* Bourse falls on low volume and turnover
* Foreign inflow at 34.3 mln rupees
* Rupee steady; cbank pumps in $28 mln to defend
COLOMBO, Jan 31 (Reuters) - Sri Lanka's share market closed weaker on Tuesday, ending a four-session rally as investors booked profits in financial and blue chip shares amid low volumes and turnover, dealers said.
The main share index ended 1.07 percent or 61.64 points weaker at 5,693.92, from its highest since Jan. 23.
Analysts said institutional investors are worried about a possible rise in interest rates, depreciation in the rupee and Sri Lanka turning down the remaining $800 million in disbursements remaining from a $2.6 billion International Monetary Fund loan.
Conglomerate John Keells Holdings PLC fell 0.14 percent to 169.30 rupees, On Thursday it posted a 56 percent gain in its December quarter earnings.
Shares in Commercial Bank of Ceylon fell 0.66 percent to 104.70 rupees.
Sri Lanka's bourse is the worst performer among Asian markets with a 6.26 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.
Foreign investors were net buyers of 34.3 million Sri Lankan rupees on Monday, extending the net foreign buying to 471.5 million rupees worth of shares so far this year, after net outflows of 19.1 billion last year.
The day's turnover was 831 million Sri Lanka rupees ($7.30 million), lowest since Jan. 25 and well below last year's average of 2.3 billion. Volume was 34.3 million shares. Last year's daily average was a record 102.7 million.
Government data released after the market closed showed that annual inflation slowed to a 26-month low of 3.8 percent in January from a year earlier.
The rupee closed flat at 113.89/90 against the dollar for the 47th straight session since a Nov. 21 devaluation, with the central bank selling more than $28 million to defend it, dealers said.
The bank has spent more than $1.11 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay. ($1 = 113.9000 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)
source - www.reuters.com
Tuesday, January 31, 2012
Sri Lanka lifts ban on tea estates harvesting timber
n 31, 2012 (LBO) - A Sri Lanka state decision to allow commercial timber to be harvested will increase the supply of fuel wood for use in tea driers helping cut production costs, an industry body representing private managers said.
"We are confident this decision by the government will benefit not only the estate sector but the country as a whole, Lalith Obeyesekere, chairman of the Planters Association, which represents private managers said in a statement.
Plantations industries minister Mahinda Samarasinghe had intervened to lift the ban he said.
Sri Lanka's so-called regional plantation companies (RPCs) formerly state-run tea and rubber plantation now leased to the private firms, come under various state restrictions.
The plantations, originally grown by mainly British farmers, were expropriated in the 1970s and driven to losses by the state two decades later.
In 1990s most were given back to private firms after the taxes collected from the people had to be pumped into the firms to meet their salary bills every month.
Under private management many firms converted tea dryers which earlier ran on furnace oil to run to fuelwood, when commodity prices rose as loose US monetary policy pushed up commodity prices from 2001.
"The use of fuel wood is expected to reduce both RPC operating costs and also the country’s oil import bill, at a time when oil prices are rising," the Planters Association, a body representing private managers said.
"Timber harvesting will also provide RPCs with an alternate source of income. This is seen as particularly important as many RPCs are facing financial difficulties due to volatile tea prices and increasing production costs."
But greater use of fuelwood also drove up their prices.
The PA said plantation companies forestry programs are approved by Sri Lanka's Conservator of Forests and prior to harvesting timber tracts are inspected by the Forest Department, Central Environmental Authority and the plantations ministry.
The planters said timber harvested from their plantations was also used for construction and furniture production.
source - www.lbo.lk
"We are confident this decision by the government will benefit not only the estate sector but the country as a whole, Lalith Obeyesekere, chairman of the Planters Association, which represents private managers said in a statement.
Plantations industries minister Mahinda Samarasinghe had intervened to lift the ban he said.
Sri Lanka's so-called regional plantation companies (RPCs) formerly state-run tea and rubber plantation now leased to the private firms, come under various state restrictions.
The plantations, originally grown by mainly British farmers, were expropriated in the 1970s and driven to losses by the state two decades later.
In 1990s most were given back to private firms after the taxes collected from the people had to be pumped into the firms to meet their salary bills every month.
Under private management many firms converted tea dryers which earlier ran on furnace oil to run to fuelwood, when commodity prices rose as loose US monetary policy pushed up commodity prices from 2001.
"The use of fuel wood is expected to reduce both RPC operating costs and also the country’s oil import bill, at a time when oil prices are rising," the Planters Association, a body representing private managers said.
"Timber harvesting will also provide RPCs with an alternate source of income. This is seen as particularly important as many RPCs are facing financial difficulties due to volatile tea prices and increasing production costs."
But greater use of fuelwood also drove up their prices.
The PA said plantation companies forestry programs are approved by Sri Lanka's Conservator of Forests and prior to harvesting timber tracts are inspected by the Forest Department, Central Environmental Authority and the plantations ministry.
The planters said timber harvested from their plantations was also used for construction and furniture production.
source - www.lbo.lk
Bourse sustains mild rally
The Colombo bourse sustained its mild rally on Monday with both indices closing in positive territory led by interest in banking stocks, despite a slump driven by profit taking, brokers said.
The All Share Price Index closed 0.53 percent higher on 5,755.56 points, gaining 30.12 points on Monday. The index opened the week at nearly 100 points higher from last Friday’s closing. The Milanka Price Index of more liquid stocks closed 1.11 percent higher, gaining 54.4 points to close at 4,976.21 points.
Turnover amounted to Rs. 1.4 billion on a volume of nearly 46 million shares changing hands during the day. Around 100 counters closed in positive territory against 101 counters that closed in the red.
"The market managed to sustain the positive run from last week as the bourse started on an aggressive note although losing momentum half way through due to profit taking witnessed across the board.
The banking sector continued its dominance with NDB and Commercial Bank attracting both high net worth and institutional interest. Despite the persistent interest in fundamentally sound counters, heavy activity was seen in several retail favourite stocks,"NDB Stockbrokers said.
NDB Bank’s share price edged up by Rs 3.70 (3.00%) to close at Rs 127.00. Both Commercial Bank Voting and Non Voting gained by 1.34% and 6.38% respectively to close at Rs 106.00 and Rs 90.00.
NDB featured in a crossing involving a parcel of 2.84 million shares at Rs. 112.50 each, generating a turnover Rs. 347.7 million. A parcel of 944 thousand Union Bank shares changed hands at Rs. 21.5 each.
Despite the positive gains made over the past few days, the Colombo Stock Exchange was still down 5.25 percent year-to-date on Monday.
Foreign purchases amounted to Rs. 101.2 million against foreign sales amounting to Rs. 415.2 million.
source - www.island.lk
The All Share Price Index closed 0.53 percent higher on 5,755.56 points, gaining 30.12 points on Monday. The index opened the week at nearly 100 points higher from last Friday’s closing. The Milanka Price Index of more liquid stocks closed 1.11 percent higher, gaining 54.4 points to close at 4,976.21 points.
Turnover amounted to Rs. 1.4 billion on a volume of nearly 46 million shares changing hands during the day. Around 100 counters closed in positive territory against 101 counters that closed in the red.
"The market managed to sustain the positive run from last week as the bourse started on an aggressive note although losing momentum half way through due to profit taking witnessed across the board.
The banking sector continued its dominance with NDB and Commercial Bank attracting both high net worth and institutional interest. Despite the persistent interest in fundamentally sound counters, heavy activity was seen in several retail favourite stocks,"NDB Stockbrokers said.
NDB Bank’s share price edged up by Rs 3.70 (3.00%) to close at Rs 127.00. Both Commercial Bank Voting and Non Voting gained by 1.34% and 6.38% respectively to close at Rs 106.00 and Rs 90.00.
NDB featured in a crossing involving a parcel of 2.84 million shares at Rs. 112.50 each, generating a turnover Rs. 347.7 million. A parcel of 944 thousand Union Bank shares changed hands at Rs. 21.5 each.
Despite the positive gains made over the past few days, the Colombo Stock Exchange was still down 5.25 percent year-to-date on Monday.
Foreign purchases amounted to Rs. 101.2 million against foreign sales amounting to Rs. 415.2 million.
source - www.island.lk
Monday, January 30, 2012
SL among Kuoni’s top five destinations
Sri Lanka has been named among the top five destinations in Kuoni’s annual poll of where UK customers want to spend their holidays. Sri Lanka also retained the number one destination for weddings according to the report.
Where holidaymakers want to go is just part of leading tour operator Kuoni’s annual Travel Trends Report. The 20-page report also tracks hot travel trends and the top destinations for weddings and honeymoons, for families, for solo travellers, for pampering spa holidays, for the most exciting adventures and authentic experiences as well as the best destinations for those that care about the planet.
The report also highlights changes in holiday behaviour and includes trends in holiday booking behaviour, such as the importance of social media in driving holiday choices.
Sri Lanka retained number one destination for weddings, Kuramathi Island Resort in the Maldives kept the top slot for family destinations, as did Thailand for solo holidays.
The winner of the Top 10 adventure holiday is the 11-day tour of culture-rich Sri Lanka on the Ceylon Tour, while those looking for the best Planet Friendly Holiday voted for Governors Main Camp in the wildlife safari heaven of Kenya.
The Report’s 2012 figures are based on holiday bookings made as at December 2011.
Kuoni has been undertaking the annual Travel Trends Report since 1980.
Recently National Geographic and Condé Nast Traveller also named Sri Lanka among ‘Best Trips for 2012.
source - www.iewy.com
Where holidaymakers want to go is just part of leading tour operator Kuoni’s annual Travel Trends Report. The 20-page report also tracks hot travel trends and the top destinations for weddings and honeymoons, for families, for solo travellers, for pampering spa holidays, for the most exciting adventures and authentic experiences as well as the best destinations for those that care about the planet.
The report also highlights changes in holiday behaviour and includes trends in holiday booking behaviour, such as the importance of social media in driving holiday choices.
Sri Lanka retained number one destination for weddings, Kuramathi Island Resort in the Maldives kept the top slot for family destinations, as did Thailand for solo holidays.
The winner of the Top 10 adventure holiday is the 11-day tour of culture-rich Sri Lanka on the Ceylon Tour, while those looking for the best Planet Friendly Holiday voted for Governors Main Camp in the wildlife safari heaven of Kenya.
The Report’s 2012 figures are based on holiday bookings made as at December 2011.
Kuoni has been undertaking the annual Travel Trends Report since 1980.
Recently National Geographic and Condé Nast Traveller also named Sri Lanka among ‘Best Trips for 2012.
source - www.iewy.com
Sri Lanka bourse up on earning hopes; banks lead
* Market erase early gains amid IMF, rates concerns
* Foreign outflow at 314 mln rupees
* Rupee steady; cbank pumps in $12 mln to defend
COLOMBO, Jan 30 (Reuters) - Sri Lanka's share market closed firmer on Monday extending its positive momentum as investors snapped up financials and blue chips on better earning hopes after the market heavyweight and bellwether John Keells Holdings posted strong earnings.
The main share index ended 0.53 percent or 30.12 points at 5,755.56, its highest since Jan. 23, after retreating from a early gain of 1.78 percent.
Analysts said institutional investors are still on the sideline due to concerns over a possible rise in interest rates, depreciation in the rupee and Sri Lanka turning down the IMF's remaining $800 million of a $2.6 billion loan.
Keells gained 1.25 percent to 170 rupees, On Thursday it posted a 56 percent gain in its December quarter earnings.
Banking shares led the gain with Sampath Bank PLC gaining 6.66 percent to 190.50 rupees, while Hatton National Bank PLC rising 3.95 percent to 150.10 rupees.
Shares in Commercial Bank of Ceylon rose 1.35 percent to 105.40 rupees.
Sri Lanka's bourse is still the worst performer among Asian markets with a 5.25 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.
Net foreign share sales on Monday were 314 million Sri Lankan rupees, but offshore investors are net buyers of 437.2 million rupees worth of shares so far this year, after a net outflows of 19.1 billion last year.
The day's turnover was 1.41 billion rupees ($12.39 million), less than last year's average of 2.3 billion. Volume was 46 million shares. Last year's daily average was a record 102.7 million.
The rupee closed flat at 113.89/90 against the dollar for a 46th straight session since a Nov. 21 devaluation with the central bank selling around $12 million to defend it, dealers said.
The bank has spent more than $1.08 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay.
($1 = 113.8350 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Ed Lane)
source - www.reuters.com
* Foreign outflow at 314 mln rupees
* Rupee steady; cbank pumps in $12 mln to defend
COLOMBO, Jan 30 (Reuters) - Sri Lanka's share market closed firmer on Monday extending its positive momentum as investors snapped up financials and blue chips on better earning hopes after the market heavyweight and bellwether John Keells Holdings posted strong earnings.
The main share index ended 0.53 percent or 30.12 points at 5,755.56, its highest since Jan. 23, after retreating from a early gain of 1.78 percent.
Analysts said institutional investors are still on the sideline due to concerns over a possible rise in interest rates, depreciation in the rupee and Sri Lanka turning down the IMF's remaining $800 million of a $2.6 billion loan.
Keells gained 1.25 percent to 170 rupees, On Thursday it posted a 56 percent gain in its December quarter earnings.
Banking shares led the gain with Sampath Bank PLC gaining 6.66 percent to 190.50 rupees, while Hatton National Bank PLC rising 3.95 percent to 150.10 rupees.
Shares in Commercial Bank of Ceylon rose 1.35 percent to 105.40 rupees.
Sri Lanka's bourse is still the worst performer among Asian markets with a 5.25 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.
