling pressure rising with several mid-sized blocks coming up for sale.
Browns Investments is a diversified company with interests in leisure, plantations, manufacturing, construction, cable manufacturing, agriculture and hydro power generation. It has plans to further expand in leisure as well as enter real estate.
The Rs. 250 million IPO attracted 17,501 applications requesting for 266.6 million shares worth Rs. 1.33 billion. There were 17,476 applications via bank draft and cheques requesting for 94.24 million shares worth Rs. 471.2 million whilst applications via bank guarantees were 25 requesting for 172.4 million shares worth Rs. 862 million. Proceeds from the IPO will be used to finance a new 150 room Samudra Beach Hotel in Kosgoda via subsidiary Samudra Beach Resorts Ltd.
source - www.ft.lk
Marking its maiden trading on the Diri Savi Board of the Colombo Stock Exchange, Browns Investments saw 74.7 million of its shares change hands via 4,036 trades generating a turnover of Rs. 374.3 million, highest for the day. The price peaked to a high of Rs. 5.30 before closing at Rs. 4.80, down by 20 cents.
Softlogic Holdings was the first stock in recent years to close on its debut below IPO price. On 12 July it closed at Rs. 18.10, down by Rs. 10.90 as opposed to offer price of Rs. 29.
First off the block for Browns Investments yesterday was 783,600 shares executed at Rs. 5.10 each via 416 trades. Thereafter 1.34 million shares were done at Rs. 5.20 each via 183 trades followed by 2,000 shares at Rs. 5.30 via just two trades. Overall only 11,000 shares traded at peak price of Rs. 5.30 including some small blocks like 200 shares.
Via its IPO Browns Investments made available 50 million shares at Rs. 5 each, the same price as it did the Rs. 4 billion private placement.
The quantity traded yesterday amounted to over 50% of the offered volume via IPO but constituted only 4% of the number of shares in issue.
Whilst BIL hitting Rs. 5.30 in early morning trade raised hopes for investors but it finished the debut 20 below IPO price has only made prospects for slate of new IPOs bleak. Unlike Softlogic, there was no change in private placement and IPO price. Browns Investments IPO was oversubscribed by 5.3 times.
“Most of the retailers who took part in the IPO as well as a few others who came into the private placement are likely to have sold out,” analysts added.
They said why people sold out at Rs. 5 and below could be to have cash and avert further losses.
“The market of late has been highly suspicious of any gain in stock prices. Buyers behave as if prices will continue to fall,” analysts added. Others said that BIL performance was commendable given the mood of the market whilst most investors sold out of panic as well.
Lanka Securities said the counter (BIL) depicted another unsuccessful IPO debut with notable price depreciation.
Arrenga Capital said BIL saw selling pressure rising with several mid-sized blocks coming up for sale.
Browns Investments is a diversified company with interests in leisure, plantations, manufacturing, construction, cable manufacturing, agriculture and hydro power generation. It has plans to further expand in leisure as well as enter real estate.
The Rs. 250 million IPO attracted 17,501 applications requesting for 266.6 million shares worth Rs. 1.33 billion. There were 17,476 applications via bank draft and cheques requesting for 94.24 million shares worth Rs. 471.2 million whilst applications via bank guarantees were 25 requesting for 172.4 million shares worth Rs. 862 million. Proceeds from the IPO will be used to finance a new 150 room Samudra Beach Hotel in Kosgoda via subsidiary Samudra Beach Resorts Ltd.
source - www.ft.lk
Bourse recovers slightly
The Colombo bourse bounced back yesterday, after a seven month low on the previous day. Analysts see it as temporary.
The indices, All Share Index gained 59.24 points closing at 6493.58 while Milanka gaining 33.88 points to close at 5928.45. The turnover for the day was Rs.1.99 billion.
