source - CAL Research
source - CAL Research
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Market Snapshot - 06.05.2013
source - CAL Research
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Sri Lanka's Dhammika Perera extends business empire
May 06, 2013 (LBO) - Dhammika Perera, head of Sri Lanka's Vallibel group who has made a series of daring acquisitions says he has effective control of nearly a tenth of listed firms in the island after buying over the latest clutch of five companies.
On Monday, Royal Ceramics Plc, a unit of listed Vallibel One Plc in which Perera owns 63.5 percent, bought a 76 percent stake in Lanka Ceramics from listed Ceylon Theatres group for 2.9 billion rupees.
In addition to Lanka Ceramics, the holding company, the acquisition brought in operating units, Lanka Walltiles, Lanka Tiles, Swisstek, an aluminum company and Horana Plantations, a tea estate.
"We now have a monopoly in ceramic tiles and aluminum industries," Perera said.
Sri Lanka's listed Hayleys group in which Perera has 44 percent, gained control of an unlisted aluminum extrusion firm Alumex, in 2010 for 2.1 billion rupees. Hayleys said at the time it had a 55 percent market share.
Perera personally owns a 29 percent stake in Lanka Alluminium, another listed company.
Royal Ceramics also owns the country's only sanitary wear producer, which is unlisted.
Perera said Horana Plantations would be a strategic fit with Talawakele and Kelani Valley Plantations of the Hayleys group.
Perera said he now had control of 28 out of 280 odd listed companies in the market.
Vallibel One has seven listed companies under its umbrella with the latest acquisitions and Hayleys group nine.
Perera also controls Vallibel Finance and Vallibel Power Erathne.
Among the more widely known material stakes in listed companies include Fortress Resorts, Pan Asia Bank and Sampath Bank.
He also owns stakes in unlisted companies in power generation and gaming.
source - www.lbo.lk![]()
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On Monday, Royal Ceramics Plc, a unit of listed Vallibel One Plc in which Perera owns 63.5 percent, bought a 76 percent stake in Lanka Ceramics from listed Ceylon Theatres group for 2.9 billion rupees.
In addition to Lanka Ceramics, the holding company, the acquisition brought in operating units, Lanka Walltiles, Lanka Tiles, Swisstek, an aluminum company and Horana Plantations, a tea estate.
"We now have a monopoly in ceramic tiles and aluminum industries," Perera said.
Sri Lanka's listed Hayleys group in which Perera has 44 percent, gained control of an unlisted aluminum extrusion firm Alumex, in 2010 for 2.1 billion rupees. Hayleys said at the time it had a 55 percent market share.
Perera personally owns a 29 percent stake in Lanka Alluminium, another listed company.
Royal Ceramics also owns the country's only sanitary wear producer, which is unlisted.
Perera said Horana Plantations would be a strategic fit with Talawakele and Kelani Valley Plantations of the Hayleys group.
Perera said he now had control of 28 out of 280 odd listed companies in the market.
Vallibel One has seven listed companies under its umbrella with the latest acquisitions and Hayleys group nine.
Perera also controls Vallibel Finance and Vallibel Power Erathne.
Among the more widely known material stakes in listed companies include Fortress Resorts, Pan Asia Bank and Sampath Bank.
He also owns stakes in unlisted companies in power generation and gaming.
source - www.lbo.lk
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In their DNA!
The duo does have a knack for it or perhaps it is in their DNA, as the market saw yet another DNA as one analyst coined it the Dhammika – Nimal Acquisition.
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Giving a major boost to the country’s corporate sentiment, which had been under gloomy weather for some time, Dhammika and Nimal yesterday effected their 18th acquisition when related parties acquired a controlling 80% stake in Lanka Ceramics Plc, from CT Holdings Plc of the Ceylon Theatres Group. High net worth investor and Director Dr. T. Senthilverl also sold his 7% stake.
The acquisition was via Royal Ceramics Plc, which picked up 76% stake along with Vallibel One (3.3%), Nimal Perera (3.3%) on his personal account, and Lanka Ceramics Chairman Anthony Page (3.3%), Dr. Sellaiah and Managing Director Rajiv Casie Chitty. Page previously had a 1.17% stake.
RCL’s acquisition of Lanka Ceramics is part of consolidating its dominant position in the ceramics tiles and bathware market in addition to wooden flooring business and packaging. With Hayleys’ and Dhammika’s interests, the Group also gets control of the aluminium industry which is booming in tandem with post-war construction spree. Additionally is the stronger foothold in rubber plantation business.
Nimal Perera told the Daily FT that after Hayleys Plc, this was the most important acquisition under the D&N combination. The duo to date has made nearly 20 acquisitions or strategic investments.
Nimal, who is the Managing Director of RCL and Chairman of Pan Asia Bank, also said that the deal was finalised within a week largely on the goodwill of and the strong ties with Anthony Page, whose was appointed to Pan Asia Bank in April 2008 even when he was serving on the Board of Lanka Ceramics.
The entire acquisition is financed by HNB, whose Acting CEO Jonathan Alles was commended by Nimal for agreeing to the deal via a call over the weekend.
Direct subsidiary of Lanka Ceramics is Lanka Walltiles Plc in which it holds 62% whilst other indirect subsidiaries are Horana Plantations Plc (17%), Ceytea Plantation Management Ltd. (33%), Lanka Floortiles Plc (34%), Uni Dil Packaging (33%), Uni Dil Paper Sacks (33%), Swisstek (Ceylon) Ltd. (23%) and Swisstek Aluminium Ltd. (20%).
RCL said in a filing to the CSE that it acquired a 76.1% stake or 22.83 million shares between Rs. 86.90 and Rs. 120 per share with bulk done at the latter price. A mandatory offer will be made by all parties acting in concert shortly. In total 26.92 million shares of Lanka Ceramics traded for Rs.3.2 billion via 419 trades with an intra-day highest price of Rs. 120 and a lowest of Rs. 82 before closing at Rs. 120, up by Rs. 40.
Lanka Ceramics’ asset per share is Rs. 17 (at Company level) and Rs. 83 (at Group level). Earnings per share is Rs. 5.47 down from Rs. 8.90 at group level at the end of third quarter of FY13. Last week Lanka Ceramic figured among the top five gainers percentage with near 18% or Rs. 12 to close at Rs. 80 though only 241,338 shares traded.
Related party Lanka Floortiles Plc closed up by Rs. 4 to Rs. 69 after hitting a peak of Rs. 70.
Investors also toasted RCL in anticipation of major boost with its share price up by Rs. 3.30 to Rs. 100.50 whilst the share touched an intra-day high of Rs. 105. Horana Plantations gained by Rs. 2.30 to Rs. 28.30 with a peak of Rs. 29.80. Seller CT Holdings saw its share price jump by Rs. 8.70 to Rs. 148.20 after peaking to Rs. 150.
In the first nine months of FY13, Group turnover rose by 22% to Rs. 8.8 billion whilst profit from operations was up 17% to Rs. 1.08 billion. After tax profit was Rs. 525 million, down by 5% and profit attributable to equity holders of Lanka Ceramics was Rs. 164 million, down by 39%.
Lanka Ceramics Group assets as at 31 December 2012 was Rs. 14.3 billion, up from Rs. 12.3 billion a year earlier and Rs. 13 billion as at 31 March 2012.
Capital and reserves were Rs. 7 billion including Rs. 1.6 billion in retained profits. Liabilities amounted to Rs. 4.4 billion including Rs. 3 billion in non-current.
In FY13, Lanka Ceramics has obtained a loan amounting to Rs. 610 million from the Parent Company (C T Holdings) at the rate of interest 10% p.a. which was utilised for the purchase of Lanka Walltile PLC shares.
The Company in FY12 recorded a profit after tax of Rs. 71.4 million, a marginal decrease from the Rs. 73.7m reported in the previous financial year. The decrease was due to the sharp increase in financial costs incurred during the latter part of the year on account of investment in its subsidiary.
The Group recorded a consolidated profit attributable to shareholder of Rs. 522.7 million. This was a significant increase over that reported in the previous year of Rs. 254.9 million.
source - www.ft.lk![]()
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Giving a major boost to the country’s corporate sentiment, which had been under gloomy weather for some time, Dhammika and Nimal yesterday effected their 18th acquisition when related parties acquired a controlling 80% stake in Lanka Ceramics Plc, from CT Holdings Plc of the Ceylon Theatres Group. High net worth investor and Director Dr. T. Senthilverl also sold his 7% stake.
The acquisition was via Royal Ceramics Plc, which picked up 76% stake along with Vallibel One (3.3%), Nimal Perera (3.3%) on his personal account, and Lanka Ceramics Chairman Anthony Page (3.3%), Dr. Sellaiah and Managing Director Rajiv Casie Chitty. Page previously had a 1.17% stake.
RCL’s acquisition of Lanka Ceramics is part of consolidating its dominant position in the ceramics tiles and bathware market in addition to wooden flooring business and packaging. With Hayleys’ and Dhammika’s interests, the Group also gets control of the aluminium industry which is booming in tandem with post-war construction spree. Additionally is the stronger foothold in rubber plantation business.
Nimal Perera told the Daily FT that after Hayleys Plc, this was the most important acquisition under the D&N combination. The duo to date has made nearly 20 acquisitions or strategic investments.
Nimal, who is the Managing Director of RCL and Chairman of Pan Asia Bank, also said that the deal was finalised within a week largely on the goodwill of and the strong ties with Anthony Page, whose was appointed to Pan Asia Bank in April 2008 even when he was serving on the Board of Lanka Ceramics.
The entire acquisition is financed by HNB, whose Acting CEO Jonathan Alles was commended by Nimal for agreeing to the deal via a call over the weekend.
Direct subsidiary of Lanka Ceramics is Lanka Walltiles Plc in which it holds 62% whilst other indirect subsidiaries are Horana Plantations Plc (17%), Ceytea Plantation Management Ltd. (33%), Lanka Floortiles Plc (34%), Uni Dil Packaging (33%), Uni Dil Paper Sacks (33%), Swisstek (Ceylon) Ltd. (23%) and Swisstek Aluminium Ltd. (20%).
RCL said in a filing to the CSE that it acquired a 76.1% stake or 22.83 million shares between Rs. 86.90 and Rs. 120 per share with bulk done at the latter price. A mandatory offer will be made by all parties acting in concert shortly. In total 26.92 million shares of Lanka Ceramics traded for Rs.3.2 billion via 419 trades with an intra-day highest price of Rs. 120 and a lowest of Rs. 82 before closing at Rs. 120, up by Rs. 40.