Net foreign share sales on Monday were 314 million Sri Lankan rupees, but offshore investors are net buyers of 437.2 million rupees worth of shares so far this year, after a net outflows of 19.1 billion last year.
The day's turnover was 1.41 billion rupees ($12.39 million), less than last year's average of 2.3 billion. Volume was 46 million shares. Last year's daily average was a record 102.7 million.
The rupee closed flat at 113.89/90 against the dollar for a 46th straight session since a Nov. 21 devaluation with the central bank selling around $12 million to defend it, dealers said.
The bank has spent more than $1.08 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay.
($1 = 113.8350 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Ed Lane)
source - www.reuters.com
Sunday, January 29, 2012
Big block blue chip trades infuses welcome oxygen to CSE
The Colombo bourse rallied last week as high net worth investors traded large blocks of blue chip shares boosting retail investor confidence, Acuity Stockbrokers said in a research report yesterday.
The All Share Price Index gained 133 points (2.38%) while the Milanka was up 163.35 points (3.43%) on Friday on top of a less spectacular gain of 36.11 points (0.65%) on the All Share and 21.53 points (0.45%) on the Milanka the previous day.
Acuity said that the rally had been led by the banking and finance and diversified sectors which contributed 78.2% on Friday’s market turnover.
"We expect the positive market sentiment to gather momentum in the week ahead, supported by strong fourth quarter corporate earnings," the report said.
The big trades on Thursday comprised sales of large blocks of John Keells Holdings (JKH) by Mr. Sohli Captain and connected parties to foreign shareholders.
The Captains, who remain the biggest shareholders of JKH, were buying into Commercial Bank which also saw substantial blocks being sold by foreign shareholders to local buyers.
JKH last week posted a strong third quarter result for the current financial year with group attributable profit after-tax up 55% to Rs.2.73 billion. It was up 46% to Rs.5.68 billion in the nine months ended September 30, 2011.
Both revenue and profitability were up substantially with group revenues for the first nine months up 28% to Rs.54.27 billion.
The September financials indicated that JKH had done best in the leisure and transportation segments with leisure earnings topping Rs.1 billion before-tax during the nine months under review and transportation earning Rs.879 million pre-tax.
Financial services too had done well earning Rs.605 pre-tax during the 9-month period while consumer food and retail earned Rs.532 million with all segments doing substantially better than during the comparative period the previous year.
source - www.island.lk
The All Share Price Index gained 133 points (2.38%) while the Milanka was up 163.35 points (3.43%) on Friday on top of a less spectacular gain of 36.11 points (0.65%) on the All Share and 21.53 points (0.45%) on the Milanka the previous day.
Acuity said that the rally had been led by the banking and finance and diversified sectors which contributed 78.2% on Friday’s market turnover.
"We expect the positive market sentiment to gather momentum in the week ahead, supported by strong fourth quarter corporate earnings," the report said.
The big trades on Thursday comprised sales of large blocks of John Keells Holdings (JKH) by Mr. Sohli Captain and connected parties to foreign shareholders.
The Captains, who remain the biggest shareholders of JKH, were buying into Commercial Bank which also saw substantial blocks being sold by foreign shareholders to local buyers.
JKH last week posted a strong third quarter result for the current financial year with group attributable profit after-tax up 55% to Rs.2.73 billion. It was up 46% to Rs.5.68 billion in the nine months ended September 30, 2011.
Both revenue and profitability were up substantially with group revenues for the first nine months up 28% to Rs.54.27 billion.
The September financials indicated that JKH had done best in the leisure and transportation segments with leisure earnings topping Rs.1 billion before-tax during the nine months under review and transportation earning Rs.879 million pre-tax.
Financial services too had done well earning Rs.605 pre-tax during the 9-month period while consumer food and retail earned Rs.532 million with all segments doing substantially better than during the comparative period the previous year.
source - www.island.lk
Saturday, January 28, 2012
HSBC to Tap Sri Lanka Corporate Demand for Global Debt Sales
By Anusha Ondaatjie
Jan. 27 (Bloomberg) -- HSBC Holdings Plc, Europe’s biggest bank, plans to expand sales of debt issued by Sri Lankan companies to investors abroad as the island’s resurgent economy boosts demand for financing.
The lender is targeting the country’s financial firms and the tourism industry with overseas dollar bonds and syndications, according to Nick Nicolaou, who heads HSBC’s Sri Lanka operations. The London-based bank is focusing on funds of three-year tenure or more, Nicolaou said, without naming specific companies.
“Given the large amount of infrastructural development and private sector investment, the sort of financing required is difficult to raise totally in the local market,” Nicolaou said in an interview in Colombo on Jan. 26. “Investors are looking at opportunities in emerging markets and, without a doubt, there is confidence in Sri Lanka.”
The island’s economy grew 8.4 percent in the quarter to Sept. 30 as the end of a 26-year civil war in 2009 spurs infrastructure spending and encourages tourism and consumer demand. Sri Lanka’s $1 billion sale of 10-year dollar bonds in July, co-arranged by HSBC, attracted bids for more than seven times the amount on offer and the central bank has encouraged local companies to follow its lead and tap overseas funds.
Foreign inflows this year will probably include $500 million of overseas borrowings by large domestic companies and $1 billion of subordinated debt raised by commercial banks to boost regulatory capital requirements, Central Bank Governor Ajith Nivard Cabraal said earlier this month.
The island’s $50 billion economy may expand 8 percent in 2012, compared with an estimated 8.3 percent in 2011, Cabraal said.
Sri Lanka’s $500 million of 8.25 percent five-year bonds are maturing in October, according to data compiled by Bloomberg. HSBC, which helped arrange four of the island’s sovereign issues since 2007, would vie for lead manager role if the debt was to be refinanced, Nicolaou said.
--Editors: Pavel Alpeyev, Andrew Monahan
source - www.businessweek.com
Jan. 27 (Bloomberg) -- HSBC Holdings Plc, Europe’s biggest bank, plans to expand sales of debt issued by Sri Lankan companies to investors abroad as the island’s resurgent economy boosts demand for financing.
The lender is targeting the country’s financial firms and the tourism industry with overseas dollar bonds and syndications, according to Nick Nicolaou, who heads HSBC’s Sri Lanka operations. The London-based bank is focusing on funds of three-year tenure or more, Nicolaou said, without naming specific companies.
“Given the large amount of infrastructural development and private sector investment, the sort of financing required is difficult to raise totally in the local market,” Nicolaou said in an interview in Colombo on Jan. 26. “Investors are looking at opportunities in emerging markets and, without a doubt, there is confidence in Sri Lanka.”
The island’s economy grew 8.4 percent in the quarter to Sept. 30 as the end of a 26-year civil war in 2009 spurs infrastructure spending and encourages tourism and consumer demand. Sri Lanka’s $1 billion sale of 10-year dollar bonds in July, co-arranged by HSBC, attracted bids for more than seven times the amount on offer and the central bank has encouraged local companies to follow its lead and tap overseas funds.
Foreign inflows this year will probably include $500 million of overseas borrowings by large domestic companies and $1 billion of subordinated debt raised by commercial banks to boost regulatory capital requirements, Central Bank Governor Ajith Nivard Cabraal said earlier this month.
The island’s $50 billion economy may expand 8 percent in 2012, compared with an estimated 8.3 percent in 2011, Cabraal said.
Sri Lanka’s $500 million of 8.25 percent five-year bonds are maturing in October, according to data compiled by Bloomberg. HSBC, which helped arrange four of the island’s sovereign issues since 2007, would vie for lead manager role if the debt was to be refinanced, Nicolaou said.
--Editors: Pavel Alpeyev, Andrew Monahan
source - www.businessweek.com
Brokers smile as bourse looks up on blue chips
* ComBank, JKH, Spence and banking stock attract interest
* Foreign buying helps market
The smiles came back in Colombo’s stock broking industry yesterday with the market distinctly looking up closing with turnover comfortably topping a billion rupees and both indices up sharply with many brokers and analysts attributing foreign buying into some blue chips triggering upward movement.
Turnover at Rs.1.72 billion was down from the previous day’s Rs.2.29 billion and the All Share Price Index up 133.04 points (2.38%) while the Milanka gained 163.35 points (3.43%) with 193 gainers leaving 20 losers trailing dismally behind.
"All are smiling today," a stockbroker from a leading brokerage said. "The market was helped by foreign buying which triggered interest."
Foreign buying was evident in JKH which closed Rs.4.50 up at Rs.167 on 0.7 million shares done between Rs.163.40 and Rs.169 generating a turnover of Rs.118.6 million which was number four on the turnover league.
The big business generator was Commercial Bank closing Rs.4 up at Rs.106 on nearly 3.5 million shares done between Rs.100.50 and Rs.106 contributing Rs.348.9 million to turnover.
Aitken Spence followed gaining Rs.3.50 to close at Rs.113 on two million shares done between Rs.108 and Rs.115 contributing Rs.350 million to turnover while NTB was up Rs.5 to close at Rs.62.50 on over 2.2 million shares done between Rs.55.90 and Rs.62.80.
Noting that blue chips moved on price and volume, a broker said that this was good for the market adding that institutions are still not active with state institutions yet absent.
Asia Asset Finance closed flat at Rs.7 on 14.8 million shares done between Rs.6.80 and Rs.7.50 with other speculative stocks likes Swarnamahal, ERI and Ceylinco Finance also showing volume and price gain.
Commercial Bank’s non-voting shares did better than the voting shares gaining Rs.7.20 to close at Rs.86 on a million shares traded between Rs.76 and Rs.86. Brokers explained that since the dividend yield was the same for the voting and non-voting shares, many investors preferred to buy the non-voting stock.
Other than ComBank and NTB, banking stocks that were active included Sampath up Rs.8.70 to Rs.179.90 on nearly 0.2 million shares done between Rs.174 and Rs.179.90, HNB up a rupee to close at Rs.145 on nearly 0.6 million shares done between Rs.141 and Rs.145.
Pan Asia too was up Rs.1.40 to Rs.25.50 on slightly over 0.3 million shares done between Rs.23.30 and Rs.25.50.
Union Bank was up 90 cents to close at Rs.20.50 on nearly 0.4 million shares and Seylan Bank (non-voting) up Rs.1.70 to Rs.29.70 on nearly 0.3 million shares traded between Rs.27.10 and Rs.29.70.
Dividend announcements for the day were by Royal Ceramics, a tax-free interim dividend of Rs.2 per share for 2011/12 XD from Feb. 8 and payment on Feb. 17; Alliance Finance an interim dividend of Rs.25 per share for 2011/12 XD from Feb. 8 and payment on Feb. 17; and Bairaha an interim dividend of Rs.2 per share for 2011/12 XD from Feb. 8 and payment on Feb. 21.
source - www.island.lk
* Foreign buying helps market
The smiles came back in Colombo’s stock broking industry yesterday with the market distinctly looking up closing with turnover comfortably topping a billion rupees and both indices up sharply with many brokers and analysts attributing foreign buying into some blue chips triggering upward movement.
Turnover at Rs.1.72 billion was down from the previous day’s Rs.2.29 billion and the All Share Price Index up 133.04 points (2.38%) while the Milanka gained 163.35 points (3.43%) with 193 gainers leaving 20 losers trailing dismally behind.
"All are smiling today," a stockbroker from a leading brokerage said. "The market was helped by foreign buying which triggered interest."
Foreign buying was evident in JKH which closed Rs.4.50 up at Rs.167 on 0.7 million shares done between Rs.163.40 and Rs.169 generating a turnover of Rs.118.6 million which was number four on the turnover league.
The big business generator was Commercial Bank closing Rs.4 up at Rs.106 on nearly 3.5 million shares done between Rs.100.50 and Rs.106 contributing Rs.348.9 million to turnover.
Aitken Spence followed gaining Rs.3.50 to close at Rs.113 on two million shares done between Rs.108 and Rs.115 contributing Rs.350 million to turnover while NTB was up Rs.5 to close at Rs.62.50 on over 2.2 million shares done between Rs.55.90 and Rs.62.80.
Noting that blue chips moved on price and volume, a broker said that this was good for the market adding that institutions are still not active with state institutions yet absent.
Asia Asset Finance closed flat at Rs.7 on 14.8 million shares done between Rs.6.80 and Rs.7.50 with other speculative stocks likes Swarnamahal, ERI and Ceylinco Finance also showing volume and price gain.
Commercial Bank’s non-voting shares did better than the voting shares gaining Rs.7.20 to close at Rs.86 on a million shares traded between Rs.76 and Rs.86. Brokers explained that since the dividend yield was the same for the voting and non-voting shares, many investors preferred to buy the non-voting stock.
Other than ComBank and NTB, banking stocks that were active included Sampath up Rs.8.70 to Rs.179.90 on nearly 0.2 million shares done between Rs.174 and Rs.179.90, HNB up a rupee to close at Rs.145 on nearly 0.6 million shares done between Rs.141 and Rs.145.
Pan Asia too was up Rs.1.40 to Rs.25.50 on slightly over 0.3 million shares done between Rs.23.30 and Rs.25.50.
Union Bank was up 90 cents to close at Rs.20.50 on nearly 0.4 million shares and Seylan Bank (non-voting) up Rs.1.70 to Rs.29.70 on nearly 0.3 million shares traded between Rs.27.10 and Rs.29.70.