However, the day started with a negative note when the All Share Index (ASI) dipped even lower before the previous day to 6415.7. The market then bounced back strongly, following buying spree unleashed by investors.Yesterday. the Colombo bourse saw four major crossings. A crossing of 175, 000 shares of Central Finance took place at Rs.1450 while a crossing of one million shares of Soflogic Holdigns at Rs.23.70. Another crossing of 123, 200 shares of John Keells took place at Rs,185 and 2.5 million crossing of Dialog shares at Rs.8. “I don’t think we’ll be able to sustain this.
This is temporary. The market is heading for a correction,” a market analyst told Mirror Business.
He also said the bouncing back was due to technical analysis which determines the bottom that is going to be at a certain level based on the past data, as the market hit 7 month low on the previous day.
“When this information gets disseminated, everyone starts buying. I think that’s what happened” the analyst said.
According to BMS daily market report, Investor speculation on extending credit days paved the way for the abrupt surge. “Retail investors were more active during today’s trading session. Foreign investors emerged as net sellers. Price gainers outperformed losers 166 to 68,” the report noted.
Gainless performance by BIL
The debut shares of Browns Investments PLC (BIL) opened 10 cents above the issue price of Rs.5 yesterday.
The highest price the share traded was Rs.5.30 and the lowest was Rs.4.5. The average share price stood at Rs.5.
The debutant share contributed Rs.374 million to the day’s turnover whilst 74.7 million shares changed hands. It was evident that the initial investors and private placement parties also disposed some of their shares on the first day of trading.
BIL offered 50 million shares to the public at Rs.5 per share to raise Rs.250 million. Before that, 830 million shares were issued to private parties at the same price in February this year.
source - www.dailymirror.lk
The indices, All Share Index gained 59.24 points closing at 6493.58 while Milanka gaining 33.88 points to close at 5928.45. The turnover for the day was Rs.1.99 billion.
However, the day started with a negative note when the All Share Index (ASI) dipped even lower before the previous day to 6415.7. The market then bounced back strongly, following buying spree unleashed by investors.Yesterday. the Colombo bourse saw four major crossings. A crossing of 175, 000 shares of Central Finance took place at Rs.1450 while a crossing of one million shares of Soflogic Holdigns at Rs.23.70. Another crossing of 123, 200 shares of John Keells took place at Rs,185 and 2.5 million crossing of Dialog shares at Rs.8. “I don’t think we’ll be able to sustain this.
This is temporary. The market is heading for a correction,” a market analyst told Mirror Business.
He also said the bouncing back was due to technical analysis which determines the bottom that is going to be at a certain level based on the past data, as the market hit 7 month low on the previous day.
“When this information gets disseminated, everyone starts buying. I think that’s what happened” the analyst said.
According to BMS daily market report, Investor speculation on extending credit days paved the way for the abrupt surge. “Retail investors were more active during today’s trading session. Foreign investors emerged as net sellers. Price gainers outperformed losers 166 to 68,” the report noted.
Gainless performance by BIL
The debut shares of Browns Investments PLC (BIL) opened 10 cents above the issue price of Rs.5 yesterday.
The highest price the share traded was Rs.5.30 and the lowest was Rs.4.5. The average share price stood at Rs.5.
The debutant share contributed Rs.374 million to the day’s turnover whilst 74.7 million shares changed hands. It was evident that the initial investors and private placement parties also disposed some of their shares on the first day of trading.
BIL offered 50 million shares to the public at Rs.5 per share to raise Rs.250 million. Before that, 830 million shares were issued to private parties at the same price in February this year.
source - www.dailymirror.lk
Tea Small Holders’ profits down 141%
Tea Small Holder Factories PLC (TSML), a unit of John Keells Group that purchases green leaf tea from the smallholders has reported a net loss of Rs.9.17 million as at 30 June 2011, compared to a profit of Rs.22.49 million a year ago.
The latest quarterly financial of the company also outlined that the company’s net profit had fallen 141% whilst Gross profit had come down by 97% to Rs.1.71 million compared Rs.51.83 million. The company’s revenue had also dipped 13% from Rs.582.78 million to Rs.505.95 million in June 2011. Subsequently, the Loss Per Share (LPS)has reported 31 cents compared 75 cents Earnings per Share a year ago.
