The Colombo Stock Exchange gained 0.77 percent last week with the All Share Price Index (ASPI) gaining 55.3 points to close the week at 7,240.27 points. The Milanka Price Index (MPI) of more liquid stocks grew at a sharper rate, gaining 146.4 points to close the week at 6,838.02 points, up 2.19 percent from a week earlier, brokers said.
Year-to-date, the Colombo Stock Exchange grew 9.11 percent as at the week ending March 25, 2011 while the MPI declined 3.16 percent.
Average daily turnover last week amounted to Rs. 2,871.2 million. There was a net outflow of foreign investments totaling Rs. 2,019.67 million. So far this year, net foreign outflow amounted to Rs. 6,549.81 million as at March 25.
The top five gainers last week (March 21 to 25) where Ceylon Cold Stores up 33.18 percent to close at Rs. 799.10, Tea Smallholder Factories up 32.06 percent to Rs. 224.5, LB Finance up 31.23 percent to Rs. 178.6, Central Finance up 30.61 percent to Rs. 1,050 and Sierra Cables up 28.26 percent to close at Rs. 5.9.
The five biggest losers were Guardian Capital Partners down 76.46 percent to close at Rs. 294.2, Amana Takaful, down 30.30 percent to close at Rs. 2.3, SMP Leasing down 16.67 percent to 50 cents, Industrial Asphalt down 13.16 percent to Rs. 425.5 and Convenience Foods Lanka down 12.91 percent to close the week at Rs. 400.6.
"The indices saw positive growth during the week with MPI growing faster than the ASPI on renewed buying interest. The week saw heavy institutional and high net-worth individual participation with large trades on CFIN and CINS while DIST gained majority control of SUGA. Foreign participation accounted for a net outflow during the week primarily due to selling of stake on CINS," John Keells Stockbrokers said.
"The week started off on dull sentiments and volatility was felt across the bourse during the trading week. However renewed interest on selective stocks namely, LFIN, CFIN, SUGA kept the market alive, in our view. The week saw a total of 323.9 n shares changing hands," Bartleet Mallaroy Stockbrokers said.
"Institutional and high net-worth presence was seen more prominently during the week with keen interest towards Finance stocks, in our view. Recovery of global rubber prices drew interest towards rubber plantation stocks, towards the end of the week, in our view," it said.
source - www.island.lk
Monday, March 28, 2011
Dhammika, Nimal to fire big guns To consolidate Hayleys' control
By Indika Sakalasooriya
Dhammika Perera and Nimal Perera, probably the most dynamic figures in the country’s recent business history, are planning to consolidate control in Hayleys Plc through some stern, yet controversial decisions in the coming few months, Mirror Business learns.
“Hayleys has been run by a Trust throughout. But as majority stakeholders, we have decided to put an end to this. We have lost our patience over the unprogressive manner in which the company is being run presently,” Nimal Perera, Director of Hayleys, Managing Director of Royal Ceramics and the party acting along with Dhammika in the Hayleys mandatory offer said.
The so called ‘Independent Directors’ sitting in the Hayleys board have prevented the company progressing to the next level, and now since Dhammika and Royal Ceramics own over 30 percent of the company, they have decided to end these directors’ unwanted interventions, Nimal Perera added.
“The Hayleys Annual General Meeting (AGM) is due in June and we have decided not to vote for the re-election of three Independent Non Executive Directors,” he stressed.“According to our classification, none of them are ‘Independent’, as they have vested interests and are acting in conflict of interests. For example, one such director is in the board of another reputed apparel group. Hayleys is also in the textile business through MGT. So isn’t there a conflict of interest?” he questioned.
Perera also said, another director who is abroad most of the time, participates in board meetings over the telephone. “The company has to pay for two business class air tickets for him to be here and attend meetings every three months,” Nimal Perera pointed out.
It is learnt that whatever proposal Dhammika and Nimal present to the Hayleys board, are rejected by the three directors.
“For an example, we proposed to acquire a leisure company from the market under Hayleys Leisure, which will undoubtedly benefit the company. These directors stressed on various rigid procedures and we were unable to acquire it at last. If they are so concerned about procedures, why couldn’t they take any board level action against the Rs.600 million fraud that took place in MGT Knitting, which is dubbed as the biggest corporate fraud in the recent times? They simply want to keep Dhammika and myself out of the action,” Nimal Perera pointed out.
When asked whether the duo will get the required backing to prevent the directors getting re-elected, Perera said that all the Executive Directors, including the Hayleys Chairman Mohan Pandithage are with them. “Up to now, we have not objected or overruled any of the decisions by these directors. We have run out of patience. I don’t think anybody would challenge our leadership in the company, as we are the major shareholders. All Hayleys subsidiaries work closely with us. Once these three directors leave the Hayleys board, we will appoint real Independent Directors, who will strive for the company’s progress,” Perera said.
The present Director board of Hayleys comprises of Mohan Pandithage, L.K.B Godamune, M.R Zaheed, A.m Senaratne, Dhammika Perera, Nimal Perera and S.C Ganegoda. When inquired how confident are they in acquiring 51 percent or the controlling stake of Hayleys Nimal Perera said, “Well, during the course of time, we’ll be able to get to that point. In fact, we are not bothered about it since we are the largest stakeholders in the company”.
Dhammika Perera acting in concert with RCL, triggered the Takeovers and Mergers code in Hayleys, crossing the 30 percent threshold, in the latter part of January, 2011. However, the subsequent mandatory offer by Dhammika and RCL at Rs.380 to acquire the remaining shares of the company was accepted by only a handful of Hayleys shareholders amounting to 0.1 percent.