Dividend announcements for the day were by Royal Ceramics, a tax-free interim dividend of Rs.2 per share for 2011/12 XD from Feb. 8 and payment on Feb. 17; Alliance Finance an interim dividend of Rs.25 per share for 2011/12 XD from Feb. 8 and payment on Feb. 17; and Bairaha an interim dividend of Rs.2 per share for 2011/12 XD from Feb. 8 and payment on Feb. 21.
source - www.island.lk
Friday, January 27, 2012
Sri Lanka stocks extend rally on banks, hotels
* Bourse poses highest daily pct gain since Nov. 28
* Foreign investor net sellers
* Rupee flat on light trade; cbank pumps $6 mln to defend
COLOMBO, Jan 27 (Reuters) - Sri Lanka's share market extended its rally with a more than 2 percent gain on Friday as investors snapped up risky assets after market heavyweight and bellwether John Keells Holdings CM> posted strong earnings.
The main share index rose 2.38 percent or 133.04 points to 5,725.44, highest since Jan. 23. It has risen 3.04 percent in last two sessions.
Foreign investors booked profits while local institutional investors bought blue chips like Commercial Bank of Ceylon , which rose 4.00 percent to 104 rupees on foreign selling of 2.2 million shares.
The island nation's bourse returned to neutral territory with the Relative Strength Index at 41.210 from Thursday's oversold region of 27.965, in between the lower neutral range of 30 and upper neutral range of 70, Reuters data showed.
But it is still the worst performer among Asian markets with a 5.75 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.
Net foreign sales on Friday were 157.3 million rupees, but offshore investors are net buyers of 751.2 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010.
Conglomerate Aitken Spence PLC rose 3.2 percent to 113 rupees, a day after it said that it would realise a capital gain of 630 million rupees on the sale of its 30 percent stake in Colombo harbour container terminal joint venture.
Keells gained 2.75 percent to 167.90 rupees, a day after it posted a 56 percent gain in its December quarter earnings.
The day's turnover was 1.61 billion Sri Lanka rupees ($14.13 million), less than last year's average of 2.3 billion. Volume was 59.1 million shares. Last year's daily average was a record 102.7 million.
The rupee closed flat at 113.89/90 to the dollar for a 45th straight session since a Nov. 21 devaluation with the central bank selling around $6 million to defend it, dealers said.
The bank has spent more than $1.07 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay. ($1 = 113.9050 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)
source - www.reuters.com
Snapshot for Sri Lanka Colombo Stock Exchange All Share Index (CSEALL) - By Bloomberg
* Foreign investor net sellers
* Rupee flat on light trade; cbank pumps $6 mln to defend
COLOMBO, Jan 27 (Reuters) - Sri Lanka's share market extended its rally with a more than 2 percent gain on Friday as investors snapped up risky assets after market heavyweight and bellwether John Keells Holdings CM> posted strong earnings.
The main share index rose 2.38 percent or 133.04 points to 5,725.44, highest since Jan. 23. It has risen 3.04 percent in last two sessions.
Foreign investors booked profits while local institutional investors bought blue chips like Commercial Bank of Ceylon , which rose 4.00 percent to 104 rupees on foreign selling of 2.2 million shares.
The island nation's bourse returned to neutral territory with the Relative Strength Index at 41.210 from Thursday's oversold region of 27.965, in between the lower neutral range of 30 and upper neutral range of 70, Reuters data showed.
But it is still the worst performer among Asian markets with a 5.75 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009 and 2010.
Net foreign sales on Friday were 157.3 million rupees, but offshore investors are net buyers of 751.2 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010.
Conglomerate Aitken Spence PLC rose 3.2 percent to 113 rupees, a day after it said that it would realise a capital gain of 630 million rupees on the sale of its 30 percent stake in Colombo harbour container terminal joint venture.
Keells gained 2.75 percent to 167.90 rupees, a day after it posted a 56 percent gain in its December quarter earnings.
The day's turnover was 1.61 billion Sri Lanka rupees ($14.13 million), less than last year's average of 2.3 billion. Volume was 59.1 million shares. Last year's daily average was a record 102.7 million.
The rupee closed flat at 113.89/90 to the dollar for a 45th straight session since a Nov. 21 devaluation with the central bank selling around $6 million to defend it, dealers said.
The bank has spent more than $1.07 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay. ($1 = 113.9050 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)
source - www.reuters.com
Snapshot for Sri Lanka Colombo Stock Exchange All Share Index (CSEALL) - By Bloomberg
Bourse basks in first-ever YTD net foreign inflow since 2009
Thanks to interest in premier blue chip John Keells Holdings (JKH), the Colombo stock market for the first time since end 2009 achieved a year-to-date (YTD) net foreign inflow.
Though 2012 is only 26 days old and the value is only Rs. 908 million, the net inflow on a ‘YTD basis’ is significant as it is happening after two years and midst negative run.
Analysts said that this development will further enhance investor sentiments, which appear to have got a fresh dose of energy during the past two market days, after the Bourse lost Rs. 90 billion (largely on account of forced selling on margin calls) in value early in the week.
As reported in the Daily FT yesterday, New World Securities (NWS) said that return of foreign interest (as reflected by Rs. 179 million net inflow on Tuesday and Rs. 66 million on Wednesday) lifted the Bourse. “This positive sentiment will remain if the foreigners continue to pick value stocks,” NWS added.
This was reality yesterday as several foreign funds picked up bulk of the 8.8 million shares of JKH that traded for Rs. 1.46 billion accounting for 64% of the turnover. Yesterday’s net foreign inflow was Rs. 1.02 billion, highest recorded since 3 May 2011.
“We take this as a very positive sign, given the fact that, fresh funds have to play a vital role for the bourse to mark a turnaround,” Arrenga Capital said.
It said: “The Colombo Bourse saw the long-awaited positive signal as foreign buying returned strongly; picking on the heavyweight John Keells Holdings, which has been trading near its 52-week low over the past few weeks.”
JKH saw nine off-market negotiated deals during the last hour of trading, at a fixed price of Rs. 167 per share (4.4% premium to the previous closing price). The crossings accumulated to around 7.9 million shares, whilst the counter registered another parcel of 294, 500k shares being crossed off at Rs. 160.0 during early trading hours.
JKH closed at Rs. 163.40, up by 2.1% whilst with stellar third quarter results released yesterday after the market was closed, investors are likely to toast the premier blue chip when the market resumes today (Friday).
Arrenga said these last hour deals in the counter lifted the market from its dull sentiments as the turnover crossed the Rs. 2 billion mark first time in two months.
Indices, which were struggling searching for a direction, shot up with the renewed foreign participation as both the ASPI and MPI closed advancing by 36.1 (0.6%) and 21.5 points (0.4%) at 5,592.4 and 4,758.5 points respectively. The YTD performance of ASI however remains a negative 7.94%, though lower in comparison to Tuesday’s near 9%.
Another heavyweight, Commercial Bank also continued with interest as the counter too registered three blocks totalling to 3.6 million shares being crossed off at a set price of Rs. 100 share, which represented nearly a 2.3% stake in the counter.
Arrenga said following the deals, considerable buying interest was evident in the counter, as it closed marginally in the green.
Speculative drive continued in two finance sector players, Asia Asset Finance and Swarnamahal Financial Services, as both depicted volatile behaviour. The former, after trading between the range of Rs. 6.7 to Rs. 7.1, closed at Rs. 7.1 with a 9.2% advance. The latter saw its price climbing up further as it closed at Rs. 119.6 with a 4% gain.
Following the announcement of a proposal to effect a reduction in its stated capital, Blue Diamonds [Voting & Non-Voting], both saw their prices gliding down closing with losses of 6.3% and 8.1% respectively. Interest was also seen in Environmental Resources Investments, Ceylon Leather Products, Nation Lanka Finance and Ascot Holdings.
source - www.ft.lk
Though 2012 is only 26 days old and the value is only Rs. 908 million, the net inflow on a ‘YTD basis’ is significant as it is happening after two years and midst negative run.
Analysts said that this development will further enhance investor sentiments, which appear to have got a fresh dose of energy during the past two market days, after the Bourse lost Rs. 90 billion (largely on account of forced selling on margin calls) in value early in the week.
As reported in the Daily FT yesterday, New World Securities (NWS) said that return of foreign interest (as reflected by Rs. 179 million net inflow on Tuesday and Rs. 66 million on Wednesday) lifted the Bourse. “This positive sentiment will remain if the foreigners continue to pick value stocks,” NWS added.
This was reality yesterday as several foreign funds picked up bulk of the 8.8 million shares of JKH that traded for Rs. 1.46 billion accounting for 64% of the turnover. Yesterday’s net foreign inflow was Rs. 1.02 billion, highest recorded since 3 May 2011.
“We take this as a very positive sign, given the fact that, fresh funds have to play a vital role for the bourse to mark a turnaround,” Arrenga Capital said.
It said: “The Colombo Bourse saw the long-awaited positive signal as foreign buying returned strongly; picking on the heavyweight John Keells Holdings, which has been trading near its 52-week low over the past few weeks.”
JKH saw nine off-market negotiated deals during the last hour of trading, at a fixed price of Rs. 167 per share (4.4% premium to the previous closing price). The crossings accumulated to around 7.9 million shares, whilst the counter registered another parcel of 294, 500k shares being crossed off at Rs. 160.0 during early trading hours.
JKH closed at Rs. 163.40, up by 2.1% whilst with stellar third quarter results released yesterday after the market was closed, investors are likely to toast the premier blue chip when the market resumes today (Friday).
Arrenga said these last hour deals in the counter lifted the market from its dull sentiments as the turnover crossed the Rs. 2 billion mark first time in two months.
Indices, which were struggling searching for a direction, shot up with the renewed foreign participation as both the ASPI and MPI closed advancing by 36.1 (0.6%) and 21.5 points (0.4%) at 5,592.4 and 4,758.5 points respectively. The YTD performance of ASI however remains a negative 7.94%, though lower in comparison to Tuesday’s near 9%.
Another heavyweight, Commercial Bank also continued with interest as the counter too registered three blocks totalling to 3.6 million shares being crossed off at a set price of Rs. 100 share, which represented nearly a 2.3% stake in the counter.
Arrenga said following the deals, considerable buying interest was evident in the counter, as it closed marginally in the green.
Speculative drive continued in two finance sector players, Asia Asset Finance and Swarnamahal Financial Services, as both depicted volatile behaviour. The former, after trading between the range of Rs. 6.7 to Rs. 7.1, closed at Rs. 7.1 with a 9.2% advance. The latter saw its price climbing up further as it closed at Rs. 119.6 with a 4% gain.
Following the announcement of a proposal to effect a reduction in its stated capital, Blue Diamonds [Voting & Non-Voting], both saw their prices gliding down closing with losses of 6.3% and 8.1% respectively. Interest was also seen in Environmental Resources Investments, Ceylon Leather Products, Nation Lanka Finance and Ascot Holdings.
source - www.ft.lk
Stellar 3Q for JKH
■Bottom line up 56% to Rs. 2.7 b; after tax profit tops Rs. 3 b with 49% growth; revenue higher by 35% to Rs. 21 b
■9-month after-tax profit up 2% to Rs. 6.25 b; revenue up 28% to Rs. 54.2 b
Premier blue chip John Keells Holdings (JKH) yesterday announced stellar results for its third quarter ended 31 December 2011, reflecting robust performance by all of its core sectors and continued momentum.
Group revenues of Rs. 21.14 billion and Rs. 54.27 billion in the 3Q and the first nine months of 2011/2012 were 35% and 28% above the corresponding periods in the previous year.
Group gross profits of Rs. 5.45 billion and Rs. 12.40 billion in the third quarter and the first nine months of 2011/2012 were 32% and 33% above the Rs. 4.12 billion and Rs. 9.35 billion recorded in the corresponding periods in the previous year.
The recurring Group profit before tax of Rs. 3.39 billion for the quarter and Rs. 7.39 billion for the first nine months of the financial year 2011/2012 grew by 44% and 33% respectively compared to Rs. 2.36 billion and Rs. 5.54 billion in the corresponding periods in the previous year, excluding the gains of Rs.1.79 billion from the sale of stakes in Asian Hotels and Properties PLC (AHPL) and John Keells Hotels PLC (KHL), JKH Chairman Susantha Ratnayake said in his review accompanying interim results.
Group PBT was Rs. 3.39 billion for the quarter and Rs. 7.39 billion for the first nine months of the financial year 2011/2012, compared to the PBT of Rs. 2.36 billion and Rs. 7.33 billion in the corresponding periods in the previous year. As stated above the previous year’s PBT for the first nine months included capital gains of Rs. 1.79 billion.
While the recurring profits attributable to equity holders grew by 55% for the quarter and 46% for the first nine months, the profits attributable to equity holders for the quarter and first nine months of the financial year 2011/2012 were Rs. 2.73 billion and Rs. 5.68 billion respectively as against Rs. 1.76 billion and Rs. 3.9 billion recorded in the corresponding periods in the previous year.
The Company PBT was Rs. 919 million for the quarter and Rs. 2.42 billion for the first nine months of 2011/2012 compared with the PBT of Rs. 1.12 billion and Rs. 4.44 billion in the corresponding periods in the previous year which included the capital gains.
Transportation PBT for the quarter increased by 44% to Rs. 879 million [2010/11 Q3: Rs. 611 million] on the back of improved performance in all segments.
Leisure recorded a PBT of Rs. 1,002 million for the quarter compared to a PBT of Rs. 632 million recorded in the same period last year, reflecting a growth of 59%. This growth was achieved despite the closure of two resort hotels for a part of the period. Both city hotels contributed significantly to the improved performance with Cinnamon Lakeside operating at full capacity from 1 October following refurbishment of some rooms.