Lanka Ceramics’ asset per share is Rs. 17 (at Company level) and Rs. 83 (at Group level). Earnings per share is Rs. 5.47 down from Rs. 8.90 at group level at the end of third quarter of FY13. Last week Lanka Ceramic figured among the top five gainers percentage with near 18% or Rs. 12 to close at Rs. 80 though only 241,338 shares traded.
Related party Lanka Floortiles Plc closed up by Rs. 4 to Rs. 69 after hitting a peak of Rs. 70.
Investors also toasted RCL in anticipation of major boost with its share price up by Rs. 3.30 to Rs. 100.50 whilst the share touched an intra-day high of Rs. 105. Horana Plantations gained by Rs. 2.30 to Rs. 28.30 with a peak of Rs. 29.80. Seller CT Holdings saw its share price jump by Rs. 8.70 to Rs. 148.20 after peaking to Rs. 150.
In the first nine months of FY13, Group turnover rose by 22% to Rs. 8.8 billion whilst profit from operations was up 17% to Rs. 1.08 billion. After tax profit was Rs. 525 million, down by 5% and profit attributable to equity holders of Lanka Ceramics was Rs. 164 million, down by 39%.
Lanka Ceramics Group assets as at 31 December 2012 was Rs. 14.3 billion, up from Rs. 12.3 billion a year earlier and Rs. 13 billion as at 31 March 2012.
Capital and reserves were Rs. 7 billion including Rs. 1.6 billion in retained profits. Liabilities amounted to Rs. 4.4 billion including Rs. 3 billion in non-current.
In FY13, Lanka Ceramics has obtained a loan amounting to Rs. 610 million from the Parent Company (C T Holdings) at the rate of interest 10% p.a. which was utilised for the purchase of Lanka Walltile PLC shares.
The Company in FY12 recorded a profit after tax of Rs. 71.4 million, a marginal decrease from the Rs. 73.7m reported in the previous financial year. The decrease was due to the sharp increase in financial costs incurred during the latter part of the year on account of investment in its subsidiary.
The Group recorded a consolidated profit attributable to shareholder of Rs. 522.7 million. This was a significant increase over that reported in the previous year of Rs. 254.9 million.
source - www.ft.lk
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Sri Lanka stocks extend gains
May 07, 2013 (LBO) – Sri Lanka's stocks closed up 1.4 percent Tuesday, on the back of a 1.8 percent gain a day earlier driven by interest in banking and diversified holdings companies, brokers said.
The benchmark Colombo All Share Index closed 80.51 points higher at 6,201.68 up 1.32 percent and the S&P SL 20 Index closed 50.83 points higher at 3,511.95 up 1.47 percent. Colombo stocks are now at 17 month highs.
Turnover was 1.38 billion rupees with 54.4 million shares changing hands and foreign buying accounting for 14.3 percent of the day’s market activity.
Foreigners bought 322 million rupees of shares and sold 74 million rupees worth in a day that 165 stocks advanced and 48 stocks retreated.
Diversified Aitken Spence closed up 9.60 at 138.30, JKH extended rose 4.30 to 264.50 rupees and Vallibel One rose 2.30 to 21.40 rupees following yesterday's take-over of the Lanka Ceramics group contributing most to the index gain.
Lanka Floor Tiles rose 1.20 rupees 70.20 rupees, Lanka Walltiles closed up 2.0 rupees at 67.00 rupees.
Colombo Land & Development and Textured Jersey were the heavily traded stocks during the day.
Textured Jersey Limited said net profits for the March 2013 quarter rose 47 percent to 321 million rupees, helped by tighter cost controls and net finance income. The firm reported earnings of 49 cents per share for the quarter, in accounts filed with the CSE.
In the banking sector, Sampath Bank gained 5.00 rupees to close at 222.10 while DFCC gained 6.60 rupees closing at 150.00.10.
Ceylon Tobacco Company gained 4.00 rupees to close at 825.00 and The Lion Brewery Ceylon closed at 510.00 rupees up 3.70 rupees.
The market price earnings ratio on historical proifts is now 16.8 times up from 16.5 times on Monday with stock values climbing 31 billion rupees to 2,377 billion rupees.
source - www.lbo.lk
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The benchmark Colombo All Share Index closed 80.51 points higher at 6,201.68 up 1.32 percent and the S&P SL 20 Index closed 50.83 points higher at 3,511.95 up 1.47 percent. Colombo stocks are now at 17 month highs.
Turnover was 1.38 billion rupees with 54.4 million shares changing hands and foreign buying accounting for 14.3 percent of the day’s market activity.
Foreigners bought 322 million rupees of shares and sold 74 million rupees worth in a day that 165 stocks advanced and 48 stocks retreated.
Diversified Aitken Spence closed up 9.60 at 138.30, JKH extended rose 4.30 to 264.50 rupees and Vallibel One rose 2.30 to 21.40 rupees following yesterday's take-over of the Lanka Ceramics group contributing most to the index gain.
Lanka Floor Tiles rose 1.20 rupees 70.20 rupees, Lanka Walltiles closed up 2.0 rupees at 67.00 rupees.
Colombo Land & Development and Textured Jersey were the heavily traded stocks during the day.
Textured Jersey Limited said net profits for the March 2013 quarter rose 47 percent to 321 million rupees, helped by tighter cost controls and net finance income. The firm reported earnings of 49 cents per share for the quarter, in accounts filed with the CSE.
In the banking sector, Sampath Bank gained 5.00 rupees to close at 222.10 while DFCC gained 6.60 rupees closing at 150.00.10.
Ceylon Tobacco Company gained 4.00 rupees to close at 825.00 and The Lion Brewery Ceylon closed at 510.00 rupees up 3.70 rupees.
The market price earnings ratio on historical proifts is now 16.8 times up from 16.5 times on Monday with stock values climbing 31 billion rupees to 2,377 billion rupees.
source - www.lbo.lk
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Bourse continues to surge; Rupee strengthens, bond yields mixed
The Colombo bourse continued to surge ahead on Tuesday (07) with the All Share Price Index gaining 80.51 points to close 1.32 percent higher at 6,201.68.
Year-to-date, the Colombo Stock Exchange has grown 9.9 percent.
The S&P SL20 closed 1.47 percent higher, gaining 50.83 points to 3,511.95. Year-to-date the index was up 13.83 percent.
Turnover dipped from the previous day’s Rs. 4.1 billion to Rs. 1.38 billion.
Foreign purchases amounted to Rs. 322.47 million, leading to a net inflow Rs. 248.78 million.
"Positive sentiment continued to push the indices higher amid strong activity levels centred on banking, finance, diversified and manufacturing counters accounting for over 75% of turnover," John Keells Stockbrokers said.
Vallibel One saw more than six million shares change hands during the day closing 12.04 percent higher at Rs. 21.40 while SEYB saw 2.5 million shares traded before closing at Rs. 40.30, up 1.77 percent.
Commercial Bank closed at 118.50, up 0.51 percent after 847,473 shares changed hands while NDB closed at Rs. 180 on 480,439 shares traded, up 2.92 percent from the previous day’s close.
HNB saw more than 388 thousand shares change hands before closing 0.89 percent higher at Rs. 170.
More than a million Colombo Land stocks were traded, closing 3.77 percent higher at Rs. 55.
"Gains made in Aitken Spence, John Keells Holdings, Vallibel One and DFCC weighted heavily on the index. With blue chips driving the market, the S&P SL20 also recorded heavy gaining rushing up 51 points," Softlogic Equity Research said.
"Vallibel One tops turnover: Interest in Vallibel One has been high in the last few days, while activity in the counter accelerated following the acquisition by its subsidiary Royal Ceramics. The counter recorded 6.1mn shares changing hands as it traded between LKR19.3 and LKR21.8 and closing on the high side at LKR21.4 gaining 12.0%. Royal Ceramics continued to remain active gaining 3.5% to close at LKR104.0," it said.
Meanwhile, the rupee closed at Rs. 126.30/35 against the US dollar yesterday (07), strengthening from an opening position of Rs.126.40/60, currency dealers said.
Activity in the secondary market for Treasury bonds was buoyant ahead of today’s primary market auction of Treasury bills.
The more liquid five year Treasury bond saw its yield ease marginally to 11.32/35 percent from 11.35/37 percent while the one year yield dipped to 11.10/25 percent from 11.15/25 percent.
The four year bond yield dipped to 11.05/15 percent from 11.18/25 percent.
The eight year bond yield increased marginally to 11.85/88 percent from 11.83/85 percent while the three year bond yield tightened to 11.24/26 percent from 11.22/28 percent.
source - www.island.lk![]()
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Year-to-date, the Colombo Stock Exchange has grown 9.9 percent.
The S&P SL20 closed 1.47 percent higher, gaining 50.83 points to 3,511.95. Year-to-date the index was up 13.83 percent.
Turnover dipped from the previous day’s Rs. 4.1 billion to Rs. 1.38 billion.
Foreign purchases amounted to Rs. 322.47 million, leading to a net inflow Rs. 248.78 million.
"Positive sentiment continued to push the indices higher amid strong activity levels centred on banking, finance, diversified and manufacturing counters accounting for over 75% of turnover," John Keells Stockbrokers said.
Vallibel One saw more than six million shares change hands during the day closing 12.04 percent higher at Rs. 21.40 while SEYB saw 2.5 million shares traded before closing at Rs. 40.30, up 1.77 percent.
Commercial Bank closed at 118.50, up 0.51 percent after 847,473 shares changed hands while NDB closed at Rs. 180 on 480,439 shares traded, up 2.92 percent from the previous day’s close.
HNB saw more than 388 thousand shares change hands before closing 0.89 percent higher at Rs. 170.
More than a million Colombo Land stocks were traded, closing 3.77 percent higher at Rs. 55.
"Gains made in Aitken Spence, John Keells Holdings, Vallibel One and DFCC weighted heavily on the index. With blue chips driving the market, the S&P SL20 also recorded heavy gaining rushing up 51 points," Softlogic Equity Research said.
"Vallibel One tops turnover: Interest in Vallibel One has been high in the last few days, while activity in the counter accelerated following the acquisition by its subsidiary Royal Ceramics. The counter recorded 6.1mn shares changing hands as it traded between LKR19.3 and LKR21.8 and closing on the high side at LKR21.4 gaining 12.0%. Royal Ceramics continued to remain active gaining 3.5% to close at LKR104.0," it said.
Meanwhile, the rupee closed at Rs. 126.30/35 against the US dollar yesterday (07), strengthening from an opening position of Rs.126.40/60, currency dealers said.
Activity in the secondary market for Treasury bonds was buoyant ahead of today’s primary market auction of Treasury bills.