The director board, following a report by an Independent Advisor ruled out the offer saying the price was ‘unattractive’. “This decision was taken at a secret board meeting that excluded us. They didn’t at least have the courtesy to inform us,” Perera lamented.
Heyleys Plc was considered a conglomerate inaccessible to outsiders, due to actions by its former Chairmen. Up to now, Jayasundera Trust remains the second largest shareholder of the company holding just over 11 percent, while internal arrangement ESOP owns a 9% stake, as at December 31, 2010.
Founded in 1878 as Chas P. Hayley & Company, Hayleys is described as one of the largest Sri Lankan conglomerates. Its portfolio of globally competitive core businesses includes global markets and manufacturing, agriculture and agri business, transportation and infrastructure and consumer products and leisure. Hayleys also accounts for 2.45% of Sri Lanka’s export income.
source - www.dailymirror.lk
Dhammika Perera and Nimal Perera, probably the most dynamic figures in the country’s recent business history, are planning to consolidate control in Hayleys Plc through some stern, yet controversial decisions in the coming few months, Mirror Business learns.
“Hayleys has been run by a Trust throughout. But as majority stakeholders, we have decided to put an end to this. We have lost our patience over the unprogressive manner in which the company is being run presently,” Nimal Perera, Director of Hayleys, Managing Director of Royal Ceramics and the party acting along with Dhammika in the Hayleys mandatory offer said.
The so called ‘Independent Directors’ sitting in the Hayleys board have prevented the company progressing to the next level, and now since Dhammika and Royal Ceramics own over 30 percent of the company, they have decided to end these directors’ unwanted interventions, Nimal Perera added.
“The Hayleys Annual General Meeting (AGM) is due in June and we have decided not to vote for the re-election of three Independent Non Executive Directors,” he stressed.“According to our classification, none of them are ‘Independent’, as they have vested interests and are acting in conflict of interests. For example, one such director is in the board of another reputed apparel group. Hayleys is also in the textile business through MGT. So isn’t there a conflict of interest?” he questioned.
Perera also said, another director who is abroad most of the time, participates in board meetings over the telephone. “The company has to pay for two business class air tickets for him to be here and attend meetings every three months,” Nimal Perera pointed out.
It is learnt that whatever proposal Dhammika and Nimal present to the Hayleys board, are rejected by the three directors.
“For an example, we proposed to acquire a leisure company from the market under Hayleys Leisure, which will undoubtedly benefit the company. These directors stressed on various rigid procedures and we were unable to acquire it at last. If they are so concerned about procedures, why couldn’t they take any board level action against the Rs.600 million fraud that took place in MGT Knitting, which is dubbed as the biggest corporate fraud in the recent times? They simply want to keep Dhammika and myself out of the action,” Nimal Perera pointed out.
When asked whether the duo will get the required backing to prevent the directors getting re-elected, Perera said that all the Executive Directors, including the Hayleys Chairman Mohan Pandithage are with them. “Up to now, we have not objected or overruled any of the decisions by these directors. We have run out of patience. I don’t think anybody would challenge our leadership in the company, as we are the major shareholders. All Hayleys subsidiaries work closely with us. Once these three directors leave the Hayleys board, we will appoint real Independent Directors, who will strive for the company’s progress,” Perera said.
The present Director board of Hayleys comprises of Mohan Pandithage, L.K.B Godamune, M.R Zaheed, A.m Senaratne, Dhammika Perera, Nimal Perera and S.C Ganegoda. When inquired how confident are they in acquiring 51 percent or the controlling stake of Hayleys Nimal Perera said, “Well, during the course of time, we’ll be able to get to that point. In fact, we are not bothered about it since we are the largest stakeholders in the company”.
Dhammika Perera acting in concert with RCL, triggered the Takeovers and Mergers code in Hayleys, crossing the 30 percent threshold, in the latter part of January, 2011. However, the subsequent mandatory offer by Dhammika and RCL at Rs.380 to acquire the remaining shares of the company was accepted by only a handful of Hayleys shareholders amounting to 0.1 percent.
The director board, following a report by an Independent Advisor ruled out the offer saying the price was ‘unattractive’. “This decision was taken at a secret board meeting that excluded us. They didn’t at least have the courtesy to inform us,” Perera lamented.
Heyleys Plc was considered a conglomerate inaccessible to outsiders, due to actions by its former Chairmen. Up to now, Jayasundera Trust remains the second largest shareholder of the company holding just over 11 percent, while internal arrangement ESOP owns a 9% stake, as at December 31, 2010.
Founded in 1878 as Chas P. Hayley & Company, Hayleys is described as one of the largest Sri Lankan conglomerates. Its portfolio of globally competitive core businesses includes global markets and manufacturing, agriculture and agri business, transportation and infrastructure and consumer products and leisure. Hayleys also accounts for 2.45% of Sri Lanka’s export income.
source - www.dailymirror.lk
John Keells Tea Report: Good support from UK, Japan and continent
As expected, Sri Lanka Tea Crop for the month of February at 21.6 mkgs shows a decline of 1.9 mkgs (-8 percent) compared with the corresponding month of 2010.
To end February of 2011 the shortage on last year is around 9.3 mkgs (-17.97 percent).
On the global front supply is continuing to tighten up in most major producing countries due to inclement weather.
Supply from Kenya is expected to constrict as very little rain is forecast and the much awaited long rains are expected to be highly depressed as reported by their Meteorological Department which could trigger high prices of food, electricity and water shortages.