JKH has partnered Sanken Construction Ltd. to build and manage a 240-room business hotel in Colombo and construction is progressing as planned. Chaaya Tranz, Hikkaduwa, which was closed from May 2010 for refurbishment, and Chaaya Wild, Yala, which was closed from May 2011 for refurbishment, were reopened on schedule in November 2011.
The construction of the Rs. 2.63 billion Chaaya Bey, Beruwala, is progressing as planned and will be the latest addition to the resort portfolio in the second half of 2012.
Property recorded a PBT of Rs. 319 million for the quarter, compared to a PBT of Rs. 222 million recorded in the same period last year, reflecting a growth of 44%. The revenue recognition from the ‘Emperor’ project and the ‘OnThree20’ project were the main contributors to the sector’s performance this quarter. The construction of the Rs. 8 billion ‘OnThree20’ project is progressing as planned.
Consumer Foods and Retail PBT of Rs. 532 million for the quarter was an increase of 241% over the same quarter last year [2010/11 Q3: Rs. 156 million]. The soft drinks and ice creams businesses continued to perform exceptionally with higher volumes. The retail business also witnessed an improved performance driven by higher basket values, footfalls and better margins.
Financial Services PBT for the quarter was Rs. 606 million as against Rs. 528 million recorded in the corresponding period in the previous year, reflecting a growth of 15 percent. While Union Assurance and Nations Trust Bank performed to expectations, John Keells Stockbrokers continued to be impacted by the lower market turnover witnessed in the CSE.
Information Technology recorded a PBT of Rs. 65 million for the quarter, which was an improvement of 364% over the same period last year [2010/11 Q3: PBT Rs. 14 million]. The BPO business, which has acquired new customers, saw higher revenues while the Office Automation business continues to perform strongly.
Others comprising Plantation Services, John Keells Capital and the Corporate Centre recorded a PBT of 167 million for the first nine months while recording a marginal loss of Rs. 15 million for the quarter, as against Rs. 2.17 billion and Rs. 192 million recorded in the corresponding periods last year.
The previous year’s PBT for the first nine months included capital gains of Rs. 1.79 billion.
source - www.ft.lk
■9-month after-tax profit up 2% to Rs. 6.25 b; revenue up 28% to Rs. 54.2 b
Premier blue chip John Keells Holdings (JKH) yesterday announced stellar results for its third quarter ended 31 December 2011, reflecting robust performance by all of its core sectors and continued momentum.
Group revenues of Rs. 21.14 billion and Rs. 54.27 billion in the 3Q and the first nine months of 2011/2012 were 35% and 28% above the corresponding periods in the previous year.
Group gross profits of Rs. 5.45 billion and Rs. 12.40 billion in the third quarter and the first nine months of 2011/2012 were 32% and 33% above the Rs. 4.12 billion and Rs. 9.35 billion recorded in the corresponding periods in the previous year.
The recurring Group profit before tax of Rs. 3.39 billion for the quarter and Rs. 7.39 billion for the first nine months of the financial year 2011/2012 grew by 44% and 33% respectively compared to Rs. 2.36 billion and Rs. 5.54 billion in the corresponding periods in the previous year, excluding the gains of Rs.1.79 billion from the sale of stakes in Asian Hotels and Properties PLC (AHPL) and John Keells Hotels PLC (KHL), JKH Chairman Susantha Ratnayake said in his review accompanying interim results.
Group PBT was Rs. 3.39 billion for the quarter and Rs. 7.39 billion for the first nine months of the financial year 2011/2012, compared to the PBT of Rs. 2.36 billion and Rs. 7.33 billion in the corresponding periods in the previous year. As stated above the previous year’s PBT for the first nine months included capital gains of Rs. 1.79 billion.
While the recurring profits attributable to equity holders grew by 55% for the quarter and 46% for the first nine months, the profits attributable to equity holders for the quarter and first nine months of the financial year 2011/2012 were Rs. 2.73 billion and Rs. 5.68 billion respectively as against Rs. 1.76 billion and Rs. 3.9 billion recorded in the corresponding periods in the previous year.
The Company PBT was Rs. 919 million for the quarter and Rs. 2.42 billion for the first nine months of 2011/2012 compared with the PBT of Rs. 1.12 billion and Rs. 4.44 billion in the corresponding periods in the previous year which included the capital gains.
Transportation PBT for the quarter increased by 44% to Rs. 879 million [2010/11 Q3: Rs. 611 million] on the back of improved performance in all segments.
Leisure recorded a PBT of Rs. 1,002 million for the quarter compared to a PBT of Rs. 632 million recorded in the same period last year, reflecting a growth of 59%. This growth was achieved despite the closure of two resort hotels for a part of the period. Both city hotels contributed significantly to the improved performance with Cinnamon Lakeside operating at full capacity from 1 October following refurbishment of some rooms.
JKH has partnered Sanken Construction Ltd. to build and manage a 240-room business hotel in Colombo and construction is progressing as planned. Chaaya Tranz, Hikkaduwa, which was closed from May 2010 for refurbishment, and Chaaya Wild, Yala, which was closed from May 2011 for refurbishment, were reopened on schedule in November 2011.
The construction of the Rs. 2.63 billion Chaaya Bey, Beruwala, is progressing as planned and will be the latest addition to the resort portfolio in the second half of 2012.
Property recorded a PBT of Rs. 319 million for the quarter, compared to a PBT of Rs. 222 million recorded in the same period last year, reflecting a growth of 44%. The revenue recognition from the ‘Emperor’ project and the ‘OnThree20’ project were the main contributors to the sector’s performance this quarter. The construction of the Rs. 8 billion ‘OnThree20’ project is progressing as planned.
Consumer Foods and Retail PBT of Rs. 532 million for the quarter was an increase of 241% over the same quarter last year [2010/11 Q3: Rs. 156 million]. The soft drinks and ice creams businesses continued to perform exceptionally with higher volumes. The retail business also witnessed an improved performance driven by higher basket values, footfalls and better margins.
Financial Services PBT for the quarter was Rs. 606 million as against Rs. 528 million recorded in the corresponding period in the previous year, reflecting a growth of 15 percent. While Union Assurance and Nations Trust Bank performed to expectations, John Keells Stockbrokers continued to be impacted by the lower market turnover witnessed in the CSE.
Information Technology recorded a PBT of Rs. 65 million for the quarter, which was an improvement of 364% over the same period last year [2010/11 Q3: PBT Rs. 14 million]. The BPO business, which has acquired new customers, saw higher revenues while the Office Automation business continues to perform strongly.
Others comprising Plantation Services, John Keells Capital and the Corporate Centre recorded a PBT of 167 million for the first nine months while recording a marginal loss of Rs. 15 million for the quarter, as against Rs. 2.17 billion and Rs. 192 million recorded in the corresponding periods last year.
The previous year’s PBT for the first nine months included capital gains of Rs. 1.79 billion.
source - www.ft.lk
Thursday, January 26, 2012
Sri Lanka bourse up on big foreign buy in Keells
* Foreign inflow at 1.03 bln rupees
* First year-to-date net inflow since 2009
* Keells posts Dec. quarter gain of 56 pct
COLOMBO, Jan 26 (Reuters) - Sri Lanka's share market gained on Thursday in improved volume led by a big foreign buy of market heavyweight John Keells Holdings, helping it record a net offshore inflow for the first time since mid-2009.
The main share index rose 0.65 percent or 36.11 points to 5,592.40, recovering from its lowest level since Aug. 18, 2010, which it touched on Tuesday.
The island nation's bourse saw net foreign buying of 1.03 billion rupees, the highest since May 8, after a Singapore-based fund bought around 7.7 million Keells shares.
After the market closed, Keells posted a 56 percent gain in its December quarter earnings. The conglomerate, which is a favourite of foreign buyers because it is one of the few profitable Sri Lankan shares with a large free float, rose 2.13 percent to 163.40 rupees at the close.
The $18 billion bourse has seen a net offshore inflow of 908.43 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010.
The index was still in the oversold region on Thursday with the Relative Strength Index at 27.965 up from Wednesday's 26.078, slightly below the lower neutral range of 30, Reuters data showed.
It is still the worst performer among Asian markets with a 7.94 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009-2010.
Top lender Commercial Bank of Ceylon rose 0.4 percent to 100 rupees on foreign selling of 2.7 million shares. Retail favourite Asia Asset Finance Ltd rose 9.23 percent to 7.10 rupees.
Conglomerate Aitken Spence PLC after the market closed said in a filing to the bourse that it would realise a capital gain of 630 million rupees on the sale of its 30 percent stake in Colombo harbour container terminal joint venture.
Shares of Spence fell 0.45 percent to 109.50 rupees.
The day's turnover was 2.29 billion Sri Lanka rupees ($20.11 million), highest since Dec. 1 and in line last year's average of 2.3 billion. Volume was 51.9 million shares. Last year's daily average was a record 102.7 million.
The index lost 8.5 percent in 2011 and was Asia's 10th-best performer after being top in the region until June. It was Asia's best in 2009 and 2010.
The rupee closed flat at 113.89/90 to the dollar for a 44th straight session since a Nov. 21 devaluation with the central bank selling around $20 million to defend it, dealers said.
The bank has spent more than $1.07 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay.
Brokers said the market is awaiting the views of the International Monetary Fund (IMF) on the rupee. A team from the global lender is in Sri Lanka to review its $2.6 billion loan. ($1 = 113.8900 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)
source - www.reuters.com
* First year-to-date net inflow since 2009
* Keells posts Dec. quarter gain of 56 pct
COLOMBO, Jan 26 (Reuters) - Sri Lanka's share market gained on Thursday in improved volume led by a big foreign buy of market heavyweight John Keells Holdings, helping it record a net offshore inflow for the first time since mid-2009.
The main share index rose 0.65 percent or 36.11 points to 5,592.40, recovering from its lowest level since Aug. 18, 2010, which it touched on Tuesday.
The island nation's bourse saw net foreign buying of 1.03 billion rupees, the highest since May 8, after a Singapore-based fund bought around 7.7 million Keells shares.
After the market closed, Keells posted a 56 percent gain in its December quarter earnings. The conglomerate, which is a favourite of foreign buyers because it is one of the few profitable Sri Lankan shares with a large free float, rose 2.13 percent to 163.40 rupees at the close.
The $18 billion bourse has seen a net offshore inflow of 908.43 million so far this year, after net outflows of 19.1 billion last year and a record 26.4 billion in 2010.
The index was still in the oversold region on Thursday with the Relative Strength Index at 27.965 up from Wednesday's 26.078, slightly below the lower neutral range of 30, Reuters data showed.
It is still the worst performer among Asian markets with a 7.94 percent loss so far this year. It was 10th-best in 2011, after being on top in 2009-2010.
Top lender Commercial Bank of Ceylon rose 0.4 percent to 100 rupees on foreign selling of 2.7 million shares. Retail favourite Asia Asset Finance Ltd rose 9.23 percent to 7.10 rupees.
Conglomerate Aitken Spence PLC after the market closed said in a filing to the bourse that it would realise a capital gain of 630 million rupees on the sale of its 30 percent stake in Colombo harbour container terminal joint venture.
Shares of Spence fell 0.45 percent to 109.50 rupees.
The day's turnover was 2.29 billion Sri Lanka rupees ($20.11 million), highest since Dec. 1 and in line last year's average of 2.3 billion. Volume was 51.9 million shares. Last year's daily average was a record 102.7 million.
The index lost 8.5 percent in 2011 and was Asia's 10th-best performer after being top in the region until June. It was Asia's best in 2009 and 2010.
The rupee closed flat at 113.89/90 to the dollar for a 44th straight session since a Nov. 21 devaluation with the central bank selling around $20 million to defend it, dealers said.
The bank has spent more than $1.07 billion keeping the exchange rate steady since Nov. 21. It spent a net $1.79 billion in the first 10 months of last year to keep depreciation at bay.
Brokers said the market is awaiting the views of the International Monetary Fund (IMF) on the rupee. A team from the global lender is in Sri Lanka to review its $2.6 billion loan. ($1 = 113.8900 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)
source - www.reuters.com
Sri Lanka JKH net up 56-pct in Dec quarter
Jan 26, 2012 (LBO) - Sri Lanka's John Keells Holdings said profits rose 56 percent to 2.73 billion rupees in the December 2011 quarter from a year earlier, with revenues up 35 percent to 21.1 billion rupees.
The firm reported earnings of 3.21 rupees for the quarter and 6.6.7 rupees for the nine months ending December on profits of 5.6 billion rupees, which were flat.
Segmented results showed transportation which is mainly a container terminal bringing in 842 million rupees (up from 554 million rupees, leisure 756 million (up from 523 million), property 275 million (up from 174 million), consumer foods 372 million (up from 47 million).
Financial service brought in 531 million rupees in profits (up from 338 million) and information technology 48 million rupees, reversing a loss of 9.3 million rupees a year earlier.
source - www.lbo.lk
The firm reported earnings of 3.21 rupees for the quarter and 6.6.7 rupees for the nine months ending December on profits of 5.6 billion rupees, which were flat.
Segmented results showed transportation which is mainly a container terminal bringing in 842 million rupees (up from 554 million rupees, leisure 756 million (up from 523 million), property 275 million (up from 174 million), consumer foods 372 million (up from 47 million).
Financial service brought in 531 million rupees in profits (up from 338 million) and information technology 48 million rupees, reversing a loss of 9.3 million rupees a year earlier.
source - www.lbo.lk
Sunday, January 22, 2012
SEC to remove price bands after trading system upgrade
The Securities and Exchange Commission (SEC) will remove price bands once the Colombo Stock Exchange (CSE) goes online with its Automated Trading System (ATS) upgrade with ATS Version 7 next month, SEC officials said.