The more liquid five year Treasury bond saw its yield ease marginally to 11.32/35 percent from 11.35/37 percent while the one year yield dipped to 11.10/25 percent from 11.15/25 percent.
The four year bond yield dipped to 11.05/15 percent from 11.18/25 percent.
The eight year bond yield increased marginally to 11.85/88 percent from 11.83/85 percent while the three year bond yield tightened to 11.24/26 percent from 11.22/28 percent.
source - www.island.lk
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Bourse at 1-1/2-year high on blue chips, retail buying
Reuters: Shares closed at their highest in nearly 1-1/2 years on Tuesday, led by blue chips, due to an improved appetite for risky assets after heavy foreign buying amid hopes of a rate cut at the Central Bank’s policy meeting later this week.
The main stock index rose 1.32%, or 80.51 points, to 6,201.68, the highest close since 14 November 2011.
“Investors are upbeat after foreign investors have been buying continuously. Retail investors are also on the buying side as they hope for a rate cut on Friday,” a stockbroker said on condition of anonymity.
Shares have been on a rising trend on expectations of a fall in interest rates after Treasury Secretary Dr. P.B. Jayasundera and the Central Bank said interest rates could ease in May-June.
The market has gained 7.3% since the Treasury Secretary’s comments on 9 April.
The International Monetary Fund, however, said on Thursday Sri Lanka must not loosen monetary conditions as inflation remains a concern, even though prices had risen at a slower pace in April than the previous month.
Shares in market heavyweight John Keells Holdings rose 1.65% to Rs. 264.50 a share.
The turnover was Rs. 1.39 billion ($ 11 million), more than this year’s daily average of Rs. 1 billion.
Foreign investors were net buyers of Rs. 248.8 million of shares, extending the net foreign inflow so far this year to Rs. 9.21 billion. Last year, the Bourse saw a net inflow of $ 303 million.
The rupee ended at 126.30/37 per dollar, firmer from Monday’s close of 126.40/50, on exporter dollar sales, said currency dealers.
source - www.ft.lk![]()
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The main stock index rose 1.32%, or 80.51 points, to 6,201.68, the highest close since 14 November 2011.
“Investors are upbeat after foreign investors have been buying continuously. Retail investors are also on the buying side as they hope for a rate cut on Friday,” a stockbroker said on condition of anonymity.
Shares have been on a rising trend on expectations of a fall in interest rates after Treasury Secretary Dr. P.B. Jayasundera and the Central Bank said interest rates could ease in May-June.
The market has gained 7.3% since the Treasury Secretary’s comments on 9 April.
The International Monetary Fund, however, said on Thursday Sri Lanka must not loosen monetary conditions as inflation remains a concern, even though prices had risen at a slower pace in April than the previous month.
Shares in market heavyweight John Keells Holdings rose 1.65% to Rs. 264.50 a share.
The turnover was Rs. 1.39 billion ($ 11 million), more than this year’s daily average of Rs. 1 billion.
Foreign investors were net buyers of Rs. 248.8 million of shares, extending the net foreign inflow so far this year to Rs. 9.21 billion. Last year, the Bourse saw a net inflow of $ 303 million.
The rupee ended at 126.30/37 per dollar, firmer from Monday’s close of 126.40/50, on exporter dollar sales, said currency dealers.
source - www.ft.lk
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T-bill yields down, bourse surge eases
The Central Bank accepted bids amounting to Rs. 16 billion at yesterday’s (08) primary market auction of Treasury bills amounting to Rs. 12 billion with yields easing across the board.
The three-month Treasury bill yields eased to 9.18 percent, down two basis points from last week while the six month yield eased to 10.20 percent from 10.22 percent the previous week. The twelve month yield eased 4bps to 11.29 percent.
Total bids amounted to Rs. 39.44 billion.
Meanwhile, Central Bank Treasury bill holdings have declined to Rs. 93.5 billion yesterday from Rs. 163.3 billion as at end December 2012. The holdings, representing money printed for the government reached a low Rs. 83.9 on April 29, 2013, before building up to Rs. 101.1 billion on May 03, and declining again thereafter.
The upsurge at the Colombo bourse eased on Wednesday with the All Share Price Index gaining 8.42 points to close at 6,210.10, up 0.14 percent.
The S&P SL20 closed 0.27 percent higher, gaining 9.35 points to 3,521.3.
Turnover reached Rs. 1,465.4 million.
Foreign purchases amounted to Rs. 308.35 million, but with heavier foreign selling a net outflow of Rs. 92.13 million was seen.
ASIR (five million shares at Rs. 15.50) and COMB (two million shares at Rs. 118) featured in off market transactions during the day.
"The ASPI ended higher amid sustained buying interest in selected large and mid-cap counters. Market turnover remained above Rs.1bn for a third consecutive day and was dominated by trades on banking and diversified counters, with COMB, JKH, and VONE collectively accounting for roughly 40% of turnover," John Keells Stockbrokers said.
"Gainers matched losers with Capital Alliance, Lanka Ashok and Ceylinco Insurance advancing by 19.0%, 11.9% and 10.0% offsetting declines in Selinsing, Harischandra Mills and Gestetner which fell by 19.7%, 12.5% and 11.0% respectively," DNH Financial said.
source - www.island.lk![]()
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The three-month Treasury bill yields eased to 9.18 percent, down two basis points from last week while the six month yield eased to 10.20 percent from 10.22 percent the previous week. The twelve month yield eased 4bps to 11.29 percent.
Total bids amounted to Rs. 39.44 billion.
Meanwhile, Central Bank Treasury bill holdings have declined to Rs. 93.5 billion yesterday from Rs. 163.3 billion as at end December 2012. The holdings, representing money printed for the government reached a low Rs. 83.9 on April 29, 2013, before building up to Rs. 101.1 billion on May 03, and declining again thereafter.
The upsurge at the Colombo bourse eased on Wednesday with the All Share Price Index gaining 8.42 points to close at 6,210.10, up 0.14 percent.
The S&P SL20 closed 0.27 percent higher, gaining 9.35 points to 3,521.3.
Turnover reached Rs. 1,465.4 million.
Foreign purchases amounted to Rs. 308.35 million, but with heavier foreign selling a net outflow of Rs. 92.13 million was seen.
ASIR (five million shares at Rs. 15.50) and COMB (two million shares at Rs. 118) featured in off market transactions during the day.
"The ASPI ended higher amid sustained buying interest in selected large and mid-cap counters. Market turnover remained above Rs.1bn for a third consecutive day and was dominated by trades on banking and diversified counters, with COMB, JKH, and VONE collectively accounting for roughly 40% of turnover," John Keells Stockbrokers said.
"Gainers matched losers with Capital Alliance, Lanka Ashok and Ceylinco Insurance advancing by 19.0%, 11.9% and 10.0% offsetting declines in Selinsing, Harischandra Mills and Gestetner which fell by 19.7%, 12.5% and 11.0% respectively," DNH Financial said.
source - www.island.lk
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Sri Lanka cuts rate to spur growth
Sri Lanka’s Central Bank reduced policy rates by 50 basis points to stimulate growth. Accordingly the repurchase rate will be placed at 7 percent and the reverse repurchase rate at 9 percent.
In addition, the reserve maintenance period of commercial banks will also be increased to two weeks from one week with effect from June 1, 2013 in order to offer greater flexibility to commercial banks in managing their liquidity.
source - www.dailymirror.lk/
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Market Snapshot - 10 05 2013
source - CAL Research
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Weekly Foreign Holding Update - 10 05 2013
source - CAL Research
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Weekly Foreign Holding Update - 10 05 2013 - By Acuity
(click image to enlarge)
source - acuity research
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Sri Lanka Stock Picks Forum
Sri Lanka Stock picks one of the oldest blogs in the country which is involved in publishing updates, news articles, research reports etc. with regard to day to day happenings/activities of the Colombo Stock Exchange is proud to announce that the launching of their forum titled as "Sri lanka Stock picks - forum".
Sri lanka stock picks invites its members and others to make use of this opportunity to share their views, matters, in relation to the activities of the Colombo Stock Exchange in a professional manner.
It is purely the responsibility of the publisher of any post to provide us valid reasons/supporting documents (eg: publish reports, paper articles, links etc....) to justify your comments since this forum is open to the general public.
You can access the forum - http://srilankastockpicks.freeforums.biz/
Wishing you all the best.
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Results Update - March Quarter 2013
(click image to enlarge)
source - CAL Research
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Bourse gains sharply
Stock Market Review for the Week Ended 10th May 2013:
The bourse had a good week with the All Share Price Index gaining a sharp 3.94 percent and the S&P SL20 gaining 3.67 percent.
Year-to-date, the bourse closed last week 10.76 higher while the S&P SL20 did better at 14.44 percent.
A net foreign inflow of Rs. 663.97 was reported during the week, taking up the total net inflow to Rs. 9,597.86 million.
Markets opened on Monday displaying a bullish sentiment with the change in ownership of Lanka Ceramics was the highlight of the day. The share gained a 50% as the capital gain of the selling party, CT Holdings amounts to c.Rs. 2.0bn. Royal Ceramic was the buying party to the transaction (76.1% stake of the Lanka Ceramic). On the back of that move, the market closed on a positive territory with a turnover of Rs 4.1 Bn. ASI gained 107.99 points (1.80%) to close at 6,121.17 and the more liquid S&P SL20 index gained 55.13 points (1.62%) to close at 3,461.12. Top contributors to turnover were Lanka Ceramic with Rs. 3.2Bn, Royal Ceramics 65.2Mn and John Keells Holdings with Rs. 42.5Mn.
Most active counters for the day were Vallibel One, nation Lanka Finance and Lanka Ceramics. Further, blue-chip such as Nestle, John Keells, Dialog Axiata, Chevron Lubricants and National Development Bank reached 52week high prices on Monday aiding the positive performance for the day. Foreign participation accounted for 3% of the total market turnover as net buyers; with a total net foreign inflow of LKR 28.2mn.
Shares closed at their highest in almost 18 months on Tuesday primarily led by blue-chip counters as a result of heavy foreign buying as well as due to strong anticipation of a rate cut by the Central Bank’s policy meeting this week. The Bourse closed surpassing 6,200 levels as 20 stocks reached 52 week high prices including high-cap Aitken Spence up by LKR 7.80, Chevron Lubricants up by LKR 2.90, Nestle up by LKR 4.90, John Keells Holdings up by LKR 4.60, DFCC Bank up by LKR 6.50 and National Development Bank up by LKR 5.00. On this backdrop, the ASI gained 80.51 index points (1.32%) to close at 6,201.68 and S&P SL 20 Index advanced by 50.83 index points (1.47%) to close at 3,511.95. Top contributors to the turnover were Vallibel One with LKR 127.0mn, Seylan Bank non-voting with LKR 100.0mn and Commercial Bank with LKR 99.9mn. Daily market turnover was at LKR 1.4bn as foreign participation for the day amounted to 14.3% of the total market activity. A net foreign inflow of LKR 248.8mn was recorded for the day extending the net foreign inflow for this year to Rs 9.21 Bn.