The company’s revenue from Tea in Galle, Matara, Ratnapura and Nuwara Eliya districts had also dipped considerably according to the financials.
source - www.dailymirror.lk
The latest quarterly financial of the company also outlined that the company’s net profit had fallen 141% whilst Gross profit had come down by 97% to Rs.1.71 million compared Rs.51.83 million. The company’s revenue had also dipped 13% from Rs.582.78 million to Rs.505.95 million in June 2011. Subsequently, the Loss Per Share (LPS)has reported 31 cents compared 75 cents Earnings per Share a year ago.
The company’s revenue from Tea in Galle, Matara, Ratnapura and Nuwara Eliya districts had also dipped considerably according to the financials.
source - www.dailymirror.lk
Palm oil slips lower as concerns over US debt weigh on markets
Kuala Lumpur. Malaysian palm oil futures dropped on Monday as traders booked profit after pricing in firm exports and eyed growing concerns of a US debt default that might slow global economic growth and demand.
The palm oil market has been choppy in the past few days and could come under more pressure due to mounting worries about US debt.
The market has lost more than 18 percent so far this year on higher production in top suppliers Indonesia and Malaysia.
“There has been some selling pressure in commodity markets but not in a panic-stricken way as yet. Good exports should hold the palm oil market up temporarily,” said a trader with a foreign commodities brokerage. “Market players said that the weather is bringing bad yields, therefore production in July is down slightly,” said a trader in Kuala Lumpur.
The benchmark October crude palm oil contract KPOc3 on Bursa Malaysia Derivatives had fallen 1.3 percent, or 40 ringgit, to 3,100 ringgit ($1,042) per ton. Overall traded volume rose to 27,685 lots of 25 tons each from the usual 25,000 lots.
Cargo surveyor Intertek Testing Services signaled firmer demand for Malaysian palm oil, with data showing exports for July 1-25 rising 2.3 percent to 1.28 million tons from the same period a month ago.
Another surveyor, Societe Generale de Surveillance also showed exports up 5.7 percent during July 1-20. Robust demand comes as some traders and planters expect production next month to start slowing as mostly Muslim estate workers take leave for Ramadan, which starts in August. Grains and crude oil also fell on Monday over the prospect of a US debt default, adding pressure to the price of vegetable oils crushed from soybeans and also used in competing biodiesel.
Also, forecasts for rain this week in the heat-stricken US Midwest added to the selling momentum. US soy oil for August delivery BOc1 fell 0.8 percent in Asian trade hours.
source - www.dailymirror.lk
The palm oil market has been choppy in the past few days and could come under more pressure due to mounting worries about US debt.
The market has lost more than 18 percent so far this year on higher production in top suppliers Indonesia and Malaysia.
“There has been some selling pressure in commodity markets but not in a panic-stricken way as yet. Good exports should hold the palm oil market up temporarily,” said a trader with a foreign commodities brokerage. “Market players said that the weather is bringing bad yields, therefore production in July is down slightly,” said a trader in Kuala Lumpur.
The benchmark October crude palm oil contract KPOc3 on Bursa Malaysia Derivatives had fallen 1.3 percent, or 40 ringgit, to 3,100 ringgit ($1,042) per ton. Overall traded volume rose to 27,685 lots of 25 tons each from the usual 25,000 lots.
Cargo surveyor Intertek Testing Services signaled firmer demand for Malaysian palm oil, with data showing exports for July 1-25 rising 2.3 percent to 1.28 million tons from the same period a month ago.
Another surveyor, Societe Generale de Surveillance also showed exports up 5.7 percent during July 1-20. Robust demand comes as some traders and planters expect production next month to start slowing as mostly Muslim estate workers take leave for Ramadan, which starts in August. Grains and crude oil also fell on Monday over the prospect of a US debt default, adding pressure to the price of vegetable oils crushed from soybeans and also used in competing biodiesel.