"We will replace this with circuit breakers," an SEC official said. The CSE postponed the ATS upgrade amidst some resistance from the stock brokers, early this month.
"This has to be done as the hardware in our system is outdated. We cannot afford another system crash like last year," a CSE source said, adding that last year on September 19 the system went out of control and was not reflecting the actual prices of some shares after it started functioning.
He said the regulator cannot remove price bands (which was also a recent request from the brokers till the Colombo stock Exchange's (CSE) trading platform is upgraded.
source - www.sundaytimes.lk
"We will replace this with circuit breakers," an SEC official said. The CSE postponed the ATS upgrade amidst some resistance from the stock brokers, early this month.
"This has to be done as the hardware in our system is outdated. We cannot afford another system crash like last year," a CSE source said, adding that last year on September 19 the system went out of control and was not reflecting the actual prices of some shares after it started functioning.
He said the regulator cannot remove price bands (which was also a recent request from the brokers till the Colombo stock Exchange's (CSE) trading platform is upgraded.
source - www.sundaytimes.lk
President’s sons in Ascot’s Top Twenty lis
By Ravi Laduwahetty
The president’s two elder sons, Namal and Yoshitha, are listed among the top 20 shareholders of Ascot Holdings PLC according to the company’s interim financial statements.
According to this list, Mr. Y.K. (Yoshitha) Rajapaksa owns 100,000 shares and Mr. L.N. Rajapaksa (Namal) 92,000 shares as at Sept. 30, 2011.
Although in the top 20 list, in percentage terms their shareholding is a modest 1.25% and 1.15% though they are the 12th and 13th largest shareholders in the company which is fairly closely held.
Previously Asian Cotton Mills Ltd., the Jayewardene family had interests in the company founded in the middle sixties to spin cotton yarn. It had extensive property at Ratmalana but was in difficulty for many years due to a number of factors, many of them outside the company’s control.
Mr. A.Y.S. Gnanam, the well known tycoon, ran Ascot for a number of years but could not turn it around. Later control passed to the Kuwaiti investor, Al Nakib. Thereafter a group led by Mr. Rohan Iriyagolle took control, sold off machinery and land and invested the proceeds in a Colombo property development project at T.B. Jayah Mawatha (Darley Road).
The company now operates mainly on the rental income of this property.
Mr. Nimal Perera, financial advisor to Mr. Dhammika Perera and on the boards of companies controlled by him, is also in Ascot’s Top Twenty list with 269,200 (3.37%)and is ranked the sixth largest shareholder.
Axis Financial Services (Pvt) Ltd. with 3 million shares (37.57%) and Boston Capital Pvt. Ltd with 649,500 shares (8.13%) are the two largest shareholders of Ascot with these shares held through two banks. Their individual accounts follow with Axis having a further 358,092 shares (4.48%) and Boston 314,864 shares (3.94%).
Some directors of Ascot are believed to have beneficial interests in shares held by holding companies.
The Ascot share traded at a high of Rs. 207.70 and a low of Rs. 99 in the Sept. quarter 2011 against Rs. 80 and Rs. 47 a year earlier. It closed at Rs. 151.80 on the CSE last Friday.
Total assets as at Sept. were Rs. 1.25 billion and liabilities approx. Rs. 600 million.
The group posted a small loss of Rs. 5.9 million in the period ended Sept. 30, 2011, translating to a loss of Rs. 0.73 per share.
The directors of the company are Messrs. V.P. Malalasekera, Chairman, Rohan Iriyagolle, N.D. Gunaratne, N.A. de Mel, Chanaka de Silva and D.J. Gunaratne.
source - http://www.island.lk/
The president’s two elder sons, Namal and Yoshitha, are listed among the top 20 shareholders of Ascot Holdings PLC according to the company’s interim financial statements.
According to this list, Mr. Y.K. (Yoshitha) Rajapaksa owns 100,000 shares and Mr. L.N. Rajapaksa (Namal) 92,000 shares as at Sept. 30, 2011.
Although in the top 20 list, in percentage terms their shareholding is a modest 1.25% and 1.15% though they are the 12th and 13th largest shareholders in the company which is fairly closely held.
Previously Asian Cotton Mills Ltd., the Jayewardene family had interests in the company founded in the middle sixties to spin cotton yarn. It had extensive property at Ratmalana but was in difficulty for many years due to a number of factors, many of them outside the company’s control.
Mr. A.Y.S. Gnanam, the well known tycoon, ran Ascot for a number of years but could not turn it around. Later control passed to the Kuwaiti investor, Al Nakib. Thereafter a group led by Mr. Rohan Iriyagolle took control, sold off machinery and land and invested the proceeds in a Colombo property development project at T.B. Jayah Mawatha (Darley Road).
The company now operates mainly on the rental income of this property.
Mr. Nimal Perera, financial advisor to Mr. Dhammika Perera and on the boards of companies controlled by him, is also in Ascot’s Top Twenty list with 269,200 (3.37%)and is ranked the sixth largest shareholder.
Axis Financial Services (Pvt) Ltd. with 3 million shares (37.57%) and Boston Capital Pvt. Ltd with 649,500 shares (8.13%) are the two largest shareholders of Ascot with these shares held through two banks. Their individual accounts follow with Axis having a further 358,092 shares (4.48%) and Boston 314,864 shares (3.94%).
Some directors of Ascot are believed to have beneficial interests in shares held by holding companies.
The Ascot share traded at a high of Rs. 207.70 and a low of Rs. 99 in the Sept. quarter 2011 against Rs. 80 and Rs. 47 a year earlier. It closed at Rs. 151.80 on the CSE last Friday.
Total assets as at Sept. were Rs. 1.25 billion and liabilities approx. Rs. 600 million.
The group posted a small loss of Rs. 5.9 million in the period ended Sept. 30, 2011, translating to a loss of Rs. 0.73 per share.
The directors of the company are Messrs. V.P. Malalasekera, Chairman, Rohan Iriyagolle, N.D. Gunaratne, N.A. de Mel, Chanaka de Silva and D.J. Gunaratne.
source - http://www.island.lk/
Friday, January 20, 2012
HNB beats private banks with largest branch network
Hatton National Bank (HNB) said yesterday that it now has the largest branch network among private players in the industry.
It said in keeping with its extensive branch opening strategy pursued in 2011, the bank reached the milestone of 240 Customer Centres with the opening of the Customer Centre in Bandaragama.
“Through this branch expansion strategy pursued in 2011, the bank was able to maintain its position as the private sector commercial bank with the largest network of Customer Centres with the widest reach,” a spokesman for HNB said.
During the past two months HNB opened eight Customer Centres in Kilinochchi, Dehiattakandiya, Galaha, Hakmana, Urubokka, Kalawana, Hikkaduwa and Bandaragama.
“These Customer Centres are bound to add more convenience and banking opportunity to the people in these areas. The bank is steadfast in its focus to have greater financial inclusion among people in Sri Lanka by bringing a comprehensive range of financial services,” he added.
The spokesman said HNB stands tall as one of the largest private sector commercial banks in the country with a focus on corporate banking, trade finance, international banking, treasury, project financing and financing for large infrastructure development projects in the country. The bank is a leader in retail banking and has been awarded the Best Retail Bank in Sri Lanka Award for its performance in 2007, 2008, 2009 and 2010 by the Asian Banker Magazine.
source - www.ft.lk
It said in keeping with its extensive branch opening strategy pursued in 2011, the bank reached the milestone of 240 Customer Centres with the opening of the Customer Centre in Bandaragama.
“Through this branch expansion strategy pursued in 2011, the bank was able to maintain its position as the private sector commercial bank with the largest network of Customer Centres with the widest reach,” a spokesman for HNB said.
During the past two months HNB opened eight Customer Centres in Kilinochchi, Dehiattakandiya, Galaha, Hakmana, Urubokka, Kalawana, Hikkaduwa and Bandaragama.
“These Customer Centres are bound to add more convenience and banking opportunity to the people in these areas. The bank is steadfast in its focus to have greater financial inclusion among people in Sri Lanka by bringing a comprehensive range of financial services,” he added.
The spokesman said HNB stands tall as one of the largest private sector commercial banks in the country with a focus on corporate banking, trade finance, international banking, treasury, project financing and financing for large infrastructure development projects in the country. The bank is a leader in retail banking and has been awarded the Best Retail Bank in Sri Lanka Award for its performance in 2007, 2008, 2009 and 2010 by the Asian Banker Magazine.
source - www.ft.lk
Wednesday, January 18, 2012
BETTING ON OUTSIDERS
Fears of a Western financial meltdown are giving frontier markets a new lease of life
By Lucy Fitzgeorge-Parker
Putting together a well-balanced portfolio has never been easy, but until recently there were at least some certainties investors could rely on. If you wanted a sensible, low- risk investment with a reasonable rate of return, you bought developed-world government bonds or blue-chip stocks; if on the other hand you were prepared to lose your shirt in pursuit of stratospheric profits, you opted for equities from Africa or other exotic destinations.
In the three years since the collapse of Lehman Brothers, however, all that has changed. Not only have many so-called ‘frontier markets’ made giant strides in economic development, but – with contagion from countries such as Ireland and Greece threatening core European markets and the US suffering a sovereign downgrade – the concept of ‘risk-free’ investments has had to be consigned to the dustbin of history.
“Risk-free assets don’t exist and never did, so if you have 90% of your net worth in Europe and the US you’re actually taking a massive gamble,” says Jerome Booth, head of research at specialist emerging markets fund manager Ashmore. “All countries are risky – the difference is that in frontier markets the risk is priced in.”
What is more, frontier markets currently offer something even more valuable for investors and almost non-existent in the developed world – growth. Since the financial crisis, Western economies have been struggling to break free from recession and this has been reflected in near-zero interest rates and wildly volatile stock markets. By contrast, frontier markets such as Sri Lanka, Nigeria and Iraq were barely affected by the global downturn and should post annual GDP growth of more than 6% for the next five years, according to IMF forecasts.
Yet while the risk-reward profile of frontier markets may be looking ever more appealing, gaining exposure to them can still prove frustratingly hard for Western investors and money managers. Indeed, lack of access – whether for reasons of size, liquidity or regulation – is one of the key characteristics that make a market frontier, as opposed to emerging.
Thus the most widely used frame of reference for this equity space, the MSCI Frontier Markets Index, includes tiny EU member Estonia and ultra-wealthy Gulf states such as Qatar that restrict foreign ownership of assets, as well as more obvious choices such as Lebanon, Pakistan and Ukraine. And in the broader frontier universe – usually defined as any of the 100 or so countries that are neither emerging nor developed – a much-hyped new market such as Mongolia can have a daily stock-market turnover of less than $60,000.
This lack of liquidity limits the extent to which larger funds can get involved in frontier markets, partly because of the lack of stocks to buy and partly because purchases of any size will tend to move the market. Yet as veteran asset manager Mark Mobius – who oversees $50bn of emerging and frontier-market investments for Franklin Templeton – explains, the biggest hurdle for funds is often something as simple as the lack of reliable custodian banking. “Unless we’re able to safekeep our securities with a really good custodian, then there’s no way of getting in,” he says.
This limitation means larger firms such as Franklin Templeton are unable to get direct access to many frontier markets – although, as Mobius points out, scale can have its advantages. “As we’re a pretty big money manager, the custodians make a lot of money on our regular funds and we can twist their arm a little bit,” he says. “We can say, ‘Look, we realise that you’re not going to make a ton of money in Laos or Cambodia but we need that, and if they can do it they will accommodate us.”
And there are alternatives to direct investment. In Mongolia, for example, many of the companies that stand to benefit most from its mineral wealth are based in – or listed on the stock markets of – the UK, Canada or Australia. Thus investors can gain exposure to frontier markets’ most lucrative sectors while enjoying the protection of developed- world regulation and corporate governance – not to mention much lower transaction costs. “If we had two companies, one listed in London and one listed in Cambodia, but the London one was more liquid, we would probably favour that one, all things being equal,” says Mobius.
Yet as Arild Johansen, chief analyst at boutique frontier specialist FMG, points out, there are disadvantages to investing indirectly. “The problem with the offshore listings is that they follow the sentiment of the West,” he says, “so if you have a massive correction going on there, these stocks will obviously go down with it because people don’t really care what the underlying drives are. When you invest locally you are cushioned from all that.”
For this reason, he argues, when it comes to frontier markets, “small is beautiful”. Iraq’s nascent stock market, for example, has shown impressive returns over the past two years but is still off-limits to large firms such as Franklin Templeton because of the lack of liquidity and a global custodian – whereas smaller player FMG was able to move into the market as early as May 2010.
“It gives the boutiques a way to go into exciting areas before the big funds consider them,” Johansen adds. “And it gives us time to build a nice position and be there with real money and a good chunk of the money by the time they find it interesting so they can take it up to the next level.
To us it’s important to get started early in these markets as most returns are made in the initial part of the curve.”
Slim Feriani, CEO of boutique manager Advanced Emerging Capital, agrees that first-mover advantage is a key attraction. “The commonality across all the frontier markets is that they are probably the most under-researched and underinvested countries globally. That’s where the opportunity is because that can only change,” he says. “You’ll have more people investing in them, and if you have moved in before the crowds, then typically all the boats will get lifted at one point in time.”
There are, of course, downsides to going down the boutique route, as investors in several smaller Africa funds found in 2008 – when the credit crunch hit, ‘hot money’ deserted the frontier space, forcing funds to sell out at a loss and ultimately close. For this reason, managers of open-ended funds are at pains to stress that frontier should be seen as a long-term investment. “We try to make sure investors understand that when you buy into, say, Iraq, that you should have at least a five-year horizon on your money and look at it as a liquid private- equity investment,” says Johansen.