On Wednesday, the market maintained its positive momentum with retail counters rallying around blue-chips to secure positivity. The main index ASI gained 8.42 points (0.14%) to close at 6,210.10 and the S&P SL20 index gained 9.35 points (0.27%) to close at 3,521.30 while a turnover of Rs. 1,465.4Mn was recorded for the day. Crossings took place in Commercial Bank, boosting the turnover while the share price closed at LKR 118.70 gaining 0.17%. Bank Finance and Insurance sector contributed mostly to the market turnover while the sector index was up by 0.37%. Consequently, top contributors to turnover were Commercial Bank with Rs. 371.6Mn, Vallibel One with Rs. 114.0Mn and John Keells Holdings with Rs. 105.1Mn while the most active counters for the day were Vallibel One, Pan Asia Bank and Capital Alliance Finance. Foreign investors reversed their sentiment by being net sellers on Wednesday, while the net foreign outflows amounted to LKR 93 Mn.
Shares gained for the sixth straight session on Thursday to hit a new 18 month high backed by strong performance in the banking sector in anticipation of a rate cut. The ASI gained 28.61 points (+0.5%) to close at 18 month high of 6,238.71. S&P SL 20 index closed at 3,526.51 with gain of 5.21 points (+0.2%). Investor anticipation over a policy rate rate reduction drove the activity levels across the board and the market turnover reached Rs. 2.1bn. Crossings were witnessed on several counters, namely Commercial Bank, HNB, NDB and Distilleries while strong retail activity was taking place in Touchwood, NTB and Capital Alliance Finance. Commercial Bank foreign stake was reduced by 2,677,198 shares while the share price closed at LKR 118.50. Accordingly, Bank, Finance and Insurance sector contributed mostly to the market turnover while the sector index rose by 1.16%.
Foreign participation accounted for 26% of the market activity as foreigners were net buyers with a net foreign inflow of Rs.194.1mn.
On a decisive move, the Central Bank of Sri Lanka cut policy rates by 50bps on Friday as anticipated by investors throughout the week. On this backdrop, the main share ASI index gained 11.29 points (+0.18%) to close at 6,250 points while the more liquid S & P SL index gained 4.39 points (+0.12%) to close at 3,530.90 points. This positive investor sentiment drove the main ASI index up more than 225 points this week. Turnover for the day was at Rs 1.472 Bn as several crossings were recorded on Commercial Bank, Distilleries and The Lion Brewery Ceylon. Beverage, Food and Tobacco sector contributed mostly to the market turnover posting a rise in sector by 47.30 points while on the contrary; Bank, Finance and Insurance sector suffered a decline of 13.15 points. Foreigners were active buyers for the day with a net foreign inflow of Rs 285 Mn.
In the backdrop of this prevailing positive market sentiment, we are particularly bullish on Access Engineering, Vallibel One and a few counters in the Banking sector. Having strong growth rates Access Engineering is geared up to perform on solid price levels. Vallibel One was recorded as one of the top traded shares this week as well as a top contributor to daily turnovers throughout the week after closing at Rs 20.60 on Friday. The Banking sector in particular, Commercial Bank, HNB and NTB recorded several crossings this week with strong retail and foreign activity focused on these counters. The Banking sector with a sector PE of close to 9x (last 4 Quarters) as well as Central Bank’s easing of the Monetary Policy poses a fairly confident drive ahead.
(Courtesy: Innovest Investments Pvt. Ltd – an Investment Management Company licensed by the Securities & Exchange Commission of Sri Lanka)
source - www.island.lk
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The bourse had a good week with the All Share Price Index gaining a sharp 3.94 percent and the S&P SL20 gaining 3.67 percent.
Year-to-date, the bourse closed last week 10.76 higher while the S&P SL20 did better at 14.44 percent.
A net foreign inflow of Rs. 663.97 was reported during the week, taking up the total net inflow to Rs. 9,597.86 million.
Markets opened on Monday displaying a bullish sentiment with the change in ownership of Lanka Ceramics was the highlight of the day. The share gained a 50% as the capital gain of the selling party, CT Holdings amounts to c.Rs. 2.0bn. Royal Ceramic was the buying party to the transaction (76.1% stake of the Lanka Ceramic). On the back of that move, the market closed on a positive territory with a turnover of Rs 4.1 Bn. ASI gained 107.99 points (1.80%) to close at 6,121.17 and the more liquid S&P SL20 index gained 55.13 points (1.62%) to close at 3,461.12. Top contributors to turnover were Lanka Ceramic with Rs. 3.2Bn, Royal Ceramics 65.2Mn and John Keells Holdings with Rs. 42.5Mn.
Most active counters for the day were Vallibel One, nation Lanka Finance and Lanka Ceramics. Further, blue-chip such as Nestle, John Keells, Dialog Axiata, Chevron Lubricants and National Development Bank reached 52week high prices on Monday aiding the positive performance for the day. Foreign participation accounted for 3% of the total market turnover as net buyers; with a total net foreign inflow of LKR 28.2mn.
Shares closed at their highest in almost 18 months on Tuesday primarily led by blue-chip counters as a result of heavy foreign buying as well as due to strong anticipation of a rate cut by the Central Bank’s policy meeting this week. The Bourse closed surpassing 6,200 levels as 20 stocks reached 52 week high prices including high-cap Aitken Spence up by LKR 7.80, Chevron Lubricants up by LKR 2.90, Nestle up by LKR 4.90, John Keells Holdings up by LKR 4.60, DFCC Bank up by LKR 6.50 and National Development Bank up by LKR 5.00. On this backdrop, the ASI gained 80.51 index points (1.32%) to close at 6,201.68 and S&P SL 20 Index advanced by 50.83 index points (1.47%) to close at 3,511.95. Top contributors to the turnover were Vallibel One with LKR 127.0mn, Seylan Bank non-voting with LKR 100.0mn and Commercial Bank with LKR 99.9mn. Daily market turnover was at LKR 1.4bn as foreign participation for the day amounted to 14.3% of the total market activity. A net foreign inflow of LKR 248.8mn was recorded for the day extending the net foreign inflow for this year to Rs 9.21 Bn.
On Wednesday, the market maintained its positive momentum with retail counters rallying around blue-chips to secure positivity. The main index ASI gained 8.42 points (0.14%) to close at 6,210.10 and the S&P SL20 index gained 9.35 points (0.27%) to close at 3,521.30 while a turnover of Rs. 1,465.4Mn was recorded for the day. Crossings took place in Commercial Bank, boosting the turnover while the share price closed at LKR 118.70 gaining 0.17%. Bank Finance and Insurance sector contributed mostly to the market turnover while the sector index was up by 0.37%. Consequently, top contributors to turnover were Commercial Bank with Rs. 371.6Mn, Vallibel One with Rs. 114.0Mn and John Keells Holdings with Rs. 105.1Mn while the most active counters for the day were Vallibel One, Pan Asia Bank and Capital Alliance Finance. Foreign investors reversed their sentiment by being net sellers on Wednesday, while the net foreign outflows amounted to LKR 93 Mn.
Shares gained for the sixth straight session on Thursday to hit a new 18 month high backed by strong performance in the banking sector in anticipation of a rate cut. The ASI gained 28.61 points (+0.5%) to close at 18 month high of 6,238.71. S&P SL 20 index closed at 3,526.51 with gain of 5.21 points (+0.2%). Investor anticipation over a policy rate rate reduction drove the activity levels across the board and the market turnover reached Rs. 2.1bn. Crossings were witnessed on several counters, namely Commercial Bank, HNB, NDB and Distilleries while strong retail activity was taking place in Touchwood, NTB and Capital Alliance Finance. Commercial Bank foreign stake was reduced by 2,677,198 shares while the share price closed at LKR 118.50. Accordingly, Bank, Finance and Insurance sector contributed mostly to the market turnover while the sector index rose by 1.16%.
Foreign participation accounted for 26% of the market activity as foreigners were net buyers with a net foreign inflow of Rs.194.1mn.
On a decisive move, the Central Bank of Sri Lanka cut policy rates by 50bps on Friday as anticipated by investors throughout the week. On this backdrop, the main share ASI index gained 11.29 points (+0.18%) to close at 6,250 points while the more liquid S & P SL index gained 4.39 points (+0.12%) to close at 3,530.90 points. This positive investor sentiment drove the main ASI index up more than 225 points this week. Turnover for the day was at Rs 1.472 Bn as several crossings were recorded on Commercial Bank, Distilleries and The Lion Brewery Ceylon. Beverage, Food and Tobacco sector contributed mostly to the market turnover posting a rise in sector by 47.30 points while on the contrary; Bank, Finance and Insurance sector suffered a decline of 13.15 points. Foreigners were active buyers for the day with a net foreign inflow of Rs 285 Mn.
In the backdrop of this prevailing positive market sentiment, we are particularly bullish on Access Engineering, Vallibel One and a few counters in the Banking sector. Having strong growth rates Access Engineering is geared up to perform on solid price levels. Vallibel One was recorded as one of the top traded shares this week as well as a top contributor to daily turnovers throughout the week after closing at Rs 20.60 on Friday. The Banking sector in particular, Commercial Bank, HNB and NTB recorded several crossings this week with strong retail and foreign activity focused on these counters. The Banking sector with a sector PE of close to 9x (last 4 Quarters) as well as Central Bank’s easing of the Monetary Policy poses a fairly confident drive ahead.
(Courtesy: Innovest Investments Pvt. Ltd – an Investment Management Company licensed by the Securities & Exchange Commission of Sri Lanka)
source - www.island.lk
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Haycarb PAT exceeds Rs. 1bn
Haycarb PLC, coconut shell based activated carbon manufacturer and exporter, posted a record performance in the financial year 2012/13.
"Outpacing growing challenges in traditional markets and rising costs of production, the Hayleys Group’s multinational activated carbon business noted significant achievement of several key performance milestones in an interim statement filed with the Colombo Stock Exchange," the company said in a statement.
Haycarb in 2012/13 recorded revenue of Rs. 10.1 billion, up from Rs. 8.5 billion in the previous financial year. Significantly, the company posted profit before tax of Rs. 1.22 billion and profit after tax of Rs. 1.03billion compared to Rs. 657 million and Rs. 523 million in the preceding year.