North and South India have also recorded negative variances compared to previous year with short falls of 2.3 mkgs and 3.9 mkgs respectively. Most planting districts in Sri Lanka have recorded much drier weather in the month of March coupled with intermittent showers, conditions which are more conducive for crop intakes. Reports from the plantations suggest that March crop would exceed last year’s crop of 20.4 mkgs.
Quality from the Western Sector has shown a marked decline compared to previous seasons, due to regular showers in February and March and consequently only a handful of Invoices bordering on seasonal character will be on offer. The global shortage in the first quarter of 2011 was expected to impact on prices, but unfortunately the volatile situation in the Middle East and the devastation in Japan following the earthquake and tsunami may in fact reverse this trend.
Today’s Ex Estate teas comprising of 1.14 mkgs met with lower demand for the majority of the teas on sale with a limited number of brighter teas on offer and buyers unable to source the required quantity of seasonal teas. A few Western BOPs surpassed Rs 500, the balance select Best invoices were irregular.
The Below Best and plainer invoices were barely steady and declined Rs 5 to Rs 10 and more on average. The BOPFs too were of a weaker market with only a handful of top end invoices selling well.
All others declined Rs 10 to Rs 15. Nuwara Eliya, once again continued its upward trend for both BOP and BOPFs with a few brighter invoices touching Rs 500.
There was an All Time Record established for a BOPF grade from Pedro Estate with an invoice of Lovers Leap selling at Rs 500. This line of tea was purchased by M/s Elink Schuurman Ceylon (Pvt) Ltd.
Uva BOPs were firm to marginally easier, whilst BOPFs declined Rs 10 to Rs 15 and mostly sold Rs 15 to Rs 20 below its counter part. Best Low Grown CTC PF1s were firm to a little easier, whilst others declined Rs 15 to Rs 20. A few BOP1s on offer sold well appreciating Rs 5 to Rs 10. High and Medium PF1s declined sharply by Rs 20 and more with a number of invoices remaining unsold for want of bids. Brokens too were of a easier market.
There was good support from UK, Japan and Continent for liquors with some brightness and hint of seasonal character, whilst the tea bag sector too lent some support. Russia was a bit selective.
The 3.4 mkg of Low Growns that were on offer this week, met with less demand, particularly for the Small Leaf varieties.
Iran, the major buyer for Tippy varieties commenced their New Year holidays this week, which will go on till the second week of April 2011.
Customarily, most business establishments during this period with little or no purchases made. Hence, the Small Leaf market will continue to be sluggish during this period.
The unrest in Libya has also effected their purchases in Colombo with some of the major buyers being rather subdued which was the main reason for the OP/OPA grade to decline as much as Rs 15 to Rs 20 this week. With the uncertainty prevailing in the Middle East and also the Iranian New Year holidays, it is un-likely that the Low Grown prices would see much of a change in the next two to three weeks.
Western teas
A few Select Best BOPs advanced substantially following special inquiry, other good invoices were barely steady and declined Rs 10, Below Best sorts shed Rs 10 to Rs 15, Plainer varieties eased Rs 5 to Rs 10.
A few Select Best BOPFs were firm whilst the others declined Rs 5 to Rs 10 and more, Below Best sorts eased Rs 10 to Rs 15 on average, Plainer varieties shed Rs 5 to Rs 10. Medium BOPs advanced Rs 10. BOPFs shed Rs 5 to 10 on average.
Nuwara Eliya teas
BOPs advanced Rs 30 to Rs 40 and more whilst the BOPFs gained Rs 40 to Rs 60 and more at times.
Uva teas
BOPs gained Rs 5 to Rs 10 and more at times. BOPFs eased Rs 10. Udapussellawa BOPs shed Rs 5 to Rs 10 whilst the BOPFs eased Rs 15 to Rs 20 on average.
CTC teas
Low Grown CTC PF1s shed Rs 15 to Rs 20 and more at times.
BP1s were firm. High and Medium PF1s declined Rs 10 to Rs 15 and more as the sale progressed. BP1s shed Rs 10 to Rs 15, with a large volume remaining unsold.
Low growns
Lower demand. Select Best OP1s shed Rs 10 on average, Best types were firm to Rs 5 to Rs 10 lower at times, Below Best and Poor sorts too were lower by Rs 10 to Rs 15. Select Best BOP1s eased Rs 10 to Rs 20, Best types declined sharply by Rs 20 to Rs 30, Below Best and poor sorts too were lower by Rs 10 to Rs 15.
Select Best along with the Best ops shed Rs 10 to Rs 20, Below Best and poor sorts too were lower by Rs 10 to Rs 15.
Select Best OPAs were lower by Rs 10 to Rs 20 and more at times, the balance too eased by Rs 10 to Rs 15.
Select Best Pekoes shed Rs 20 to Rs 30 Best and Below Best types were firm to Rs 5 to Rs 10 lower following quality, flaky types were irregularly lower by Rs 5 to Rs 10. Below Best Pekoe1s appreciated Rs 20 to Rs 30, however the balance were firm to lower by Rs 5 to Rs 10.
Select Best BOP/BOPSP were lower by Rs 5 to Rs 10, Best types were lower by Rs 10 per kg, Below Best sorts were lower by Rs 10, poorer sorts appreciated a few rupees above last.
Select Best and Best FBOP/FBOPF1s were lower by Rs 10 to Rs 20 and at times more as the sale progressed, Below Best types were lower by Rs 10 to Rs 15, poorer sorts maintained last levels. Select Best and Best Tippy varieties declined substantially on last levels, Below Best and poorer sorts too were lower to last.