And events of the past year suggest investors have taken this message on board. As Ashmore’s Booth points out, when political turmoil engulfed the Middle East and North Africa (MENA) in the spring, emerging-market equity funds saw substantial withdrawals by the US retail- investor base but, for the most part, frontier funds were unaffected. “The hot money that poured into frontier markets in 2007 and 2008 came out and never came back again,” he says. “These days when a crisis seems to be looming, there isn’t a massive rush for the exit because the people invested in frontier aren’t fleet of foot.”
What some analysts fear could spark a panic, given the preponderance of commodity-rich economies in the frontier space, is the much-touted prospect of a hard landing in China. “As long as growth overall doesn’t slow dramatically and commodity prices remain at similar levels to where they are today, then frontier markets are in excellent shape,” says Johansen. “But if, God forbid, China should slash into growth to absolutely nothing and their appetite for commodities dropped accordingly, then these economies are extremely vulnerable to that.”
Most frontier managers, however, dismiss such fears as overdone – Mobius says speculation about problems in China is driven by hedge funds talking their own books, while Ashmore’s Booth points out that even after a major correction, emerging markets would likely still show growth rates well above anything imaginable in the West. “Yes, one needs to be concerned about commodities, but if you’ve got something big enough to really cause you to be worried, then you want more frontier markets and you want to have nothing in the US or Europe,” he says.
Mobius also insists that the concept of frontier markets as pure commodities plays is misguided given that – as, for example, in Nigeria, a resource-rich country and one of the fastest-growing economies in the frontier space – both the firms that control the sector and the money made from it are frequently kept outside the jurisdiction. “I wouldn’t say frontier investors need to be bullish on commodities, I would say they need to be bullish on the growth of consumer markets,” he says.
For him, the most exciting recent development both in Nigeria and other markets such as Vietnam is the move towards privatisation of utilities, which provides a large investor such as Franklin Templeton with a rare combination of scale, regulatory security and exposure to an infrastructure boom he sees as inevitable. “On average, including all the basket cases, emerging and frontier markets are growing three times faster than developed countries and that means there’s demand for everything,” he says, citing his own recent experience of being twice stuck in an elevator in Lagos due to power outages.
Feriani at Advanced Emerging Capital agrees that consumer stocks – typically dominated by sectors such as finance, telcos, retail, food and beverage, and infrastructure – offer the best opportunities for frontier investors, giving access to the growing middle class and providing some insulation from events in developed markets. “We prefer to be exposed to the domestic sector in these rapidly growing economies because the export sector remains vulnerable to what happens in the West for the time being and how the Western consumer behaves,” he says.
Indeed, lack of correlation with both the rest of the world and each other remains one of the key appeals of frontier economies – particularly after three years of repeated convulsions in the core markets of Europe and the US. As Feriani points out: “Many of these countries are actually negatively correlated with each other – if you have an event in Tunisia you don’t expect contagion from that in Vietnam, and what happens at the macro level in Qatar doesn’t necessarily have anything to do with what’s happening in Argentina.”
Some frontier advocates go even further. “Even if the fundamentals in the US and Europe are getting really bad, there are always going to be pockets of investors with money to spend and it’s not absurd to think that many of them might start looking at the better-managed frontier markets as safe havens over the next five years,” says Peter Bartlett, managing director of frontier-investment bank Exotix. He cites the example of Dubai, which saw huge capital inflows during the MENA region troubles this year, and Mauritius, which has already achieved partial safe- haven status for African investors.
For Mobius, the biggest challenge is overcoming outdated investor prejudice. “It’s beginning to dawn on people that the perception of risk is changing – but it’s going to take a long time because it’s very difficult to explain that if you really want to be safe, you’ve got to be diversified, and the way to diversify is to get out of your own country and invest globally,” he says.
Booth at Ashmore agrees that frontier markets stand to benefit from a paradigm shift on the part of investors in the near future. “As the perception of risk and the perception of macroeconomic factors filters into the heads of big institutional investors, it’s going to radically change the way they view the world and the way they think about asset allocation, and that’s naturally going to lead to more allocation to emerging and frontier markets,” he says.
If they are right, frontier’s early adopters could yet be the big winners of the next investment cycle.
THE FINAL FRONTIER
For risk-hungry investors, the news that frontier markets are becoming safer by the day is far from welcome. Fortunately for such souls there are still economies at the extreme edge that offer the prospect of huge returns and equally large losses.
Countries such as North Korea, Cuba and Zimbabwe offer what is known as an ‘event risk’ profile. As Peter Bartlett of Exotix explains: “You buy into these economies because, while it’s very hard for you to say what the right value should be on those assets at the moment, you know that there is an event in each of these countries that will stimulate a massive surge in demand.”
In many cases that event is the removal or death of whoever is in power. For North Korea it would be the signing of a reunification treaty with its southern neighbour.
Gaining access to these markets is not easy but several have outstanding bonds, and in Zimbabwe stocks such as drinks- maker Delta and telecoms firm Econet offer upside potential. Advanced Emerging Capital’s frontier fund has a 3% allocation, and CEO Slim Feriani sees it as a long-term play. “We don’t expect Zimbabwe to become a South Africa overnight but in situations like this one, the impact of any positive change on returns from an equity-market point of view could be massive,” he adds.
TIPPED FOR SUCCESS
Frontier’s next hotspots
Mark Mobius, Franklin Templeton
CAMBODIA, LAOS, BANGLADESH, SRI LANKA, COLOMBIA, PERU, LIBYA
“Laos has just opened its stock exchange and we’re looking at that, and there are places that in the past we were invested in and we’ll go back into, such as Bangladesh and Sri Lanka. Before the recent upheaval we were invested in Libya... I would say we’ll be back there within a year.”
Peter Bartlett, Exotix
MONGOLIA, SRI LANKA, BANGLADESH, PAKISTAN, ANGOLA, RWANDA, ZAMBIA, EGYPT, THE CARIBBEAN, KAZAKHSTAN, KENYA
“If the smaller English-speaking Caribbean islands could pool their list of companies into one stock market, you’d have some interesting opportunities. Kazakhstan and Kenya lost a third of their value this year... At some point they will bounce back.”
Arild Johansen, FMG
RWANDA, GHANA
“Rwanda is a booming economy – they’ve just set up their capital markets and they’ve started listing some companies. Ghana recently became an exporter of oil and is growing tremendously – and it doesn’t just have oil, it also has other commodities such as cocoa, coff ee and gold.”
Jerome Booth, Ashmore Investment Management
QATAR, ZAMBIA, MAURITIUS, BOTSWANA, ZIMBABWE, NIGERIA, EGYPT
“We’re bullish on Nigeria, particularly the financial sector. Places such as Zambia offer commodities exposure and have always been very well run. We’ve got almost 5% of our frontier market fund in Botswana, and there are things in Zimbabwe.”
source - http://www.cnbcmagazine.com/story/betting-on-outsiders/1498/1/
By Lucy Fitzgeorge-Parker
Putting together a well-balanced portfolio has never been easy, but until recently there were at least some certainties investors could rely on. If you wanted a sensible, low- risk investment with a reasonable rate of return, you bought developed-world government bonds or blue-chip stocks; if on the other hand you were prepared to lose your shirt in pursuit of stratospheric profits, you opted for equities from Africa or other exotic destinations.
In the three years since the collapse of Lehman Brothers, however, all that has changed. Not only have many so-called ‘frontier markets’ made giant strides in economic development, but – with contagion from countries such as Ireland and Greece threatening core European markets and the US suffering a sovereign downgrade – the concept of ‘risk-free’ investments has had to be consigned to the dustbin of history.
“Risk-free assets don’t exist and never did, so if you have 90% of your net worth in Europe and the US you’re actually taking a massive gamble,” says Jerome Booth, head of research at specialist emerging markets fund manager Ashmore. “All countries are risky – the difference is that in frontier markets the risk is priced in.”
What is more, frontier markets currently offer something even more valuable for investors and almost non-existent in the developed world – growth. Since the financial crisis, Western economies have been struggling to break free from recession and this has been reflected in near-zero interest rates and wildly volatile stock markets. By contrast, frontier markets such as Sri Lanka, Nigeria and Iraq were barely affected by the global downturn and should post annual GDP growth of more than 6% for the next five years, according to IMF forecasts.
Yet while the risk-reward profile of frontier markets may be looking ever more appealing, gaining exposure to them can still prove frustratingly hard for Western investors and money managers. Indeed, lack of access – whether for reasons of size, liquidity or regulation – is one of the key characteristics that make a market frontier, as opposed to emerging.
Thus the most widely used frame of reference for this equity space, the MSCI Frontier Markets Index, includes tiny EU member Estonia and ultra-wealthy Gulf states such as Qatar that restrict foreign ownership of assets, as well as more obvious choices such as Lebanon, Pakistan and Ukraine. And in the broader frontier universe – usually defined as any of the 100 or so countries that are neither emerging nor developed – a much-hyped new market such as Mongolia can have a daily stock-market turnover of less than $60,000.
This lack of liquidity limits the extent to which larger funds can get involved in frontier markets, partly because of the lack of stocks to buy and partly because purchases of any size will tend to move the market. Yet as veteran asset manager Mark Mobius – who oversees $50bn of emerging and frontier-market investments for Franklin Templeton – explains, the biggest hurdle for funds is often something as simple as the lack of reliable custodian banking. “Unless we’re able to safekeep our securities with a really good custodian, then there’s no way of getting in,” he says.
This limitation means larger firms such as Franklin Templeton are unable to get direct access to many frontier markets – although, as Mobius points out, scale can have its advantages. “As we’re a pretty big money manager, the custodians make a lot of money on our regular funds and we can twist their arm a little bit,” he says. “We can say, ‘Look, we realise that you’re not going to make a ton of money in Laos or Cambodia but we need that, and if they can do it they will accommodate us.”
And there are alternatives to direct investment. In Mongolia, for example, many of the companies that stand to benefit most from its mineral wealth are based in – or listed on the stock markets of – the UK, Canada or Australia. Thus investors can gain exposure to frontier markets’ most lucrative sectors while enjoying the protection of developed- world regulation and corporate governance – not to mention much lower transaction costs. “If we had two companies, one listed in London and one listed in Cambodia, but the London one was more liquid, we would probably favour that one, all things being equal,” says Mobius.
Yet as Arild Johansen, chief analyst at boutique frontier specialist FMG, points out, there are disadvantages to investing indirectly. “The problem with the offshore listings is that they follow the sentiment of the West,” he says, “so if you have a massive correction going on there, these stocks will obviously go down with it because people don’t really care what the underlying drives are. When you invest locally you are cushioned from all that.”
For this reason, he argues, when it comes to frontier markets, “small is beautiful”. Iraq’s nascent stock market, for example, has shown impressive returns over the past two years but is still off-limits to large firms such as Franklin Templeton because of the lack of liquidity and a global custodian – whereas smaller player FMG was able to move into the market as early as May 2010.
“It gives the boutiques a way to go into exciting areas before the big funds consider them,” Johansen adds. “And it gives us time to build a nice position and be there with real money and a good chunk of the money by the time they find it interesting so they can take it up to the next level.
To us it’s important to get started early in these markets as most returns are made in the initial part of the curve.”
Slim Feriani, CEO of boutique manager Advanced Emerging Capital, agrees that first-mover advantage is a key attraction. “The commonality across all the frontier markets is that they are probably the most under-researched and underinvested countries globally. That’s where the opportunity is because that can only change,” he says. “You’ll have more people investing in them, and if you have moved in before the crowds, then typically all the boats will get lifted at one point in time.”
There are, of course, downsides to going down the boutique route, as investors in several smaller Africa funds found in 2008 – when the credit crunch hit, ‘hot money’ deserted the frontier space, forcing funds to sell out at a loss and ultimately close. For this reason, managers of open-ended funds are at pains to stress that frontier should be seen as a long-term investment. “We try to make sure investors understand that when you buy into, say, Iraq, that you should have at least a five-year horizon on your money and look at it as a liquid private- equity investment,” says Johansen.
And events of the past year suggest investors have taken this message on board. As Ashmore’s Booth points out, when political turmoil engulfed the Middle East and North Africa (MENA) in the spring, emerging-market equity funds saw substantial withdrawals by the US retail- investor base but, for the most part, frontier funds were unaffected. “The hot money that poured into frontier markets in 2007 and 2008 came out and never came back again,” he says. “These days when a crisis seems to be looming, there isn’t a massive rush for the exit because the people invested in frontier aren’t fleet of foot.”
What some analysts fear could spark a panic, given the preponderance of commodity-rich economies in the frontier space, is the much-touted prospect of a hard landing in China. “As long as growth overall doesn’t slow dramatically and commodity prices remain at similar levels to where they are today, then frontier markets are in excellent shape,” says Johansen. “But if, God forbid, China should slash into growth to absolutely nothing and their appetite for commodities dropped accordingly, then these economies are extremely vulnerable to that.”
Most frontier managers, however, dismiss such fears as overdone – Mobius says speculation about problems in China is driven by hedge funds talking their own books, while Ashmore’s Booth points out that even after a major correction, emerging markets would likely still show growth rates well above anything imaginable in the West. “Yes, one needs to be concerned about commodities, but if you’ve got something big enough to really cause you to be worried, then you want more frontier markets and you want to have nothing in the US or Europe,” he says.