Earnings per share of equity holders of the company doubled to Rs. 31.50, compared to the previous financial year. Haycarb, the pioneer manufacturer of activated carbon in any coconut producing country, with manufacturing facilities in Sri Lanka, Thailand and Indonesia supported by marketing offices in the UK, Australia and USA, contributed significantly to the national economy through foreign exchange earnings in excess of Rs. 5 billion whilst increasing emphasis in product innovation, market development and substantial investments in expanding its global manufacturing footprint.
Haycarb PLC and Hayleys PLC Chairman, Mohan Pandithage stated that the company has posted exceptional results to surpass Rs. One billion in profit after tax in spite of the economic slowdown that affected some of the major export markets. "The strong customer relationships we have nurtured based on mutual trust and our good governance principles assisted the company to retain key customers, and the successful market penetration strategies, enabled the company to operate at full capacity, a key driver that contributed to sustain and grow its performance" he said.
Haycarb PLC Managing Director Rajitha Kariyawasan attributed concentrated efforts on marketing, sales and new business development, emphasis on driving high margin and value added products, full capacity operations together with extensive programs on waste reduction and productivity enhancements as key to the year-end performance. "Despite contraction and stagnation of demand from our traditional markets, our sales teams and active distributorships worked aggressively to expand our market share. We also had to overcome other external challenges of rising fuel costs, wage costs and overheads".
During the year, Haycarb manufacturing operations in Sri Lanka, Indonesia and Thailand recorded exceptional performances, with some achieving the best results in their history. "Our marketing subsidiaries in Europe, Australia and in the USA brought in worthwhile contributions to both top and bottom lines", Kariyawasan stated.
"The relative stability of pricing of our key raw material coconut shell charcoal, and the devaluation of the currencies in Sri Lanka and that of our other Asian manufacturing locations helped us favourably, where the net benefits could be passed on to customers through price adjustments to protect and grow our sales base", he added.
During the year, Haycarb PLC through its joint venture in Thailand, Carbokarn Company Ltd, purchased 100% equity of Shizuka Company Ltd. Thailand, expanding the activated carbon manufacturing capacity of the Group. In Sri Lanka, it incorporated Haycarb Value Added Products Private Limited as a fully owned subsidiary to manufacture and export value added activated carbon products. The plant is expected to be commissioned in the financial year 2013/14. In January 2013, PT Haycarb Palu Mitra Company was incorporated as a joint venture to build a green field activated carbon plant in Central Sulawesi, Indonesia and is expected to come into commercial operation in the early part of 2014.
Challenging external conditions such as spiraling energy costs, strengthening of currencies in some of the key manufacturing bases, and increases in wage costs and overheads could impact the company’s margin potential, he said. "The price stability and availability of coconut charcoal, which is a primary driver of growth and stability of earnings faces challenging times with significant increases in pricing experienced in recent months in India and Sri Lanka" he cautioned.
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"Outpacing growing challenges in traditional markets and rising costs of production, the Hayleys Group’s multinational activated carbon business noted significant achievement of several key performance milestones in an interim statement filed with the Colombo Stock Exchange," the company said in a statement.
Haycarb in 2012/13 recorded revenue of Rs. 10.1 billion, up from Rs. 8.5 billion in the previous financial year. Significantly, the company posted profit before tax of Rs. 1.22 billion and profit after tax of Rs. 1.03billion compared to Rs. 657 million and Rs. 523 million in the preceding year.
Earnings per share of equity holders of the company doubled to Rs. 31.50, compared to the previous financial year. Haycarb, the pioneer manufacturer of activated carbon in any coconut producing country, with manufacturing facilities in Sri Lanka, Thailand and Indonesia supported by marketing offices in the UK, Australia and USA, contributed significantly to the national economy through foreign exchange earnings in excess of Rs. 5 billion whilst increasing emphasis in product innovation, market development and substantial investments in expanding its global manufacturing footprint.
Haycarb PLC and Hayleys PLC Chairman, Mohan Pandithage stated that the company has posted exceptional results to surpass Rs. One billion in profit after tax in spite of the economic slowdown that affected some of the major export markets. "The strong customer relationships we have nurtured based on mutual trust and our good governance principles assisted the company to retain key customers, and the successful market penetration strategies, enabled the company to operate at full capacity, a key driver that contributed to sustain and grow its performance" he said.
Haycarb PLC Managing Director Rajitha Kariyawasan attributed concentrated efforts on marketing, sales and new business development, emphasis on driving high margin and value added products, full capacity operations together with extensive programs on waste reduction and productivity enhancements as key to the year-end performance. "Despite contraction and stagnation of demand from our traditional markets, our sales teams and active distributorships worked aggressively to expand our market share. We also had to overcome other external challenges of rising fuel costs, wage costs and overheads".
During the year, Haycarb manufacturing operations in Sri Lanka, Indonesia and Thailand recorded exceptional performances, with some achieving the best results in their history. "Our marketing subsidiaries in Europe, Australia and in the USA brought in worthwhile contributions to both top and bottom lines", Kariyawasan stated.
"The relative stability of pricing of our key raw material coconut shell charcoal, and the devaluation of the currencies in Sri Lanka and that of our other Asian manufacturing locations helped us favourably, where the net benefits could be passed on to customers through price adjustments to protect and grow our sales base", he added.
During the year, Haycarb PLC through its joint venture in Thailand, Carbokarn Company Ltd, purchased 100% equity of Shizuka Company Ltd. Thailand, expanding the activated carbon manufacturing capacity of the Group. In Sri Lanka, it incorporated Haycarb Value Added Products Private Limited as a fully owned subsidiary to manufacture and export value added activated carbon products. The plant is expected to be commissioned in the financial year 2013/14. In January 2013, PT Haycarb Palu Mitra Company was incorporated as a joint venture to build a green field activated carbon plant in Central Sulawesi, Indonesia and is expected to come into commercial operation in the early part of 2014.
Challenging external conditions such as spiraling energy costs, strengthening of currencies in some of the key manufacturing bases, and increases in wage costs and overheads could impact the company’s margin potential, he said. "The price stability and availability of coconut charcoal, which is a primary driver of growth and stability of earnings faces challenging times with significant increases in pricing experienced in recent months in India and Sri Lanka" he cautioned.
source - www.island.lk
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Access Engineering completes project at Colombo Harbour
Access Engineering PLC recently handed over completed projects at the Unity Container Terminal (UCT), New North Pier of the Colombo Harbour.
Opened in 2004, the Unity Container Terminal (UCT) is located at the northern end of the harbor and consists of 2 berths for feeder vessels with depths alongside 9 and 11 metres. The 340m long quay is served by 3 panamax gantry cranes of 41t SWL. Eight RTGs serve two stacking areas with 1,020 ground slots.
Following the rapid recovery in transshipment volumes and securing exclusive agreements with some of the world’s biggest shipping lines, the Sri Lanka Ports Authority planned to increase container-handling capacity at its terminals to meet these increasing demands by renovating the Unity Container Terminal as well. Once this expansion is operational along with the Colombo Port Expansion Project, the SLPA would have unmatched capacity at its terminals compared to other container ports in the sub-continent.
source - www.island.lk![]()
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Opened in 2004, the Unity Container Terminal (UCT) is located at the northern end of the harbor and consists of 2 berths for feeder vessels with depths alongside 9 and 11 metres. The 340m long quay is served by 3 panamax gantry cranes of 41t SWL. Eight RTGs serve two stacking areas with 1,020 ground slots.
Following the rapid recovery in transshipment volumes and securing exclusive agreements with some of the world’s biggest shipping lines, the Sri Lanka Ports Authority planned to increase container-handling capacity at its terminals to meet these increasing demands by renovating the Unity Container Terminal as well. Once this expansion is operational along with the Colombo Port Expansion Project, the SLPA would have unmatched capacity at its terminals compared to other container ports in the sub-continent.
source - www.island.lk
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No “May day!, May day!” at CSE!
◾Colombo Bourse YTD gain crosses 10% mark as opposed to 20% down a year earlier
◾Net foreign inflows nears Rs. 10 b milestone
◾Most brokers expect market sentiment to remain buoyant on the back of policy rate cut, inflows and resilient corporate earnings though recent gains have put Bourse in over-bought territory
There doesn’t appear to be any serious distress call at the Colombo Bourse this year as it continues to gather strength much to the delight of investors and other capital market stakeholders.
In comparison to a 16% year-to-date negative growth as of 11 May last year, the Colombo Stock Exchange (CSE) is up 10.76% passing the double digit milestone on Thursday. By end May last year, the market was languishing with a 20% negative return, within the steepest fall in 2012 before ending down by 8.5%.
Reaffirming slow but steady return of fortunes, the Bourse last week gathered further strength trading at an 18-month high. The cut in policy rates on Friday by the Central Bank along with net foreign inflow nearing the Rs. 10 billion milestone as well as corporate earnings showing resilience, are likely to further cement investor confidence. Many brokers predict investor sentiments to remain buoyant though given recent gains the market fell in the overbought region by last week.
The redeeming feature was all classes of investors being active of late, though in tandem with a rebound, whereas foreigners have been smarter in picking and buying heavily when stocks were at better bargains.
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John Keells Stock Brokers (JKSB) said the indices rose sharply during the week on the back of buying interest across the board, led by large caps whilst Softlogic Stockbrokers said the benchmark surged with a 237 point gain during the week with “all types of investors” back in the market.
“Broad-based positivism pushed markets over 200 points, with both retail and institutional investors showing renewed vigor,” noted Acuity Stockbrokers.
Asia Wealth Management said the market gradually continued to build up on the 6,000 levels, after falling below the 5,000 levels in August last year. The All Share Index managed to accumulate a whopping 236.8 points during the week on the back of healthy retail and institutional participation, it added.
The week started with a rally that raised the ASI index by 108 points within a day amidst a major deal (RCL acquiring 76% of Lanka Ceramics). Momentum continued for the rest of the week as well, while ASI reached its 6200 levels supported by the price appreciations of index-heavy counters such as JKH, SPEN and DIST. Momentum slowed down towards the end marginally while the week closed ASI at 6250 level, stated LOLC Securities.
Turnover value reached a 32-week high of Rs. 4.1 billion on Monday (due to Royal Ceramics and connected parties buying near 90% control of Lanka Ceramics) amid active retail participation across the board. Cumulative turnover for the week consequently increased to Rs. 10.6 billion, averaging Rs. 2.1 billion, a 107% increase from the year-to-date daily average of Rs. 1 billion, said Acuity adding “Upbeat sentiment is likely to continue in the week ahead.”