Off grades
Select Best and Best liquoring Fngs1s depreciated Rs 10 to Rs 15, whilst the Best and Below Best types were lower by Rs 10. Select Best and Best BMs declined Rs 10 to Rs 15, whilst the poorer sorts met with good demand and appreciated Rs 10 to Rs 15. All BPs sold at firm levels. All Low Grown Fngs were firm to dearer by Rs 5. Select Best BOP1As along with the best were firm to irregularly lower by Rs 5, Below Best were firm on last levels, poorer BOP1As eased Rs 5 to Rs 10 and more at times.
Dust
Select Best Dust1s were firm, a few invoices in the Best and Below Best category maintained last levels whilst the balance declined Rs 20 to Rs 25. All secondary Dusts were firm. Best Low Grown Dusts and Dust1s appreciated Rs 10 to Rs 15 whilst the balance were firm.
source - www.dailynews.lk
To end February of 2011 the shortage on last year is around 9.3 mkgs (-17.97 percent).
On the global front supply is continuing to tighten up in most major producing countries due to inclement weather.
Supply from Kenya is expected to constrict as very little rain is forecast and the much awaited long rains are expected to be highly depressed as reported by their Meteorological Department which could trigger high prices of food, electricity and water shortages.
North and South India have also recorded negative variances compared to previous year with short falls of 2.3 mkgs and 3.9 mkgs respectively. Most planting districts in Sri Lanka have recorded much drier weather in the month of March coupled with intermittent showers, conditions which are more conducive for crop intakes. Reports from the plantations suggest that March crop would exceed last year’s crop of 20.4 mkgs.
Quality from the Western Sector has shown a marked decline compared to previous seasons, due to regular showers in February and March and consequently only a handful of Invoices bordering on seasonal character will be on offer. The global shortage in the first quarter of 2011 was expected to impact on prices, but unfortunately the volatile situation in the Middle East and the devastation in Japan following the earthquake and tsunami may in fact reverse this trend.
Today’s Ex Estate teas comprising of 1.14 mkgs met with lower demand for the majority of the teas on sale with a limited number of brighter teas on offer and buyers unable to source the required quantity of seasonal teas. A few Western BOPs surpassed Rs 500, the balance select Best invoices were irregular.
The Below Best and plainer invoices were barely steady and declined Rs 5 to Rs 10 and more on average. The BOPFs too were of a weaker market with only a handful of top end invoices selling well.
All others declined Rs 10 to Rs 15. Nuwara Eliya, once again continued its upward trend for both BOP and BOPFs with a few brighter invoices touching Rs 500.
There was an All Time Record established for a BOPF grade from Pedro Estate with an invoice of Lovers Leap selling at Rs 500. This line of tea was purchased by M/s Elink Schuurman Ceylon (Pvt) Ltd.
Uva BOPs were firm to marginally easier, whilst BOPFs declined Rs 10 to Rs 15 and mostly sold Rs 15 to Rs 20 below its counter part. Best Low Grown CTC PF1s were firm to a little easier, whilst others declined Rs 15 to Rs 20. A few BOP1s on offer sold well appreciating Rs 5 to Rs 10. High and Medium PF1s declined sharply by Rs 20 and more with a number of invoices remaining unsold for want of bids. Brokens too were of a easier market.
There was good support from UK, Japan and Continent for liquors with some brightness and hint of seasonal character, whilst the tea bag sector too lent some support. Russia was a bit selective.
The 3.4 mkg of Low Growns that were on offer this week, met with less demand, particularly for the Small Leaf varieties.
Iran, the major buyer for Tippy varieties commenced their New Year holidays this week, which will go on till the second week of April 2011.
Customarily, most business establishments during this period with little or no purchases made. Hence, the Small Leaf market will continue to be sluggish during this period.
The unrest in Libya has also effected their purchases in Colombo with some of the major buyers being rather subdued which was the main reason for the OP/OPA grade to decline as much as Rs 15 to Rs 20 this week. With the uncertainty prevailing in the Middle East and also the Iranian New Year holidays, it is un-likely that the Low Grown prices would see much of a change in the next two to three weeks.
Western teas
A few Select Best BOPs advanced substantially following special inquiry, other good invoices were barely steady and declined Rs 10, Below Best sorts shed Rs 10 to Rs 15, Plainer varieties eased Rs 5 to Rs 10.
A few Select Best BOPFs were firm whilst the others declined Rs 5 to Rs 10 and more, Below Best sorts eased Rs 10 to Rs 15 on average, Plainer varieties shed Rs 5 to Rs 10. Medium BOPs advanced Rs 10. BOPFs shed Rs 5 to 10 on average.
Nuwara Eliya teas
BOPs advanced Rs 30 to Rs 40 and more whilst the BOPFs gained Rs 40 to Rs 60 and more at times.
Uva teas
BOPs gained Rs 5 to Rs 10 and more at times. BOPFs eased Rs 10. Udapussellawa BOPs shed Rs 5 to Rs 10 whilst the BOPFs eased Rs 15 to Rs 20 on average.
CTC teas
Low Grown CTC PF1s shed Rs 15 to Rs 20 and more at times.
BP1s were firm. High and Medium PF1s declined Rs 10 to Rs 15 and more as the sale progressed. BP1s shed Rs 10 to Rs 15, with a large volume remaining unsold.
Low growns
Lower demand. Select Best OP1s shed Rs 10 on average, Best types were firm to Rs 5 to Rs 10 lower at times, Below Best and Poor sorts too were lower by Rs 10 to Rs 15. Select Best BOP1s eased Rs 10 to Rs 20, Best types declined sharply by Rs 20 to Rs 30, Below Best and poor sorts too were lower by Rs 10 to Rs 15.