Mobius also insists that the concept of frontier markets as pure commodities plays is misguided given that – as, for example, in Nigeria, a resource-rich country and one of the fastest-growing economies in the frontier space – both the firms that control the sector and the money made from it are frequently kept outside the jurisdiction. “I wouldn’t say frontier investors need to be bullish on commodities, I would say they need to be bullish on the growth of consumer markets,” he says.
For him, the most exciting recent development both in Nigeria and other markets such as Vietnam is the move towards privatisation of utilities, which provides a large investor such as Franklin Templeton with a rare combination of scale, regulatory security and exposure to an infrastructure boom he sees as inevitable. “On average, including all the basket cases, emerging and frontier markets are growing three times faster than developed countries and that means there’s demand for everything,” he says, citing his own recent experience of being twice stuck in an elevator in Lagos due to power outages.
Feriani at Advanced Emerging Capital agrees that consumer stocks – typically dominated by sectors such as finance, telcos, retail, food and beverage, and infrastructure – offer the best opportunities for frontier investors, giving access to the growing middle class and providing some insulation from events in developed markets. “We prefer to be exposed to the domestic sector in these rapidly growing economies because the export sector remains vulnerable to what happens in the West for the time being and how the Western consumer behaves,” he says.
Indeed, lack of correlation with both the rest of the world and each other remains one of the key appeals of frontier economies – particularly after three years of repeated convulsions in the core markets of Europe and the US. As Feriani points out: “Many of these countries are actually negatively correlated with each other – if you have an event in Tunisia you don’t expect contagion from that in Vietnam, and what happens at the macro level in Qatar doesn’t necessarily have anything to do with what’s happening in Argentina.”
Some frontier advocates go even further. “Even if the fundamentals in the US and Europe are getting really bad, there are always going to be pockets of investors with money to spend and it’s not absurd to think that many of them might start looking at the better-managed frontier markets as safe havens over the next five years,” says Peter Bartlett, managing director of frontier-investment bank Exotix. He cites the example of Dubai, which saw huge capital inflows during the MENA region troubles this year, and Mauritius, which has already achieved partial safe- haven status for African investors.
For Mobius, the biggest challenge is overcoming outdated investor prejudice. “It’s beginning to dawn on people that the perception of risk is changing – but it’s going to take a long time because it’s very difficult to explain that if you really want to be safe, you’ve got to be diversified, and the way to diversify is to get out of your own country and invest globally,” he says.
Booth at Ashmore agrees that frontier markets stand to benefit from a paradigm shift on the part of investors in the near future. “As the perception of risk and the perception of macroeconomic factors filters into the heads of big institutional investors, it’s going to radically change the way they view the world and the way they think about asset allocation, and that’s naturally going to lead to more allocation to emerging and frontier markets,” he says.
If they are right, frontier’s early adopters could yet be the big winners of the next investment cycle.
THE FINAL FRONTIER
For risk-hungry investors, the news that frontier markets are becoming safer by the day is far from welcome. Fortunately for such souls there are still economies at the extreme edge that offer the prospect of huge returns and equally large losses.
Countries such as North Korea, Cuba and Zimbabwe offer what is known as an ‘event risk’ profile. As Peter Bartlett of Exotix explains: “You buy into these economies because, while it’s very hard for you to say what the right value should be on those assets at the moment, you know that there is an event in each of these countries that will stimulate a massive surge in demand.”
In many cases that event is the removal or death of whoever is in power. For North Korea it would be the signing of a reunification treaty with its southern neighbour.
Gaining access to these markets is not easy but several have outstanding bonds, and in Zimbabwe stocks such as drinks- maker Delta and telecoms firm Econet offer upside potential. Advanced Emerging Capital’s frontier fund has a 3% allocation, and CEO Slim Feriani sees it as a long-term play. “We don’t expect Zimbabwe to become a South Africa overnight but in situations like this one, the impact of any positive change on returns from an equity-market point of view could be massive,” he adds.
TIPPED FOR SUCCESS
Frontier’s next hotspots
Mark Mobius, Franklin Templeton
CAMBODIA, LAOS, BANGLADESH, SRI LANKA, COLOMBIA, PERU, LIBYA
“Laos has just opened its stock exchange and we’re looking at that, and there are places that in the past we were invested in and we’ll go back into, such as Bangladesh and Sri Lanka. Before the recent upheaval we were invested in Libya... I would say we’ll be back there within a year.”
Peter Bartlett, Exotix
MONGOLIA, SRI LANKA, BANGLADESH, PAKISTAN, ANGOLA, RWANDA, ZAMBIA, EGYPT, THE CARIBBEAN, KAZAKHSTAN, KENYA
“If the smaller English-speaking Caribbean islands could pool their list of companies into one stock market, you’d have some interesting opportunities. Kazakhstan and Kenya lost a third of their value this year... At some point they will bounce back.”
Arild Johansen, FMG
RWANDA, GHANA
“Rwanda is a booming economy – they’ve just set up their capital markets and they’ve started listing some companies. Ghana recently became an exporter of oil and is growing tremendously – and it doesn’t just have oil, it also has other commodities such as cocoa, coff ee and gold.”
Jerome Booth, Ashmore Investment Management
QATAR, ZAMBIA, MAURITIUS, BOTSWANA, ZIMBABWE, NIGERIA, EGYPT
“We’re bullish on Nigeria, particularly the financial sector. Places such as Zambia offer commodities exposure and have always been very well run. We’ve got almost 5% of our frontier market fund in Botswana, and there are things in Zimbabwe.”
source - http://www.cnbcmagazine.com/story/betting-on-outsiders/1498/1/
Saboteurs and sceptics at work?
The loss of momentum yesterday despite the early boost following the SEC’s easing of credit rules saw some market circles privately talking of theories of sabotage and sceptics being at work.
This couldn’t be verified independently, but at least one broker alluded to scepticism in its market report. DNH Financial in its commentary said it was “time to shed the scepticism”.
It said that while the number of sceptical market participants sitting on the sidelines appeared to be relatively large, given the presumption that the bourse simply has to retreat before it can move upwards, a key argument underlying its overweight recommendation on the bourse was that market fundamentals had improved significantly with valuations for several stocks trading at highly attractive multiples.
“Many of the stocks we recommend are in the industrials, banking, diversified and tourism sectors. While these companies possess significant long-term fundamentals and produce substantial cash flow, several of them have suffered price declines over the last few months producing highly attractive buying opportunities trading at less than 10X multiples,” DNH added.
source - www.ft.lk
This couldn’t be verified independently, but at least one broker alluded to scepticism in its market report. DNH Financial in its commentary said it was “time to shed the scepticism”.
It said that while the number of sceptical market participants sitting on the sidelines appeared to be relatively large, given the presumption that the bourse simply has to retreat before it can move upwards, a key argument underlying its overweight recommendation on the bourse was that market fundamentals had improved significantly with valuations for several stocks trading at highly attractive multiples.
“Many of the stocks we recommend are in the industrials, banking, diversified and tourism sectors. While these companies possess significant long-term fundamentals and produce substantial cash flow, several of them have suffered price declines over the last few months producing highly attractive buying opportunities trading at less than 10X multiples,” DNH added.
source - www.ft.lk
Harry’s 23-year stint on HNB Board ends
Business leader Harry Jayawardena has vacated his Board seat which he occupied for 23 years in HNB Plc.
This was in conformity with the Monetary Board direction on good corporate governance.
In a filing to the CSE, the HNB said at a Board meeting on 12 January that it was decided that by operation of Monetary Board Direction No. 11 of 2007 as amended by Direction No. 5 of 2008 issued under the Banking Act, D.H.S. Jayawardena is deemed to have vacated his office as a Director of HNB after having completed his term of office.
“His vacation of post as a Director of HNB was accepted by the Board with effect from 31 December 2011,” HNB added.
Jayawardena was first appointed to the Board in 1988. Via Milford Exports, Stassen Exports and Distilleries, Jayawardena currently controls a 15% stake in HNB.
Also in compliance with Monetary Board directives, Raja Obeyesekere resigned from the HNB Board from 31 December 2011.
source - www.ft.lk
This was in conformity with the Monetary Board direction on good corporate governance.
In a filing to the CSE, the HNB said at a Board meeting on 12 January that it was decided that by operation of Monetary Board Direction No. 11 of 2007 as amended by Direction No. 5 of 2008 issued under the Banking Act, D.H.S. Jayawardena is deemed to have vacated his office as a Director of HNB after having completed his term of office.
“His vacation of post as a Director of HNB was accepted by the Board with effect from 31 December 2011,” HNB added.
Jayawardena was first appointed to the Board in 1988. Via Milford Exports, Stassen Exports and Distilleries, Jayawardena currently controls a 15% stake in HNB.
Also in compliance with Monetary Board directives, Raja Obeyesekere resigned from the HNB Board from 31 December 2011.
source - www.ft.lk
Monday, January 16, 2012
Sri Lanka SEC allows more broker credit
Jan 16, 2012 (LBO) - Sri Lanka's Securities and Exchange Commission said it had allowed brokers to lend up to three times their net capital to clients to buy shares in a relaxation of credit rules imposed last year.
The adjusted net capital is arrived at after deducting from net capital 50 percent of the value of fixed assets.
Earlier brokers were only allowed to lend only their own assets. The new rule allows them to leverage, effectively engaging in a finance business of borrowing and lending.
The SEC said the new rule will increase the amount all brokers can lend to the market to 8.7 billion rupees from the current 5.0 billion rupees.
In 2011, the SEC put credit curbs and the stocks, especially fundamentally weak illiquid stocks were punted upwards amid credit bubble supported by lower interest rates and excess liquidity in the banking system.
Credit growth has since hit the balance of payments and rates are now rising.
The market has since corrected and profits of many firms have also improved.
Brokers went to Sri Lanka's President to pressure the SEC to relax credit rules, eventually leading to the resignation of the chairperson of the SEC.
The cabinet of ministers earlier removed the SEC director general soon after a crackdown on price manipulation, hype and dump scams and insider dealing started.
source - www.lbo.lk
The adjusted net capital is arrived at after deducting from net capital 50 percent of the value of fixed assets.
Earlier brokers were only allowed to lend only their own assets. The new rule allows them to leverage, effectively engaging in a finance business of borrowing and lending.
The SEC said the new rule will increase the amount all brokers can lend to the market to 8.7 billion rupees from the current 5.0 billion rupees.
In 2011, the SEC put credit curbs and the stocks, especially fundamentally weak illiquid stocks were punted upwards amid credit bubble supported by lower interest rates and excess liquidity in the banking system.
Credit growth has since hit the balance of payments and rates are now rising.
The market has since corrected and profits of many firms have also improved.
Brokers went to Sri Lanka's President to pressure the SEC to relax credit rules, eventually leading to the resignation of the chairperson of the SEC.
The cabinet of ministers earlier removed the SEC director general soon after a crackdown on price manipulation, hype and dump scams and insider dealing started.
source - www.lbo.lk
Credit Boom
The SEC further relaxes stock broker credit extension – additional credit available will increase by Rs. 5 billion resulting in total credit available in the market to Rs. 8.7 billion
At the Commission meeting held on 16th January 2012, the Securities and Exchange Commission of Sri Lanka (SEC) decided to permit Stock Broking Firms to leverage 3 times adjusted Net Capital with immediate effect. “Adjusted Net Capital” is the Net Capital computed as per the Colombo Stock Exchange (CSE) Member Regulations less 50% of Fixed Assets. In line with other regional markets, 50% was deducted to take into account the concerns of realizing illiquid assets into cash.
By permitting the Stock Broking Firms to leverage 3 times adjusted Net Capital, the additional credit available in the market will increase by Rs 5 billion resulting in the total credit available among Stock Broking Firms to Rs 8.7 billion.
Having considered the dimensions of credit extension and to establish a balance between the two principals of lending norms and risk management the SEC reviewed the Credit Extension by Stock Broker Firms.
As a Capital Market Regulator, it is a core function of the SEC to ensure that capital and other prudential requirements are sufficient to address the level of risk taking by the Stock Broking Firms in extending credit with adequacy in the financial strength, disclosures, systems and governance processes which should be monitored on a regular basis in order to prevent any systemic risk to the Capital Market.
At present the Stock Broking Companies are permitted to extend credit based on the Liquid Assets of the company less obligations.
source - www.lankabusinesstoday.com
At the Commission meeting held on 16th January 2012, the Securities and Exchange Commission of Sri Lanka (SEC) decided to permit Stock Broking Firms to leverage 3 times adjusted Net Capital with immediate effect. “Adjusted Net Capital” is the Net Capital computed as per the Colombo Stock Exchange (CSE) Member Regulations less 50% of Fixed Assets. In line with other regional markets, 50% was deducted to take into account the concerns of realizing illiquid assets into cash.
By permitting the Stock Broking Firms to leverage 3 times adjusted Net Capital, the additional credit available in the market will increase by Rs 5 billion resulting in the total credit available among Stock Broking Firms to Rs 8.7 billion.
Having considered the dimensions of credit extension and to establish a balance between the two principals of lending norms and risk management the SEC reviewed the Credit Extension by Stock Broker Firms.
As a Capital Market Regulator, it is a core function of the SEC to ensure that capital and other prudential requirements are sufficient to address the level of risk taking by the Stock Broking Firms in extending credit with adequacy in the financial strength, disclosures, systems and governance processes which should be monitored on a regular basis in order to prevent any systemic risk to the Capital Market.