The policy rates cut by the Central Bank on Friday by 50 basis points as expected by the financial services industry though the IMF has cautioned against the move, is likely to bolster investor sentiments. With that move Sri Lanka joined the wave of rate cuts globally such as India, Australia, Vietnam, South Korea and the ECB.
The cut in Sri Lanka was largely driven by the slower than expected pick up in economic activity within the first few months of 2013due to moderate inflation and subdued demand pressure.
Acuity said markets which have been gradually pricing in a further rate cut over the past few sessions hence made a sharp jump this week ahead of the Central Bank’s official announcement of a 50 bps policy rate cut.
Asia Wealth said the cut was in furtherance of CB’s monetary policy easing stance, since a downward revision affected it in December 2012. Further, the country’s Treasury bill rates also witnessed a continuous decline over the past few weeks which could also be attributed to the expectations regarding the reduction in policy rates. During the week the three-month T-bill rates dipped by 02 bps to stand at 9.18% while six-month T bill rates also dropped by 02 bps to close at 10.20%.
“The CBSL expects the policy rate reduction to increase private sector credit growth, and improve the economic growth whilst facilitating the government to finance the public investment program at lower costs. On the back of this development, we expect the equity market to be more attractive relative to other investments modes. Thus, we advice investors to take positions on fundamentally sturdy counters with high growth potential to reap benefits,” Asia Wealth opined.
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Softlogic said the rate cut is likely to bring down market interest rates in the short term.
“The rate cut is likely to shift investors away from fixed income towards other sources of investment. The move is likely to boost demand for equity investments in the medium term. We advise investors to accumulate the following companies. It is a positive signal for high debt companies with lower finance cost and banking sector counters which would benefit from margin expansion,” the broking firm added.
Lanka Securities said compared to its peers, the CSE still trades at attractive multiples indicating more room for price appreciations. However as a result of the sharp price increases during the past few days, the Bourse is trading in “overbought” territory (the 14-day Relative Strength Index is at 90). “Although valuations remain favourable traders are advised to book profits when able to. A period of consolidation is on the cards as market RSI has reached a high level,” LSE added.
DNH Financial said it expects market sentiment to remain buoyant during next week with positive investor sentiment underpinning momentum.
“However, given that the equity market has a notorious tendency to rush from one side to another in response to the ebb and flow of optimism or pessimism, we recommend investors to make a directional call, build a quality portfolio and take advantage of what is increasingly becoming a ‘stockpickers’ market. Investors are consequently advised to seek cash rich companies with strong balance sheets that have underperformed during periods of market over-exuberance and which have the upside potential to re-rate to their intrinsic values,” DNH said.
“With confidence returning to the market, we view the current market level as an opportunity for investors to reposition themselves with a flight to quality. We advise investors to break away from the herd, maintain a healthy investment horizon and focus on companies that will deliver quality earnings. On a sector basis, we believe that conventionally defensive sectors such as Telecoms could experience a slowdown in top line growth exacerbated by downward pressure on margins due to price competition. Conversely, we believe that several of the traditionally more cyclical sectors such as Banking, Services, Construction and Tourism could generate highly attractive defensive attributes, such as strong volume growth and pricing power which should enable them to maintain margins while generating sustained cash-flow. However investors may need to be highly selective focusing on stocks that are not overly leveraged or have high energy requirements,” DNH added.
Foreign net inflow as of last week year to date was Rs. 9.6 billion. Acuity said foreign investor activity recorded a net buying position of Rs. 660 million, relative to Rs. 350 million in the previous week with daily average net inflows increasing 52.59% week-on-week. Average foreign purchases increased 111.96% week-on-week. In terms of volume, Distilleries and HNB led foreign purchases, while Commercial Bank and Renuka Agri led foreign sales. In terms of transaction value too, Distilleries and HNB led foreign purchases, while Commercial Bank and Royal Ceramics led foreign sales.
Asia Wealth said foreign investors continued with their block trades in selected counters resulting in the net foreign inflow. “It could be observed that continuous foreign investor participation had been an inspirational factor for local institutional investors to be active again,” Asia added.
Dubai next stop for CSE global road show
As part of wooing further foreign investor interest, the Colombo Stock Exchange (CSE) has shifted focus on the Middle East via the region’s hub Dubai.
The next edition of “Invest Sri Lanka” Investor Forum organised by the CSE in partnership with Bloomberg will be held at the Ritz Carlton, Dubai International Financial Centre, on 3 June.
This will be the second investor road show whilst the first one was successfully held in Mumbai in February. A similar event is planned in Hong Kong in September.
Over 100 fund managers based in Mumbai attended the conference whilst nine listed firms and over 15 broking firms formed part of the Sri Lankan contingent.
For the Dubai event, the Sri Lankan delegation will be led by Senior Minister for International Monetary Cooperation and Deputy Minister for Finance and Planning Dr. Sarath Amunugama and will include Deputy Minister for Investment Promotion Faiszer Musthapha, SEC Chairman Dr. Nalaka Godahewa and CSE Chairman Krishan Balendra. Other speakers include CSE Director Vajira Kulatilaka and BOI Executive Director Investment Promotions Duminda Ariyasinghe.
Earnings season off to a good start
Earnings season has got off to a better than expected start. Based on the earnings of 19 companies which have released interim financial statements by last week, earnings have increased by over 74% year-on-year in the January-March 2013 quarter, according to Lanka Securities Ltd.
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◾Net foreign inflows nears Rs. 10 b milestone
◾Most brokers expect market sentiment to remain buoyant on the back of policy rate cut, inflows and resilient corporate earnings though recent gains have put Bourse in over-bought territory
There doesn’t appear to be any serious distress call at the Colombo Bourse this year as it continues to gather strength much to the delight of investors and other capital market stakeholders.
In comparison to a 16% year-to-date negative growth as of 11 May last year, the Colombo Stock Exchange (CSE) is up 10.76% passing the double digit milestone on Thursday. By end May last year, the market was languishing with a 20% negative return, within the steepest fall in 2012 before ending down by 8.5%.
Reaffirming slow but steady return of fortunes, the Bourse last week gathered further strength trading at an 18-month high. The cut in policy rates on Friday by the Central Bank along with net foreign inflow nearing the Rs. 10 billion milestone as well as corporate earnings showing resilience, are likely to further cement investor confidence. Many brokers predict investor sentiments to remain buoyant though given recent gains the market fell in the overbought region by last week.
The redeeming feature was all classes of investors being active of late, though in tandem with a rebound, whereas foreigners have been smarter in picking and buying heavily when stocks were at better bargains.
John Keells Stock Brokers (JKSB) said the indices rose sharply during the week on the back of buying interest across the board, led by large caps whilst Softlogic Stockbrokers said the benchmark surged with a 237 point gain during the week with “all types of investors” back in the market.
“Broad-based positivism pushed markets over 200 points, with both retail and institutional investors showing renewed vigor,” noted Acuity Stockbrokers.
Asia Wealth Management said the market gradually continued to build up on the 6,000 levels, after falling below the 5,000 levels in August last year. The All Share Index managed to accumulate a whopping 236.8 points during the week on the back of healthy retail and institutional participation, it added.
The week started with a rally that raised the ASI index by 108 points within a day amidst a major deal (RCL acquiring 76% of Lanka Ceramics). Momentum continued for the rest of the week as well, while ASI reached its 6200 levels supported by the price appreciations of index-heavy counters such as JKH, SPEN and DIST. Momentum slowed down towards the end marginally while the week closed ASI at 6250 level, stated LOLC Securities.
Turnover value reached a 32-week high of Rs. 4.1 billion on Monday (due to Royal Ceramics and connected parties buying near 90% control of Lanka Ceramics) amid active retail participation across the board. Cumulative turnover for the week consequently increased to Rs. 10.6 billion, averaging Rs. 2.1 billion, a 107% increase from the year-to-date daily average of Rs. 1 billion, said Acuity adding “Upbeat sentiment is likely to continue in the week ahead.”
The policy rates cut by the Central Bank on Friday by 50 basis points as expected by the financial services industry though the IMF has cautioned against the move, is likely to bolster investor sentiments. With that move Sri Lanka joined the wave of rate cuts globally such as India, Australia, Vietnam, South Korea and the ECB.
The cut in Sri Lanka was largely driven by the slower than expected pick up in economic activity within the first few months of 2013due to moderate inflation and subdued demand pressure.
Acuity said markets which have been gradually pricing in a further rate cut over the past few sessions hence made a sharp jump this week ahead of the Central Bank’s official announcement of a 50 bps policy rate cut.
Asia Wealth said the cut was in furtherance of CB’s monetary policy easing stance, since a downward revision affected it in December 2012. Further, the country’s Treasury bill rates also witnessed a continuous decline over the past few weeks which could also be attributed to the expectations regarding the reduction in policy rates. During the week the three-month T-bill rates dipped by 02 bps to stand at 9.18% while six-month T bill rates also dropped by 02 bps to close at 10.20%.
“The CBSL expects the policy rate reduction to increase private sector credit growth, and improve the economic growth whilst facilitating the government to finance the public investment program at lower costs. On the back of this development, we expect the equity market to be more attractive relative to other investments modes. Thus, we advice investors to take positions on fundamentally sturdy counters with high growth potential to reap benefits,” Asia Wealth opined.
Softlogic said the rate cut is likely to bring down market interest rates in the short term.
“The rate cut is likely to shift investors away from fixed income towards other sources of investment. The move is likely to boost demand for equity investments in the medium term. We advise investors to accumulate the following companies. It is a positive signal for high debt companies with lower finance cost and banking sector counters which would benefit from margin expansion,” the broking firm added.
Lanka Securities said compared to its peers, the CSE still trades at attractive multiples indicating more room for price appreciations. However as a result of the sharp price increases during the past few days, the Bourse is trading in “overbought” territory (the 14-day Relative Strength Index is at 90). “Although valuations remain favourable traders are advised to book profits when able to. A period of consolidation is on the cards as market RSI has reached a high level,” LSE added.
DNH Financial said it expects market sentiment to remain buoyant during next week with positive investor sentiment underpinning momentum.
“However, given that the equity market has a notorious tendency to rush from one side to another in response to the ebb and flow of optimism or pessimism, we recommend investors to make a directional call, build a quality portfolio and take advantage of what is increasingly becoming a ‘stockpickers’ market. Investors are consequently advised to seek cash rich companies with strong balance sheets that have underperformed during periods of market over-exuberance and which have the upside potential to re-rate to their intrinsic values,” DNH said.