Select Best along with the Best ops shed Rs 10 to Rs 20, Below Best and poor sorts too were lower by Rs 10 to Rs 15.
Select Best OPAs were lower by Rs 10 to Rs 20 and more at times, the balance too eased by Rs 10 to Rs 15.
Select Best Pekoes shed Rs 20 to Rs 30 Best and Below Best types were firm to Rs 5 to Rs 10 lower following quality, flaky types were irregularly lower by Rs 5 to Rs 10. Below Best Pekoe1s appreciated Rs 20 to Rs 30, however the balance were firm to lower by Rs 5 to Rs 10.
Select Best BOP/BOPSP were lower by Rs 5 to Rs 10, Best types were lower by Rs 10 per kg, Below Best sorts were lower by Rs 10, poorer sorts appreciated a few rupees above last.
Select Best and Best FBOP/FBOPF1s were lower by Rs 10 to Rs 20 and at times more as the sale progressed, Below Best types were lower by Rs 10 to Rs 15, poorer sorts maintained last levels. Select Best and Best Tippy varieties declined substantially on last levels, Below Best and poorer sorts too were lower to last.
Off grades
Select Best and Best liquoring Fngs1s depreciated Rs 10 to Rs 15, whilst the Best and Below Best types were lower by Rs 10. Select Best and Best BMs declined Rs 10 to Rs 15, whilst the poorer sorts met with good demand and appreciated Rs 10 to Rs 15. All BPs sold at firm levels. All Low Grown Fngs were firm to dearer by Rs 5. Select Best BOP1As along with the best were firm to irregularly lower by Rs 5, Below Best were firm on last levels, poorer BOP1As eased Rs 5 to Rs 10 and more at times.
Dust
Select Best Dust1s were firm, a few invoices in the Best and Below Best category maintained last levels whilst the balance declined Rs 20 to Rs 25. All secondary Dusts were firm. Best Low Grown Dusts and Dust1s appreciated Rs 10 to Rs 15 whilst the balance were firm.
source - www.dailynews.lk
Retail run continues momentum
The week saw both indices moving up marginally, with the ASPI gaining 0.7 percent or 55.33 points and the MPI gaining 2.19 percent, a gain of 146.42 points.
The MPI closed at 6838.02. The weekly turnover saw a substantial increase in value at Rs 14.35 billion, from that of the previous week of Rs 7.13 billion, a growth of 101.34 percent. Turnover in volume grew by 15.33 percent as 323.9 million shares were transacted as against last week’s 280.8 million.
The Banking and Finance sector contributed over 45.6 percent of the weeks turnover driven by Central Finance, Ceylinco Insurance, LB Finance, and Vallibel Finance, followed by Manufacturing which accounted for 17 percent dominated by interest in Royal Ceramics.
The other major contributors to the week’s turnover were Investment Trusts and the Diversified sector.
In terms of turnover volumes, Manufacturing sector led the way accounting for more than 32.8 percent of total volumes with trades in Sierra Cables, Piramal and Blue Diamonds, followed closely by the Banking and Finance sector with 32 percent of the trading volumes as investor interest in SMB Leasing, Amana and Vallibel Finance drive sector volumes.
Central Finance dominated the market with a turnover of Rs 2.44 billion representing 17.06 percent of total market turnover. Ceylinco Insurance recorded a turnover of Rs 1.93 billion, accounting for 13.44 percent of total market turnover.
Pelwatte Sugar contributed 9.63 percent of market turnover recording Rs 1.38 billion followed by strategic investment in the share. L B Finance, Guardian Capital and Distilleries turnover amounted to Rs 714.05 million, Rs 627.65 million and Rs 571.19 million respectively.
Cold Stores was this week’s Top Price Gainer with the share increasing from Rs 600 to close at Rs 799, a 33 percent increase. Next on the list was Tea Smallholders with a price gain of Rs 32 percent as the share grew from Rs 170 to Rs 225. LB Finance which closed at Rs 178.60 also saw a 31 percent price hike.
Guardian Capital was the major loser during the week with a decline in the share price of 76 percent to close at Rs 294.2 from Rs 1200 at the start of the week. Amana lost 30 percent to close at Rs 2.30 whilst Huejay, Industrial Asphalts and Convenience Foods were amongst other losers for the week.
Foreign investors returned to net sellers this week with total sales of Rs 2.51 billion representing a growth in selling interest by over 193 percent while purchases at Rs 498 million saw a growth of 81 percent. The increase in net selling was 205 percent, as net sellers recorded Rs 2.01 billion.
Pelwatte Sugar toped in the volume chart with 45.81 million shares changing hands denoting 14.14 percent of market volume. Sierra Cables accounted for 11.87 percent of market volume with the share closing at Rs 5.90. Pan Asian Power, S M B Leasing and Richard Pieris recorded share volumes of 35.33 million, 17.80 million and 14.57 million respectively.
Point of view
The Colombo bourse remained stable during this week’s trading with both indices gaining ground compared to the downturn witnessed the previous week.
Retail investors continued to be active in the market while a few strategic investments also boosted activity levels.
We expect the current retail drive to continue into the week ahead.
Union Bank debuts in the secondary market on Tuesday and with the IPO being oversubscribed around 350 times is expected to attract investor interest.
Sound earnings reported by key growth sectors such as Plantations, Food and Beverage, Manufacturing have reiterated values for selected counters at current price levels which may renew buying interest among investors.
source - www.dailynews.lk
The MPI closed at 6838.02. The weekly turnover saw a substantial increase in value at Rs 14.35 billion, from that of the previous week of Rs 7.13 billion, a growth of 101.34 percent. Turnover in volume grew by 15.33 percent as 323.9 million shares were transacted as against last week’s 280.8 million.