Also, forecasts for rain this week in the heat-stricken US Midwest added to the selling momentum. US soy oil for August delivery BOc1 fell 0.8 percent in Asian trade hours.
source - www.dailymirror.lk
Natural rubber continues to demonstrate elasticity
Natural rubber (NR) price was rising steadily from the beginning of the year and touched US$ 6 mark, and this upward trend continued until mid-June. This provided lot of enthusiasm and excitement to growers while the consumers, mainly tyre companies that account for a major share of the global NR consumption, were distraught. The consuming industry was concerned and was exploring ways and means to somehow keep their margins intact in the face of the growing demand-supply gap in NR.
Although prices at both the global and domestic markets have now stabilized at a lower level, in the region of US$ 4.00 to 4.60 (Please see figures 1&2), yet there are many issues that are of concern to the rubber world.
Issues
Some of the issues that are before the global rubber industry are: Will the 15% growth rate in global rubber consumption since last year continue this year and beyond? Will the Chinese demand which has been showing signs of slowdown pick up later this year? Will the SR share in global rubber consumption go up significantly in the near future? Will the NR prices stabilize at the present level and if so, how long? And Will there be another global recession and if so will it affect the NR industry?
Market experts say that, demand-supply gap will only widen in the near future. They also point out that the higher prices of NR may not serve as a catalyst for a production boom in major NR producing countries if the ongoing pace of replanting and new planting in these countries is likely to be maintained in the future.
The auto boom in the Asian region especially in China and India is still alive despite a slight fall in China recently. While major tyre makers such as Bridgestone were active buyers, China’s purchases of NR in the physical market have subsided since at least March 2011 because of a slowdown in the country’s auto market. But the latest reports indicate that demand has already started signs of bouncing back in China.
Meanwhile, fears of yet another recession are hovering over the already battered major economies of the US and Europe. However, it will not be intensive enough to upset the growing demand for NR especially as the replacement market would certainly remain strong in any case. The current slight fall in crude prices will also not make any significant change in the SR-NR consumption ratio in the long term, say experts.
NR production
Total production of NR from all member- nations of the ANRPC was expected to grow only at 5.8% annual rate during the second quarter (April-June) of this year. The growth for the second quarter, as forecasted a few months ago, was 10.5% .Thailand, Indonesia, Malaysia, India, Vietnam, China, Sri Lanka, Philippines and Cambodia together account for 92% of the commodity’s global supply.
Meanwhile, the output growth during the full year 2011 now stands revised down further to 4.9% from 5.8% forecasted a few months ago and 6.4% growth attained during the previous year . The new revision results from a down-scaling of Indonesia’s anticipated production for the year to 2.891 million tonnes from 2.972 million tonnes expected a month before. Philippines also has downscaled the output anticipated for this year to 107,000 tonnes from its earlier forecast of 114,000 tonnes.
The ANRPC expects an additional supply of 1.13 million tonnes coming into the international market in 2012. This assumption is based on the fact that about 2.55m hectares would be opened for tapping from 2012-2017. This is equivalent to 36% of the yielding area of the ANRPC-member countries.
An analysis by the IRSG indicates that global rubber demand is likely to reach 25.5 million tonnes in 2011. It forecasts NR output of 10.2 million tonnes in 2010, rising to 15.4 million tonnes in 2020.
India is another major consumer of rubber and, with a good economic growth the demand will be only going up. Rubber consumption would climb to 1.89 million tonnes in 2020, compared with 930,000 tonnes in 2010, according to the latest reports.
The quantum of India’s annual rubber consumption was almost equally split between the tyre and non-tyre industries till a few years ago. But the tyre sector’s demand for rubber is likely to be two-thirds in the near future on account of the growth in automobile sector. The high rubber demand across all segments has also led to increasing deficit The deficit is expected to expand further from 189,000 tonnes now to 840,000 tonnes in 2020.