“With confidence returning to the market, we view the current market level as an opportunity for investors to reposition themselves with a flight to quality. We advise investors to break away from the herd, maintain a healthy investment horizon and focus on companies that will deliver quality earnings. On a sector basis, we believe that conventionally defensive sectors such as Telecoms could experience a slowdown in top line growth exacerbated by downward pressure on margins due to price competition. Conversely, we believe that several of the traditionally more cyclical sectors such as Banking, Services, Construction and Tourism could generate highly attractive defensive attributes, such as strong volume growth and pricing power which should enable them to maintain margins while generating sustained cash-flow. However investors may need to be highly selective focusing on stocks that are not overly leveraged or have high energy requirements,” DNH added.
Foreign net inflow as of last week year to date was Rs. 9.6 billion. Acuity said foreign investor activity recorded a net buying position of Rs. 660 million, relative to Rs. 350 million in the previous week with daily average net inflows increasing 52.59% week-on-week. Average foreign purchases increased 111.96% week-on-week. In terms of volume, Distilleries and HNB led foreign purchases, while Commercial Bank and Renuka Agri led foreign sales. In terms of transaction value too, Distilleries and HNB led foreign purchases, while Commercial Bank and Royal Ceramics led foreign sales.
Asia Wealth said foreign investors continued with their block trades in selected counters resulting in the net foreign inflow. “It could be observed that continuous foreign investor participation had been an inspirational factor for local institutional investors to be active again,” Asia added.
Dubai next stop for CSE global road show
As part of wooing further foreign investor interest, the Colombo Stock Exchange (CSE) has shifted focus on the Middle East via the region’s hub Dubai.
The next edition of “Invest Sri Lanka” Investor Forum organised by the CSE in partnership with Bloomberg will be held at the Ritz Carlton, Dubai International Financial Centre, on 3 June.
This will be the second investor road show whilst the first one was successfully held in Mumbai in February. A similar event is planned in Hong Kong in September.
Over 100 fund managers based in Mumbai attended the conference whilst nine listed firms and over 15 broking firms formed part of the Sri Lankan contingent.
For the Dubai event, the Sri Lankan delegation will be led by Senior Minister for International Monetary Cooperation and Deputy Minister for Finance and Planning Dr. Sarath Amunugama and will include Deputy Minister for Investment Promotion Faiszer Musthapha, SEC Chairman Dr. Nalaka Godahewa and CSE Chairman Krishan Balendra. Other speakers include CSE Director Vajira Kulatilaka and BOI Executive Director Investment Promotions Duminda Ariyasinghe.
Earnings season off to a good start
Earnings season has got off to a better than expected start. Based on the earnings of 19 companies which have released interim financial statements by last week, earnings have increased by over 74% year-on-year in the January-March 2013 quarter, according to Lanka Securities Ltd.
source - www.ft.lk
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Bourse, rupee, T-bond yields down
The Colombo bourse dipped yesterday (13) on profit taking, reversing a seven day upswing, while the rupee weakened against the US dollar. Treasury bond yields eased on improved liquidity levels.
The rupee closed at Rs. 126.30/35 against the US dollar, weakening from an opening position of Rs. 126.17/20 against the greenback on importer demand, currency dealers said.
Meanwhile yields plunged across the board in the secondary market for Treasury bonds as activity levels picked up on improving liquidity levels, except the 8 year bond where the yield tightened to 11.45/60 percent from the previous day’s 11.40/60 percent.
The more liquid five year bond yield fell to 10.93/96 percent from 10.98/11.02 percent while the four year yield slumped to 10.70/77 percent from 10.85/11.00 percent.
The three year bond yield fell to 10.78/82 percent from 10.80/90 while the two year yield fell to 10.60/80 percent from 10.80/11.00. The one year bond yield fell sharply to 10.50/70 percent from an opening position of 10.75/90 percent.
The Central Bank’s Treasury bill holdings fell to Rs. 94.54 billion yesterday from Rs. 103.94 billion on Friday.
Currency dealers said market interest rates could come down after the Central Bank cut monetary policy interest rates by 50bps last week.
Profit taking saw the All Share Price Index fall 10.97 points to close 0.18 percent lower at 6,239.03 while the S&P SL20 closed 0.34 percent lower, down 12.05 points to 3,518.85.
Turnover amounted to Rs. 535.05 million.
Foreign purchases amounted to Rs. 176.94 million, leading to a net inflow of Rs. 152.99 million.
"The indices dipped reversing a 7-day upward trend, mainly due to profit taking on a selected set of large cap and second tier counters. Activity levels slowed down during the day and were dominated by trades on banking and diversified counters, inclusive of a crossing on JKH," John Keells Stockbrokers said.
"Trades in John Keells Holdings and Softlogic Holdings accounted for 28% of the day’s turnover.
Losers modestly outpaced gainers with SMB Leasing(X), Samson International and Nation Lanka Finance(X) falling by 20%, 8.9% and 6.7% and offsetting gains in J.L.Morison(X), J.L.Morison and Radiant Gems which rose by 39.9%, 21.3% and 13.1% respectively," DNH Financial said.
source - www.island.lk![]()
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The rupee closed at Rs. 126.30/35 against the US dollar, weakening from an opening position of Rs. 126.17/20 against the greenback on importer demand, currency dealers said.
Meanwhile yields plunged across the board in the secondary market for Treasury bonds as activity levels picked up on improving liquidity levels, except the 8 year bond where the yield tightened to 11.45/60 percent from the previous day’s 11.40/60 percent.
The more liquid five year bond yield fell to 10.93/96 percent from 10.98/11.02 percent while the four year yield slumped to 10.70/77 percent from 10.85/11.00 percent.
The three year bond yield fell to 10.78/82 percent from 10.80/90 while the two year yield fell to 10.60/80 percent from 10.80/11.00. The one year bond yield fell sharply to 10.50/70 percent from an opening position of 10.75/90 percent.
The Central Bank’s Treasury bill holdings fell to Rs. 94.54 billion yesterday from Rs. 103.94 billion on Friday.
Currency dealers said market interest rates could come down after the Central Bank cut monetary policy interest rates by 50bps last week.
Profit taking saw the All Share Price Index fall 10.97 points to close 0.18 percent lower at 6,239.03 while the S&P SL20 closed 0.34 percent lower, down 12.05 points to 3,518.85.
Turnover amounted to Rs. 535.05 million.
Foreign purchases amounted to Rs. 176.94 million, leading to a net inflow of Rs. 152.99 million.
"The indices dipped reversing a 7-day upward trend, mainly due to profit taking on a selected set of large cap and second tier counters. Activity levels slowed down during the day and were dominated by trades on banking and diversified counters, inclusive of a crossing on JKH," John Keells Stockbrokers said.
"Trades in John Keells Holdings and Softlogic Holdings accounted for 28% of the day’s turnover.
Losers modestly outpaced gainers with SMB Leasing(X), Samson International and Nation Lanka Finance(X) falling by 20%, 8.9% and 6.7% and offsetting gains in J.L.Morison(X), J.L.Morison and Radiant Gems which rose by 39.9%, 21.3% and 13.1% respectively," DNH Financial said.
source - www.island.lk
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Blind leading the blind?
Once high flying Touchwood Investments Plc (TWOD) is apparently facing rough weather with incomplete disclosure given the part sell out by key Directors whilst they themselves have taken up additional responsibilities in troubled CIFL throwing open a barrage of questions over good governance and effectiveness of the regulatory role from shareholders and investment analysts alike.
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In what some analysts termed as bizarre developments, troubled finance company, Central Investments and Finance Plc, on Friday in a filing to the Colombo Stock Exchange (CSE), said three new members Roscoe Meloney, Swarna J. Meloney (Chairman and Vice Chairperson of Touchwood) and Dulan Hettiarachchi have been appointed to the Board effective 2 May 2013. Meloney has been appointed as the new Chairman of CIFL replacing K. A. L. Rupasinghe who had resigned whilst CEO Gamini Karunathilake too has resigned with Swarna J. Meloney appointed as Acting CEO until a permanent appointment is made.
This was after CIFL in early April in response to a Sunday newspaper article which referred to change of ownership responded saying the company has been notified by a new investor by the name of Roscoe Meloney that they have concluded the acquisition of the holding company Aspic Corporation along with nine subsidiary companies.
Accordingly they have claimed to be major shareholders of CIFL and they have copied some of their communications with the Central Bank on the same subject which indicate that they intend infusing approximately US$ 12 million to CIFL and bring in a high level of corporate governance and financial integrity.
“We are currently communicating with this party and the Central Bank in getting the necessary approvals etc for this purpose. We will arrange to keep you informed about the future development in this respect,” said the 2 April 2013 filing to CSE by CIFL Chairman Lakshman Rupasinghe.
With no further updates, CIFL last Friday merely stated the change in the Board of Directors leaving many shareholder and investment analyst’s questions unanswered.
Yesterday Touchwood Plc announced that eChannelling Plc Chairman and CEO Ruwan Silva has been appointed with immediate effect to be the Principal Consultant and Advisor to the Board of Directors.
Silva would be assisting Touchwood with regard to mergers and acquisitions, investor relations and the restructuring of the Company in addition to other responsibilities. He would assist the Company in identifying and introducing strategic investors to Touchwood.
The connection between Silva and Touchwood owners wasn’t explained or on what basis he was handpicked except that he was described as been instrumental in the turnaround of eChannelling and has been involved in many other company restructuring projects.
Touchwood’s filing to the CSE signed by Deputy Chairperson Swarna J. Maloney also said “The Chairman and Deputy Chairman of Touchwood Investments Plc are committed to strengthen and improving Touchwood Investment Plc and are embarking on a substantial restructuring of the company which would enhance profitability, which would benefit all stakeholders including the shareholders”.
The revelation of strengthening and improving Touchwood and “substantial restructuring” comes out of the blues as there had been no other prior disclosure from the company in recent months.
Company analysts were perturbed on what basis did Touchwood controlling shareholders agree to infuse money into the troubled finance company (CIFL) when their own venture was under distress.
They also questioned on what basis did the Central Bank approve this deal and whether proper due diligence was done?
Ironically, Touchwood Plc’s Chairman and Deputy Chairperson are yet to make good corporate governance practice-linked timely disclosure of their own acts with regard to divesting of some of their shareholdings in the Company.
The Daily FT learns Mr. and Mrs. Maloney sold a substantial part of their shareholding in Touchwood in the market to retailers in recent weeks but to date there has been no disclosure as part of Director’s dealings in company shares. Mr. Maloney had at least sold around over Rs. 80 million worth of Touchwood shares and Ms. Maloney around Rs. 40 million in recent weeks as per one analyst.
As per 31 December 2012 shareholdings, Mr. Maloney held 17.5 million shares or 16.36% stake in Touchwood whilst Mrs. Maloney held 9.6 million or 9% stake.
The selling by Mrs. Maloney comes after she was appointed Vice Chairperson in April.