At present the Stock Broking Companies are permitted to extend credit based on the Liquid Assets of the company less obligations.
source - www.lankabusinesstoday.com
Sunday, January 15, 2012
MTD Walkers involved in A32 road construction, piling work at top hotel site
With two major contracts in the bag -- constructing the A32 road linking the North and South and the piling contract for the 5-Star international Hotel Softlogic Movenpick through a subsidiary CML MTD Construction Ltd -, MTD Walkers PLC says it’s looking forward to a progressive year.
Viraj de Silva, the group’s Chief Financial Officer, said these projects are two of the largest contracts to be undertaken by any engineering company in 2011. “We successfully won these contracts and both these projects are slated for completion within the next two years,” he said in a press release issued by the company.
Describing the organization as Sri Lanka’s only listed, fully fledged engineering and infrastructure-development company, the release said the company will undertake the construction of 36 km of the A32 road at a cost of Rs 1.7 billion. On completion, the road will connect the North with the South and will be the shortest route from Colombo to Jaffna.
CML-MTD Construction has also received a letter of acceptance for the reconstruction of the Giriulla –Narammala Highway worth Rs 1.4 billion. The company has already successfully completed the construction of substantial components of the new Southern Expressway and is in the process of contributing specialist construction capacity for constructing the Colombo-Katunayake Expressway.
The statement said Walkers’ Piling (Pvt) Ltd, a fully owned subsidiary of MTD Walkers and one of the largest piling contractors in Sri Lanka, will commence work this month at the Movenpick hotel site using specialized ‘secant’ piling technique which is frequently used overseas for deep excavation.
source - www.sundaytimes.lk
Viraj de Silva, the group’s Chief Financial Officer, said these projects are two of the largest contracts to be undertaken by any engineering company in 2011. “We successfully won these contracts and both these projects are slated for completion within the next two years,” he said in a press release issued by the company.
Describing the organization as Sri Lanka’s only listed, fully fledged engineering and infrastructure-development company, the release said the company will undertake the construction of 36 km of the A32 road at a cost of Rs 1.7 billion. On completion, the road will connect the North with the South and will be the shortest route from Colombo to Jaffna.
CML-MTD Construction has also received a letter of acceptance for the reconstruction of the Giriulla –Narammala Highway worth Rs 1.4 billion. The company has already successfully completed the construction of substantial components of the new Southern Expressway and is in the process of contributing specialist construction capacity for constructing the Colombo-Katunayake Expressway.
The statement said Walkers’ Piling (Pvt) Ltd, a fully owned subsidiary of MTD Walkers and one of the largest piling contractors in Sri Lanka, will commence work this month at the Movenpick hotel site using specialized ‘secant’ piling technique which is frequently used overseas for deep excavation.
source - www.sundaytimes.lk
Qatar seeks stakes in CSE, Kalpitiya and other property
By Duruthu Edirimuni Chandrasekera
Qatar Holdings, the investment arm of the state-owned Qatar Investment Authority, is interested in various development projects ranging from a stake in the Colombo Stock Exchange (CSE), the Kalpitiya Tourism Zone (KTZ), the Colombo Commercial Property (CCP), and a host of sites in the South for hotel projects, according to official sources.
A preparatory team ahead of today’s arrival (visit) of Sheikh Hamad bin Khalifa Al-Thani, the Ruler of Qatar, is in Colombo here at the moment and a group of six including the Deputy CEO of the Qatari Exchange has had initial discussions at a joint meeting with the Securities and Exchange Commission (SEC) and the CSE on Thursday and a separate meeting with the SEC on Friday, a source close to the discussions told the Business Times on Friday.
He said the Qatar Holdings, which owns around 20% in the London Stock Exchange, will do a feasibility study of the CSE in an effort to invest in a 'sizeable' stake. “But the CSE has to be demutualised and made into a public limited company which is now being fast-tracked," he said. He added that much assistance by the World Bank team during the last year was obtained in this regard and within six months' time CSE's demutualisation will be completed. "The team wanted to know about the demutualisation, about CSE's IT platform, details on the transaction settlement time, legal framework, etc,” he said.
He added that the visitors are also eyeing tourism projects and looking at the KTZ and the Colombo Commercial Property at Sir James Pieris Mawatha for hotel projects. “They are also keen on real estate development and are scouting for land,” he said. There are 17 islands in the Kalpitiya area, which is a peninsula that separates the Puttalam lagoon from the Indian Ocean and is about 150 km away from Colombo. The source added that Qatar Holdings is interested in a large site in this area which will most probably include these islands. “They are eyeing mixed development for CCP,” he said.
He added that the Qatari leader will be accompanied by a group of leading Qatari investors who will explore the possibilities for mobilisation of more Qatar investment in the tourism industry and also infrastructure projects in the agriculture and fisheries sectors.
During his two-day visit, he will hold bilateral talks with President Mahinda Rajapaksa and other ministers and officials. Several agreements covering improvement of bilateral relations in economic, trade, investment, cultural and industrial sectors are also scheduled to be signed during the visit.
Last month, Sheikh Hamad bin Jassim Al-Thani, the Prime Minister of Qatar visited Sri Lanka.
source - www.sundaytimes.lk
Qatar Holdings, the investment arm of the state-owned Qatar Investment Authority, is interested in various development projects ranging from a stake in the Colombo Stock Exchange (CSE), the Kalpitiya Tourism Zone (KTZ), the Colombo Commercial Property (CCP), and a host of sites in the South for hotel projects, according to official sources.
A preparatory team ahead of today’s arrival (visit) of Sheikh Hamad bin Khalifa Al-Thani, the Ruler of Qatar, is in Colombo here at the moment and a group of six including the Deputy CEO of the Qatari Exchange has had initial discussions at a joint meeting with the Securities and Exchange Commission (SEC) and the CSE on Thursday and a separate meeting with the SEC on Friday, a source close to the discussions told the Business Times on Friday.
He said the Qatar Holdings, which owns around 20% in the London Stock Exchange, will do a feasibility study of the CSE in an effort to invest in a 'sizeable' stake. “But the CSE has to be demutualised and made into a public limited company which is now being fast-tracked," he said. He added that much assistance by the World Bank team during the last year was obtained in this regard and within six months' time CSE's demutualisation will be completed. "The team wanted to know about the demutualisation, about CSE's IT platform, details on the transaction settlement time, legal framework, etc,” he said.
He added that the visitors are also eyeing tourism projects and looking at the KTZ and the Colombo Commercial Property at Sir James Pieris Mawatha for hotel projects. “They are also keen on real estate development and are scouting for land,” he said. There are 17 islands in the Kalpitiya area, which is a peninsula that separates the Puttalam lagoon from the Indian Ocean and is about 150 km away from Colombo. The source added that Qatar Holdings is interested in a large site in this area which will most probably include these islands. “They are eyeing mixed development for CCP,” he said.
He added that the Qatari leader will be accompanied by a group of leading Qatari investors who will explore the possibilities for mobilisation of more Qatar investment in the tourism industry and also infrastructure projects in the agriculture and fisheries sectors.
During his two-day visit, he will hold bilateral talks with President Mahinda Rajapaksa and other ministers and officials. Several agreements covering improvement of bilateral relations in economic, trade, investment, cultural and industrial sectors are also scheduled to be signed during the visit.
Last month, Sheikh Hamad bin Jassim Al-Thani, the Prime Minister of Qatar visited Sri Lanka.
source - www.sundaytimes.lk
Saturday, January 14, 2012
MTD Walkers announces major projects for 2012
New construction and piling plans get underway
MTD Walkers, Sri Lanka’s only listed, fully fledged engineering and infrastructure development company, continues to affirm its role in the Nation’s infrastructure development drive through its subsidiary CML MTD Construction Ltd contracting to construct the A32, which is an important conduit between the North and South. Meanwhile, their other subsidiary, Walkers Pilling has won the Piling contract for the new five-star international Hotel Softlogic Movenpick.
According to MTD Walkers PLC CFO Viraj de Silva, these projects are two of the largest contracts to be undertaken by any engineering company in 2011. de Silva said, “We have successfully won these contracts and both these projects are slated for completion within the next two years.”
As one of the best rated general contractors in the country specialising in road construction, railway and road bridges, the Company will undertake the construction of 36 kilometres of A32 roadway which is expected to be completed by 2013.
After completion, the A32 road will connect the North with the South and will be the shortest route from Colombo to Jaffna. De Silva added that the cost of the road construction is Rs. 1.7 Billion. CML-MTD Construction has also received a letter of acceptance for the reconstruction of the Giriulla –Narammala Highway at a value of Rs 1.4 billion. The Company has received the highest CI grading in three construction sectors, namely Highways, Bridges and Land Reclamation. The Company also has received ISO-9001:2008 Quality Standard certification from BVQI for its management systems in connection with earth moving and land grading, roads, road bridges, railway bridges, industrial parks, irrigation systems, storm water drainage, port construction and building of revetments, sheet piling, concrete pile driving, pre-cast concrete products, industrial mining, quarrying and crushing.
In continuation of its policy of being extremely sensitive to Environmental impacts caused by construction activities and considering the steps taken to minimise such impacts the company recently obtained ISO 14001-2004 certification for environmental management systems from SGS.
The company has already successfully completed the construction of substantial components of the new Southern Expressway and is in the process of contributing specialist construction capacity for constructing the Colombo-Katunayaka Expressway.
Meanwhile, Walkers’ Piling (Pvt) Ltd, a fully owned subsidiary of MTD Walkers and one of the largest piling contractors in Sri Lanka has secured the contract to carry out piling work on the world renowned Movenpick Hotel, commissioned by Softlogic.
Walkers Piling will commence work this month using specialised ‘secant’ piling technique which is frequently used overseas for deep excavation.
The Softlogic Movenpick Hotel is one of several international hotels slated to commence operations in Sri Lanka following the post-war Nation development drive. The Chief Operating Officer of MTD Walkers Piling, Lal Perera said, “Winning this contract is an endorsement of our strength and confidence as one of the most reliable companies to handle such large projects. We have previously carried out numerous large projects successfully and are now in the forefront of this industry.”
For the past 30 years, Walkers Piling Ltd., the pioneer Pile Foundation company in Sri Lanka, has been specialising in pile foundations. The Company was incorporated in the year 1981 along with Voltas International Limited of India as a joint venture with approvals from Foreign Investment Advisory Committee of Sri Lanka. In 2008, the company was acquired by MTD Walkers PLC, the only fully fledged multi disciplinary Engineering Company in Sri Lanka.
source - www.ft.lk - 11-01-2012
Annual Report - KAPI [ 2010/2011]
Quaterly Report - KAPI [2011 - 09]
MTD Walkers, Sri Lanka’s only listed, fully fledged engineering and infrastructure development company, continues to affirm its role in the Nation’s infrastructure development drive through its subsidiary CML MTD Construction Ltd contracting to construct the A32, which is an important conduit between the North and South. Meanwhile, their other subsidiary, Walkers Pilling has won the Piling contract for the new five-star international Hotel Softlogic Movenpick.
According to MTD Walkers PLC CFO Viraj de Silva, these projects are two of the largest contracts to be undertaken by any engineering company in 2011. de Silva said, “We have successfully won these contracts and both these projects are slated for completion within the next two years.”
As one of the best rated general contractors in the country specialising in road construction, railway and road bridges, the Company will undertake the construction of 36 kilometres of A32 roadway which is expected to be completed by 2013.
After completion, the A32 road will connect the North with the South and will be the shortest route from Colombo to Jaffna. De Silva added that the cost of the road construction is Rs. 1.7 Billion. CML-MTD Construction has also received a letter of acceptance for the reconstruction of the Giriulla –Narammala Highway at a value of Rs 1.4 billion. The Company has received the highest CI grading in three construction sectors, namely Highways, Bridges and Land Reclamation. The Company also has received ISO-9001:2008 Quality Standard certification from BVQI for its management systems in connection with earth moving and land grading, roads, road bridges, railway bridges, industrial parks, irrigation systems, storm water drainage, port construction and building of revetments, sheet piling, concrete pile driving, pre-cast concrete products, industrial mining, quarrying and crushing.
In continuation of its policy of being extremely sensitive to Environmental impacts caused by construction activities and considering the steps taken to minimise such impacts the company recently obtained ISO 14001-2004 certification for environmental management systems from SGS.
The company has already successfully completed the construction of substantial components of the new Southern Expressway and is in the process of contributing specialist construction capacity for constructing the Colombo-Katunayaka Expressway.
Meanwhile, Walkers’ Piling (Pvt) Ltd, a fully owned subsidiary of MTD Walkers and one of the largest piling contractors in Sri Lanka has secured the contract to carry out piling work on the world renowned Movenpick Hotel, commissioned by Softlogic.
Walkers Piling will commence work this month using specialised ‘secant’ piling technique which is frequently used overseas for deep excavation.
The Softlogic Movenpick Hotel is one of several international hotels slated to commence operations in Sri Lanka following the post-war Nation development drive. The Chief Operating Officer of MTD Walkers Piling, Lal Perera said, “Winning this contract is an endorsement of our strength and confidence as one of the most reliable companies to handle such large projects. We have previously carried out numerous large projects successfully and are now in the forefront of this industry.”
For the past 30 years, Walkers Piling Ltd., the pioneer Pile Foundation company in Sri Lanka, has been specialising in pile foundations. The Company was incorporated in the year 1981 along with Voltas International Limited of India as a joint venture with approvals from Foreign Investment Advisory Committee of Sri Lanka. In 2008, the company was acquired by MTD Walkers PLC, the only fully fledged multi disciplinary Engineering Company in Sri Lanka.
source - www.ft.lk - 11-01-2012
Annual Report - KAPI [ 2010/2011]
Quaterly Report - KAPI [2011 - 09]
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