Bridging the gap
With a view to bridging the widening gap between demand and supply, some countries have started experimenting genetically modified (GM) NR cultivation. India has planed investigations on GM rubber. The industry is of the opinion that such initiatives are absolutely essential to meet the country’s future NR demand.
China has also gone all-out to support the domestic industry by buying rubber plantations in Africa, Thailand, Vietnam and Indonesia to ensure increased supplies of rubber. India is also vigorously extending plantations into some of its non-traditional areas, especially in the Northeastern States. About 100,000 hectares have been identified for this purpose, which would be in addition to the existing 50,000 hectares and Sri Lanka another 40,000 ha in the Low country Intermediate Zone. However, such initiatives may not be sufficient to meet the projected NR demand.
Meanwhile, the NR industry doesn’t anticipate a significant drop in NR use following new tyre-making technologies, including new compounding. So far, experts do not yet foresee a significant drop in NR use.
There are no developments on the SR side which would have considerable impact on the NR market.
A frequently mentioned subject, Guayule, is being mentioned again as NR substitute, but it is produced only on a small-scale and the industry experts do not yet foresee large-scale production, although very high NR prices will definitely stimulate such moves .
Malaysia
It is reported that Rubber production in Malaysia, the world’s third-largest grower and exporter, may expand 6.5% as higher prices encourage farmers to boost tapping. Output may increase to one million tonnes this year, from 939,000 million in 2010.If the price continues to remain this strong, then smallholders may continue tapping. They are expected to tap when they need money or when it is very lucrative for them to tap output from Malaysia, which represents about 10% of global supply, is to go up significantly in the coming years, according to Malaysian Rubber Board. Old trees will be replaced with higher-yielding clones and better technology is being used to increase output under a Government development plan.
The country plans to increase plantation areas by 30,000 hectares a year over the next five years. The Southeast Asian nation currently has about 1 million hectares of rubber, of which 650,000 hectares are being tapped. The rest are unattended or too old. The country’s exports are forecast to rise to 930,000 tonnes this year, the highest since 2007, according to the Board. The country exported 901,000 tonnes last year, with almost 40% going to China. Thailand Rains may have reduced Thai rubber output by 30,000 tonnes in the second quarter. Reduced production from Thailand, which accounts for 30% of global supply, would potentially increase costs for tyre makers like Bridgestone Corp, Michelin and Goodyear Tire & Rubber Co
Synthetic rubber
The current rubber trends are boosting the prices of styrene butadiene rubber (SBR),which is widely used in tyre. Its demand is outstripping supplies, fuelled by downstream tyre makers stepping up SBR use because of the more expensive NR. However, a quick addition of SBR in order to reduce NR content is not feasible as switching to a new combination in the compounding process takes time.
However, demand for SBR in India is steadily going up. The world’s top synthetic rubber producer Lanxess has said it sees a big jump in SR consumption driven by high demand, particularly by manufacturers of radial tyres.
According to reports, crude oil market sharply fell from the beginning of May. Europe brent oil price fell from $127 per barrel on May 2 to $109 per barrel on May 17. WTI oil price fell during the same period from $113 per barrel to $96 per barrel. It has also been reported that NR market sharply fell during the downward phase of crude oil prices although NR has not fallen to the extent of the fall in oil prices. This could have been due to positive influences on NR market exerted by the slowdown in NR supply and the favourable trend by Japanese yen.
Tyre industry
Tight supplies and consequent higher prices of NR have woken up many a tyre maker to venture into planting rubber in a major way. Machelin owns rubber plantations in Brazil, Bridgestone and Firestone in Liberia and Ghana and Goodyear in Indonesia. They are pioneers in the field.
Of late, some of the Indian tyre majors are also planning to follow suit. They include Apollo and JK Tyre.
Apollo is reportedly exploring possibility of a plantation venture in Laos and Combodia. India’s Automotive Tyre Manufacturers Association (ATMA) has had an exploratory visit to Africa for the purpose. RPG group’s Harrisons Malayalam is also scouting for some areas for rubber cultivation abroad.