The Banking and Finance sector contributed over 45.6 percent of the weeks turnover driven by Central Finance, Ceylinco Insurance, LB Finance, and Vallibel Finance, followed by Manufacturing which accounted for 17 percent dominated by interest in Royal Ceramics.
The other major contributors to the week’s turnover were Investment Trusts and the Diversified sector.
In terms of turnover volumes, Manufacturing sector led the way accounting for more than 32.8 percent of total volumes with trades in Sierra Cables, Piramal and Blue Diamonds, followed closely by the Banking and Finance sector with 32 percent of the trading volumes as investor interest in SMB Leasing, Amana and Vallibel Finance drive sector volumes.
Central Finance dominated the market with a turnover of Rs 2.44 billion representing 17.06 percent of total market turnover. Ceylinco Insurance recorded a turnover of Rs 1.93 billion, accounting for 13.44 percent of total market turnover.
Pelwatte Sugar contributed 9.63 percent of market turnover recording Rs 1.38 billion followed by strategic investment in the share. L B Finance, Guardian Capital and Distilleries turnover amounted to Rs 714.05 million, Rs 627.65 million and Rs 571.19 million respectively.
Cold Stores was this week’s Top Price Gainer with the share increasing from Rs 600 to close at Rs 799, a 33 percent increase. Next on the list was Tea Smallholders with a price gain of Rs 32 percent as the share grew from Rs 170 to Rs 225. LB Finance which closed at Rs 178.60 also saw a 31 percent price hike.
Guardian Capital was the major loser during the week with a decline in the share price of 76 percent to close at Rs 294.2 from Rs 1200 at the start of the week. Amana lost 30 percent to close at Rs 2.30 whilst Huejay, Industrial Asphalts and Convenience Foods were amongst other losers for the week.
Foreign investors returned to net sellers this week with total sales of Rs 2.51 billion representing a growth in selling interest by over 193 percent while purchases at Rs 498 million saw a growth of 81 percent. The increase in net selling was 205 percent, as net sellers recorded Rs 2.01 billion.
Pelwatte Sugar toped in the volume chart with 45.81 million shares changing hands denoting 14.14 percent of market volume. Sierra Cables accounted for 11.87 percent of market volume with the share closing at Rs 5.90. Pan Asian Power, S M B Leasing and Richard Pieris recorded share volumes of 35.33 million, 17.80 million and 14.57 million respectively.
Point of view
The Colombo bourse remained stable during this week’s trading with both indices gaining ground compared to the downturn witnessed the previous week.
Retail investors continued to be active in the market while a few strategic investments also boosted activity levels.
We expect the current retail drive to continue into the week ahead.
Union Bank debuts in the secondary market on Tuesday and with the IPO being oversubscribed around 350 times is expected to attract investor interest.
Sound earnings reported by key growth sectors such as Plantations, Food and Beverage, Manufacturing have reiterated values for selected counters at current price levels which may renew buying interest among investors.
source - www.dailynews.lk
Sunday, March 27, 2011
Rubber prices up in Srilanka; $5/kilo projected for next year or two
COLOMBO (Commodity Online) : In Sri Lanka, natural rubber prices have recovered to chart 650 Srilankan rupees a kilo at the beginning of this week; “plantations would make millions.” was the comment of Amanda Weerasinghe, managing director of Almar Trading.
For at least the next year or two, natural rubber prices would remain at $5/kilo, expects Amanda Weerasinghe.
This is according to a report from http://www.lankabusinessonline.com .
The Japan disaster had taken rubber prices to a tail spin and at one point, was down in the abyss at 500 Srilankan rupees for TPC 1X grade.
The disaster had made automobile manufacturers there to halt operations for a while. With the countries like Thailand under selling pressure, the prices slumped and globally, traders invested in rubber bled.
But now, with demand from emerging economies for natural rubber in full throttle, the fundamentals of rubber remain strong.
Besides, the auto industry in Japan has also started functioning.
source - www.commodityonline.com
For at least the next year or two, natural rubber prices would remain at $5/kilo, expects Amanda Weerasinghe.
This is according to a report from http://www.lankabusinessonline.com .
The Japan disaster had taken rubber prices to a tail spin and at one point, was down in the abyss at 500 Srilankan rupees for TPC 1X grade.
The disaster had made automobile manufacturers there to halt operations for a while. With the countries like Thailand under selling pressure, the prices slumped and globally, traders invested in rubber bled.
But now, with demand from emerging economies for natural rubber in full throttle, the fundamentals of rubber remain strong.
Besides, the auto industry in Japan has also started functioning.
source - www.commodityonline.com
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Stock market at 1-week high amid heavy foreign outflow
* Retailers push the market; but sentiment negative
* Foreign investors exit; highest weekly outflow in 2011
* Rupee flat after rising in early trade
Sri Lanka’s stock market gained on Friday to a one-week high as retail investors snapped up select shares offsetting foreign investors’ exit from Asia’s best performing market throughout the week amid fears over higher inflation due to instability in oil-producing regions.
Foreign investors were net sellers of 303 million rupees worth of shares on Friday, extending the week’s outflow to 2.02 billion rupees, the highest so far this year. Offshore investors have sold a net 6.5 billion in 2011, after selling a record 26.4 billion in 2010.
The island’s main share index closed 0.33 percent, or 23.52 points, firmer at 7,240.27, highest since 17 March.
It hit a record closing high of 7,811.82 on 14 February.
Analysts said investor sentiment has turned negative on move by Sri Lanka’s Securities and Exchange Commission to end credit transactions by end-June and turmoil in oil-producing Middle Eastern and North African countries.