Experts commenting on Indian tyre companies’ plans to venture into rubber cultivation say that it is a different kind of game and it may not be viable for the plantation business to subsidize a tyre company’s tyre business.
Though some companies produces rubber, they are not selling the same to their associate companies engaged in the tyre business.
source - www.dailymirror.lk
Although prices at both the global and domestic markets have now stabilized at a lower level, in the region of US$ 4.00 to 4.60 (Please see figures 1&2), yet there are many issues that are of concern to the rubber world.
Issues
Some of the issues that are before the global rubber industry are: Will the 15% growth rate in global rubber consumption since last year continue this year and beyond? Will the Chinese demand which has been showing signs of slowdown pick up later this year? Will the SR share in global rubber consumption go up significantly in the near future? Will the NR prices stabilize at the present level and if so, how long? And Will there be another global recession and if so will it affect the NR industry?
Market experts say that, demand-supply gap will only widen in the near future. They also point out that the higher prices of NR may not serve as a catalyst for a production boom in major NR producing countries if the ongoing pace of replanting and new planting in these countries is likely to be maintained in the future.
The auto boom in the Asian region especially in China and India is still alive despite a slight fall in China recently. While major tyre makers such as Bridgestone were active buyers, China’s purchases of NR in the physical market have subsided since at least March 2011 because of a slowdown in the country’s auto market. But the latest reports indicate that demand has already started signs of bouncing back in China.
Meanwhile, fears of yet another recession are hovering over the already battered major economies of the US and Europe. However, it will not be intensive enough to upset the growing demand for NR especially as the replacement market would certainly remain strong in any case. The current slight fall in crude prices will also not make any significant change in the SR-NR consumption ratio in the long term, say experts.
NR production
Total production of NR from all member- nations of the ANRPC was expected to grow only at 5.8% annual rate during the second quarter (April-June) of this year. The growth for the second quarter, as forecasted a few months ago, was 10.5% .Thailand, Indonesia, Malaysia, India, Vietnam, China, Sri Lanka, Philippines and Cambodia together account for 92% of the commodity’s global supply.
Meanwhile, the output growth during the full year 2011 now stands revised down further to 4.9% from 5.8% forecasted a few months ago and 6.4% growth attained during the previous year . The new revision results from a down-scaling of Indonesia’s anticipated production for the year to 2.891 million tonnes from 2.972 million tonnes expected a month before. Philippines also has downscaled the output anticipated for this year to 107,000 tonnes from its earlier forecast of 114,000 tonnes.
The ANRPC expects an additional supply of 1.13 million tonnes coming into the international market in 2012. This assumption is based on the fact that about 2.55m hectares would be opened for tapping from 2012-2017. This is equivalent to 36% of the yielding area of the ANRPC-member countries.
An analysis by the IRSG indicates that global rubber demand is likely to reach 25.5 million tonnes in 2011. It forecasts NR output of 10.2 million tonnes in 2010, rising to 15.4 million tonnes in 2020.
India is another major consumer of rubber and, with a good economic growth the demand will be only going up. Rubber consumption would climb to 1.89 million tonnes in 2020, compared with 930,000 tonnes in 2010, according to the latest reports.
The quantum of India’s annual rubber consumption was almost equally split between the tyre and non-tyre industries till a few years ago. But the tyre sector’s demand for rubber is likely to be two-thirds in the near future on account of the growth in automobile sector. The high rubber demand across all segments has also led to increasing deficit The deficit is expected to expand further from 189,000 tonnes now to 840,000 tonnes in 2020.
Bridging the gap
With a view to bridging the widening gap between demand and supply, some countries have started experimenting genetically modified (GM) NR cultivation. India has planed investigations on GM rubber. The industry is of the opinion that such initiatives are absolutely essential to meet the country’s future NR demand.