Oil was steady on Friday after heading for a third straight weekly gain. Brent crude for May shed 15 cents to $115.57 a barrel at 0837 GMT, about $4 from a 2-1/2-year high near $120 a month ago, while U.S. crude fell 20 cents to $105.40.
Sri Lanka imports all its oil, so the crises in Libya and the Middle East mean the island nation’s economy could get hit by soaring inflation and a loss of earnings from Sri Lankan expatriate workers and lower tea demand from the region.
The day’s turnover was 2.3 billion Sri Lanka rupees ($20.8 million), lower than last year’s average of 2.4 billion rupees and well below this year’s daily average of 3.3 billion.
The bourse is still Asia’s best performer so far in 2011 with a 9.1 percent gain, after bringing in the region’s best return with 96 percent last year.
Traded volume was 112.8 million, against a five-day average of 64.8 million shares. The 30-day and 90-day average trading volumes were 70.4 million and 68.7 million, respectively. Last year’s daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 14.9, one of the highest among emerging markets, compared with 12.2 in Asian markets and 11.5 in global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed steady for a fourth straight day at 110.38/40 a dollar after appreciating to 110.25/30 due to banks’ dollar selling before oil importers bought them, dealers said.
source - www.ft.lk
* Foreign investors exit; highest weekly outflow in 2011
* Rupee flat after rising in early trade
Sri Lanka’s stock market gained on Friday to a one-week high as retail investors snapped up select shares offsetting foreign investors’ exit from Asia’s best performing market throughout the week amid fears over higher inflation due to instability in oil-producing regions.
Foreign investors were net sellers of 303 million rupees worth of shares on Friday, extending the week’s outflow to 2.02 billion rupees, the highest so far this year. Offshore investors have sold a net 6.5 billion in 2011, after selling a record 26.4 billion in 2010.
The island’s main share index closed 0.33 percent, or 23.52 points, firmer at 7,240.27, highest since 17 March.
It hit a record closing high of 7,811.82 on 14 February.
Analysts said investor sentiment has turned negative on move by Sri Lanka’s Securities and Exchange Commission to end credit transactions by end-June and turmoil in oil-producing Middle Eastern and North African countries.
Oil was steady on Friday after heading for a third straight weekly gain. Brent crude for May
Sri Lanka imports all its oil, so the crises in Libya and the Middle East mean the island nation’s economy could get hit by soaring inflation and a loss of earnings from Sri Lankan expatriate workers and lower tea demand from the region.
The day’s turnover was 2.3 billion Sri Lanka rupees ($20.8 million), lower than last year’s average of 2.4 billion rupees and well below this year’s daily average of 3.3 billion.
The bourse is still Asia’s best performer so far in 2011 with a 9.1 percent gain, after bringing in the region’s best return with 96 percent last year.
Traded volume was 112.8 million, against a five-day average of 64.8 million shares. The 30-day and 90-day average trading volumes were 70.4 million and 68.7 million, respectively. Last year’s daily average volume was 67.9 million.
The bourse is trading at a forward price-to-earnings (P/E)ratio of 14.9, one of the highest among emerging markets, compared with 12.2 in Asian markets and 11.5 in global emerging markets, Thomson Reuters StarMine data showed.
The rupee closed steady for a fourth straight day at 110.38/40 a dollar after appreciating to 110.25/30 due to banks’ dollar selling before oil importers bought them, dealers said.
source - www.ft.lk
Union Bank listing opens on Tuesday
The much awaited listing of the Union Bank IPO will take place on March 29 at the Colombo Stock Exchange.Having created history with its heavily over-subscribed IPO, Union Bank plans to consolidate the momentum gained, in its plans for the future.
As the Bank enters a new phase of growth and utilizes opportunities in a post-war scenario in Sri Lanka, it remains confident of blazing new trials in a sector recognized widely as a key stake holder in the country’s burgeoning economy.
Following the IPO which was oversubscribed by an astounding 417 times in the public category and 215 times in the customer category, Union Bank was also assigned BBB and P3 by RAM Ratings Lanka, which further confirms the Bank’s stability.
The ratings are premised on the bank’s healthy capitalisation as well as adequate funding and liquidity positions. Although Union Bank is seen as a smaller bank with a limited reach, the rapidly growing branch network will strengthen the bank’s presence throughout the island. Future plans include opening of over 45 new branches by 2013, using the new capital infusion, the Union Bank CEO and Director Anil Amarasuriya said.
The innovative fund raiser which comprised three stages including a Rights Issue and a Private placement prior to the IPO was handled in an extremely efficient and meticulous manner throughout the process by the Bank and its joint managers.
Analysts maintain that the response to the Union Bank IPO was up to date the highest ever oversubscription in Sri Lanka and is easily one of the highest globally.
The investor response clearly confirmed Union Bank’s status as a Power House in banking, able to attract and retain a very high level of interest and confidence.
Union Bank’s portfolio of services covers a range of banking solutions covering SME, corporate banking, personal banking, trade and treasury services, Amarasuriya says that providing banking services to the SME sector gives them the edge in a competitive market.
“We are small enough to offer the kind of flexibility to growing SME customers’ needs and large enough to fuel their growth into big time.” Amarasuriya said.
Union Bank’s recent acquisition of Sri Lanka’s oldest asset management company National Asset Management Limited (NAMAL) highlights the fast and positive results of Union Bank’s initiatives with regard to its growth and diversification objectives.
Union Bank acquired 51 percent of NAMAL from Milford Holdings for an undisclosed sum. Other key shareholders of NAMAL are DFCC (30 percent) and Ennid Capital in which company B P De Silva Holdings (Singapore) Ltd has a majority shareholding.
Amarasuriya highlighted that the acquisition of NAMAL fits well with the Union Bank’s expansion strategy. We see future opportunities to grow the asset management and unit trust business with the positive post war economic development and capital market development.
He further stated that the acquisition will also enable the bank to offer unit trust products to the retail customer base.
With a strong product line up and recovery of non-performing loans gathering momentum, Union Bank remains confident of its own unique footprint in the banking industry.
The fact that its Rights Issue was oversubscribed by four times and its Private Placement was oversubscribed by three times, together with the phenomenal success of the IPO, speaks volumes for the public confidence placed in the bank’s ability to deliver results.
The new infusion of capital will also ensure that the Union Bank is able to meet Central Bank’s core capital requirements successfully.
source - www.dailynews.lk
Sri Lanka forestry investments not regulated: central bank
Mar 25. 2011 (LBO) - Sri Lankan companies offering forestry investments to the public are not regulated by the central bank which therefore has no supervisory role over them, a senior central bank official said.
"Tree planting is not a regulated finance business," said P Samarasiri, Assistant Governor of the Central Bank.
"Therefore, the central bank has nothing to do with it."
Samarasiri was responding to a question at a public forum organised by the regulator on the restructuring of finance companies which collapsed two years ago.
"They (forestry firms) are not registered with the central bank because they do not come within the normal financial business legislation," Samarasiri said.
"However, they are companies registered under the companies act. In any country you can have different businesses."
In recent years, a few firms offering long-term investments in forestry products like teak and sandalwood plantations have emerged.
Samarasiri said the central bank had strengthened financial sector regulations following the finance company crisis and closed loopholes in the law.
But, he added, the investing public have different "risk appetites" and should be mindful of the risks they take when investing.
"The markets have created different investment avenues (for people with different risk appetites)."
Following the collapse of finance companies, the central bank warned the public to be wary of unregulated investment schemes offering high returns, saying the higher the promised return, the higher the risk they faced.
Finance and leasing companies which form the non-bank sector face less strict regulations than banks and their risk profile is higher because of the nature of their business, Samarasiri said.
"Stakeholders approaching them bypass other institutions, so their risk appetite is also higher, although they may not say so."
source - www.lbo.lk
"Tree planting is not a regulated finance business," said P Samarasiri, Assistant Governor of the Central Bank.
"Therefore, the central bank has nothing to do with it."
Samarasiri was responding to a question at a public forum organised by the regulator on the restructuring of finance companies which collapsed two years ago.
"They (forestry firms) are not registered with the central bank because they do not come within the normal financial business legislation," Samarasiri said.
"However, they are companies registered under the companies act. In any country you can have different businesses."
In recent years, a few firms offering long-term investments in forestry products like teak and sandalwood plantations have emerged.
Samarasiri said the central bank had strengthened financial sector regulations following the finance company crisis and closed loopholes in the law.
But, he added, the investing public have different "risk appetites" and should be mindful of the risks they take when investing.
"The markets have created different investment avenues (for people with different risk appetites)."
Following the collapse of finance companies, the central bank warned the public to be wary of unregulated investment schemes offering high returns, saying the higher the promised return, the higher the risk they faced.
Finance and leasing companies which form the non-bank sector face less strict regulations than banks and their risk profile is higher because of the nature of their business, Samarasiri said.
"Stakeholders approaching them bypass other institutions, so their risk appetite is also higher, although they may not say so."
source - www.lbo.lk
Sri Lanka shares close up 0.33-pct
Mar 25, 2011 (LBO) - Sri Lankan shares closed higher Friday, extending the previous day's gains with interest seen in a cable firm and several off-the-floor deals, brokers said.
The All Share Price Index closed at 7,240.27, up 0.33 percent (23.52 points) while the more liquid Milanka index rose 0.65 percent (44.43 points) to close at 6,838.02, according to stock exchange provisional figures.
Turnover was 2.3 billion rupees.
Sierra Cables was the most actively traded stock, closing at 5.90 rupees, up 1.20, the second-highest gainer of the day, with 36.7 million shares traded.
Guardian Capital Partners was the second most actively traded stock, closing at 294.20 rupees, down 18.40 with 325,100 shares done
Central Finance was also actively traded, rising 20.40 rupees to close at 1,050 with 129,100 shares changing hands.
There were several off-the-floor deals including 314,800 Distilleries at 183 rupees each and 699,100 Aitken Spence at 163 rupees.
Distilleries ended at 185.60 rupees, up 3.10 and Spence at 163, down 50 cents, with 1.1 million shares done.
source - www.lbo.lk
The All Share Price Index closed at 7,240.27, up 0.33 percent (23.52 points) while the more liquid Milanka index rose 0.65 percent (44.43 points) to close at 6,838.02, according to stock exchange provisional figures.
Turnover was 2.3 billion rupees.
Sierra Cables was the most actively traded stock, closing at 5.90 rupees, up 1.20, the second-highest gainer of the day, with 36.7 million shares traded.
Guardian Capital Partners was the second most actively traded stock, closing at 294.20 rupees, down 18.40 with 325,100 shares done
Central Finance was also actively traded, rising 20.40 rupees to close at 1,050 with 129,100 shares changing hands.
There were several off-the-floor deals including 314,800 Distilleries at 183 rupees each and 699,100 Aitken Spence at 163 rupees.
Distilleries ended at 185.60 rupees, up 3.10 and Spence at 163, down 50 cents, with 1.1 million shares done.
source - www.lbo.lk
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