China has also gone all-out to support the domestic industry by buying rubber plantations in Africa, Thailand, Vietnam and Indonesia to ensure increased supplies of rubber. India is also vigorously extending plantations into some of its non-traditional areas, especially in the Northeastern States. About 100,000 hectares have been identified for this purpose, which would be in addition to the existing 50,000 hectares and Sri Lanka another 40,000 ha in the Low country Intermediate Zone. However, such initiatives may not be sufficient to meet the projected NR demand.
Meanwhile, the NR industry doesn’t anticipate a significant drop in NR use following new tyre-making technologies, including new compounding. So far, experts do not yet foresee a significant drop in NR use.
There are no developments on the SR side which would have considerable impact on the NR market.
A frequently mentioned subject, Guayule, is being mentioned again as NR substitute, but it is produced only on a small-scale and the industry experts do not yet foresee large-scale production, although very high NR prices will definitely stimulate such moves .
Malaysia
It is reported that Rubber production in Malaysia, the world’s third-largest grower and exporter, may expand 6.5% as higher prices encourage farmers to boost tapping. Output may increase to one million tonnes this year, from 939,000 million in 2010.If the price continues to remain this strong, then smallholders may continue tapping. They are expected to tap when they need money or when it is very lucrative for them to tap output from Malaysia, which represents about 10% of global supply, is to go up significantly in the coming years, according to Malaysian Rubber Board. Old trees will be replaced with higher-yielding clones and better technology is being used to increase output under a Government development plan.
The country plans to increase plantation areas by 30,000 hectares a year over the next five years. The Southeast Asian nation currently has about 1 million hectares of rubber, of which 650,000 hectares are being tapped. The rest are unattended or too old. The country’s exports are forecast to rise to 930,000 tonnes this year, the highest since 2007, according to the Board. The country exported 901,000 tonnes last year, with almost 40% going to China. Thailand Rains may have reduced Thai rubber output by 30,000 tonnes in the second quarter. Reduced production from Thailand, which accounts for 30% of global supply, would potentially increase costs for tyre makers like Bridgestone Corp, Michelin and Goodyear Tire & Rubber Co
Synthetic rubber
The current rubber trends are boosting the prices of styrene butadiene rubber (SBR),which is widely used in tyre. Its demand is outstripping supplies, fuelled by downstream tyre makers stepping up SBR use because of the more expensive NR. However, a quick addition of SBR in order to reduce NR content is not feasible as switching to a new combination in the compounding process takes time.
However, demand for SBR in India is steadily going up. The world’s top synthetic rubber producer Lanxess has said it sees a big jump in SR consumption driven by high demand, particularly by manufacturers of radial tyres.
According to reports, crude oil market sharply fell from the beginning of May. Europe brent oil price fell from $127 per barrel on May 2 to $109 per barrel on May 17. WTI oil price fell during the same period from $113 per barrel to $96 per barrel. It has also been reported that NR market sharply fell during the downward phase of crude oil prices although NR has not fallen to the extent of the fall in oil prices. This could have been due to positive influences on NR market exerted by the slowdown in NR supply and the favourable trend by Japanese yen.
Tyre industry
Tight supplies and consequent higher prices of NR have woken up many a tyre maker to venture into planting rubber in a major way. Machelin owns rubber plantations in Brazil, Bridgestone and Firestone in Liberia and Ghana and Goodyear in Indonesia. They are pioneers in the field.
Of late, some of the Indian tyre majors are also planning to follow suit. They include Apollo and JK Tyre.
Apollo is reportedly exploring possibility of a plantation venture in Laos and Combodia. India’s Automotive Tyre Manufacturers Association (ATMA) has had an exploratory visit to Africa for the purpose. RPG group’s Harrisons Malayalam is also scouting for some areas for rubber cultivation abroad.
Experts commenting on Indian tyre companies’ plans to venture into rubber cultivation say that it is a different kind of game and it may not be viable for the plantation business to subsidize a tyre company’s tyre business.
Though some companies produces rubber, they are not selling the same to their associate companies engaged in the tyre business.
source - www.dailymirror.lk
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