As per Daily FT analysis, Touchwood saw heavy trading in recent weeks. For example in the week ended 3 May 2013, around 30% stake of the company traded followed by 18% last week. A large number of retailers were active whilst several were seen recycling trades. Some may have been engaging in speculative trading whilst others could have been told an untrue “upturn” story.
Touchwood has a retained loss of Rs. 367.56 million at group level as at 31 December 2012, up from Rs. 321 million a year earlier. Its assets amounted to Rs. 7.7 billion including Rs. 6 billion as biological assets, valuation of which in the past had raised concerns among investment analysts.
Group noncurrent liabilities amounted to Rs. 4.4 billion and Rs. 146 million in current liabilities.
Revenue in the first nine months of FY13 was down to Rs. 899 million from Rs. 943 million a year earlier whilst net profit was Rs. 130 million up from Rs. 110 million.
The new Principal Consultant and Advisor has an arduous task as per analysts. He is also the Chairman of British American Technologies which is the major shareholder of eChanneling.
Previously he was the CEO of Blue Diamonds Jewellery Worldwide Plc and served as CFO at Sri Lanka Telecom and Ericsson Algeria and Sri Lanka.
On the other hand CIFL’s first nine months revenue for FY13 was up 14% to Rs. 513 million, whilst net income was down by 46% to Rs. 116 million owing to an 83% dip in other operating income and 81% rise in interest income.
Operating losses were Rs. 261.7 million, up by 30% over the first nine months of FY12. Profit loss before loan losses and provisions was Rs. 145.4 million as against a profit of Rs. 13 million a year earlier.
Net losses for nine months of FY13 were Rs. 147 million as against a profit of Rs. 7 million.
CIFL was saddled with negative revenue reserves of Rs. 92 million as at 31 December 2013 as again a positive Rs. 55 million a year earlier and 31 March 2012.
Assets amounted to Rs. 3.8 billion, up from Rs. 3.3 billion a year earlier and Rs. 3.6 billion as at end FY12.
Liabilities amounted to Rs. 3.2 billion, up from Rs. 2.6 billion as at 31 December 2012 and Rs. 2.9 billion as FY12.
source - www.ft.lk
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In what some analysts termed as bizarre developments, troubled finance company, Central Investments and Finance Plc, on Friday in a filing to the Colombo Stock Exchange (CSE), said three new members Roscoe Meloney, Swarna J. Meloney (Chairman and Vice Chairperson of Touchwood) and Dulan Hettiarachchi have been appointed to the Board effective 2 May 2013. Meloney has been appointed as the new Chairman of CIFL replacing K. A. L. Rupasinghe who had resigned whilst CEO Gamini Karunathilake too has resigned with Swarna J. Meloney appointed as Acting CEO until a permanent appointment is made.
This was after CIFL in early April in response to a Sunday newspaper article which referred to change of ownership responded saying the company has been notified by a new investor by the name of Roscoe Meloney that they have concluded the acquisition of the holding company Aspic Corporation along with nine subsidiary companies.
Accordingly they have claimed to be major shareholders of CIFL and they have copied some of their communications with the Central Bank on the same subject which indicate that they intend infusing approximately US$ 12 million to CIFL and bring in a high level of corporate governance and financial integrity.
“We are currently communicating with this party and the Central Bank in getting the necessary approvals etc for this purpose. We will arrange to keep you informed about the future development in this respect,” said the 2 April 2013 filing to CSE by CIFL Chairman Lakshman Rupasinghe.
With no further updates, CIFL last Friday merely stated the change in the Board of Directors leaving many shareholder and investment analyst’s questions unanswered.
Yesterday Touchwood Plc announced that eChannelling Plc Chairman and CEO Ruwan Silva has been appointed with immediate effect to be the Principal Consultant and Advisor to the Board of Directors.
Silva would be assisting Touchwood with regard to mergers and acquisitions, investor relations and the restructuring of the Company in addition to other responsibilities. He would assist the Company in identifying and introducing strategic investors to Touchwood.
The connection between Silva and Touchwood owners wasn’t explained or on what basis he was handpicked except that he was described as been instrumental in the turnaround of eChannelling and has been involved in many other company restructuring projects.
Touchwood’s filing to the CSE signed by Deputy Chairperson Swarna J. Maloney also said “The Chairman and Deputy Chairman of Touchwood Investments Plc are committed to strengthen and improving Touchwood Investment Plc and are embarking on a substantial restructuring of the company which would enhance profitability, which would benefit all stakeholders including the shareholders”.
The revelation of strengthening and improving Touchwood and “substantial restructuring” comes out of the blues as there had been no other prior disclosure from the company in recent months.
Company analysts were perturbed on what basis did Touchwood controlling shareholders agree to infuse money into the troubled finance company (CIFL) when their own venture was under distress.
They also questioned on what basis did the Central Bank approve this deal and whether proper due diligence was done?
Ironically, Touchwood Plc’s Chairman and Deputy Chairperson are yet to make good corporate governance practice-linked timely disclosure of their own acts with regard to divesting of some of their shareholdings in the Company.
The Daily FT learns Mr. and Mrs. Maloney sold a substantial part of their shareholding in Touchwood in the market to retailers in recent weeks but to date there has been no disclosure as part of Director’s dealings in company shares. Mr. Maloney had at least sold around over Rs. 80 million worth of Touchwood shares and Ms. Maloney around Rs. 40 million in recent weeks as per one analyst.
As per 31 December 2012 shareholdings, Mr. Maloney held 17.5 million shares or 16.36% stake in Touchwood whilst Mrs. Maloney held 9.6 million or 9% stake.
The selling by Mrs. Maloney comes after she was appointed Vice Chairperson in April.
As per Daily FT analysis, Touchwood saw heavy trading in recent weeks. For example in the week ended 3 May 2013, around 30% stake of the company traded followed by 18% last week. A large number of retailers were active whilst several were seen recycling trades. Some may have been engaging in speculative trading whilst others could have been told an untrue “upturn” story.
Touchwood has a retained loss of Rs. 367.56 million at group level as at 31 December 2012, up from Rs. 321 million a year earlier. Its assets amounted to Rs. 7.7 billion including Rs. 6 billion as biological assets, valuation of which in the past had raised concerns among investment analysts.
Group noncurrent liabilities amounted to Rs. 4.4 billion and Rs. 146 million in current liabilities.
Revenue in the first nine months of FY13 was down to Rs. 899 million from Rs. 943 million a year earlier whilst net profit was Rs. 130 million up from Rs. 110 million.
The new Principal Consultant and Advisor has an arduous task as per analysts. He is also the Chairman of British American Technologies which is the major shareholder of eChanneling.
Previously he was the CEO of Blue Diamonds Jewellery Worldwide Plc and served as CFO at Sri Lanka Telecom and Ericsson Algeria and Sri Lanka.
On the other hand CIFL’s first nine months revenue for FY13 was up 14% to Rs. 513 million, whilst net income was down by 46% to Rs. 116 million owing to an 83% dip in other operating income and 81% rise in interest income.
Operating losses were Rs. 261.7 million, up by 30% over the first nine months of FY12. Profit loss before loan losses and provisions was Rs. 145.4 million as against a profit of Rs. 13 million a year earlier.
Net losses for nine months of FY13 were Rs. 147 million as against a profit of Rs. 7 million.
CIFL was saddled with negative revenue reserves of Rs. 92 million as at 31 December 2013 as again a positive Rs. 55 million a year earlier and 31 March 2012.
Assets amounted to Rs. 3.8 billion, up from Rs. 3.3 billion a year earlier and Rs. 3.6 billion as at end FY12.
Liabilities amounted to Rs. 3.2 billion, up from Rs. 2.6 billion as at 31 December 2012 and Rs. 2.9 billion as FY12.
source - www.ft.lk
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Sri Lanka stocks close up 0.2-pct
May 15, 2013 (LBO) - Sri Lanka’s stock closed up 0.23 percent on Wednesday, ending a two days of losses, with sentiment helped by falling Treasuries yields amid strong foreign buying into motor stocks, brokers said.
The benchmark Colombo All Share Index closed 14.53 points higher at 6,221.12 up 0.23 percent and the S&P SL 20 Index closed 02.16 points lower at 3,498.34 down 0.20 percent.
Turnover was 1.6 billion rupees.
Turnover was 1.6 billion rupees up from 636 million rupees a day earlier. Foreigners brought 860 million rupees worth shares while selling 229 million rupees of shares.
Yields fell up to 45 basis points at Wednesday's Treasuries auction, which brokers said helped boost sentiment in late trading.
Diesel and Motor Engineering, agents for Benz and Tata closed up 9.50 to close at 614.90 and United Motors, which has the agency for Mitsubishi closed up 5.50 rupees at 113.10 rupees, helped by foreign buying, brokers said.
The benchmark index gained helped most by Nestle Lanka which closed at 1887.50 rupees up 33.30 rupees. Carsons Cumberbatch gained 6.00 rupees to close at 446.00 rupees and John Keells Holding closed at 274.20 rupees up 1.20 rupees.
Hatton National Bank closed at 168.00 rupees down 2.90 rupees, DFCC Bank closed flat at 147.10 rupees, Commercial Bank of Ceylon closed 115.00 rupees down 1.60 rupees and National Development Bank closed at 174.90 rupees down 4.10 rupees.
Pan Asia closed at 21.10 rupees down 70 cents. Union Bank of Colombo closed at 19.90 rupees down 40 cents and Sampath Bank loss 3.50 rupees to close at 223.50 rupees.
LB Finance closed at 130.50 rupees down 4.00 rupees, Peoples Leasing and Finance lost 20 cents to close at 14.80 rupees and Commercial Leasing and Finance closed at 4.70 rupees up 10 cents.
Distilleries Company of Sri Lanka gained 1.60 rupees to close 183.60 rupees And Ceylon Tobacco Company gained 1.90 rupees to close at 830.00 rupees.
Aitken Spence closed at 134.90 down 10 cents. Browns Investments closed flat at 3.50 rupees.
Softlogic Holding gained 10cents to close at 12.10 rupees Hayleys closed at 300.00 rupees down 30 cents and Vallibel One closed flat at 20.00 rupees.
Sri Lanka Telecom gained 10 cents to close at 42.70 after reporting strong profits, and Dialog Axiata closed flat at 9.50 rupees.
source - www.lbo.lk![]()
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The benchmark Colombo All Share Index closed 14.53 points higher at 6,221.12 up 0.23 percent and the S&P SL 20 Index closed 02.16 points lower at 3,498.34 down 0.20 percent.
Turnover was 1.6 billion rupees.
Turnover was 1.6 billion rupees up from 636 million rupees a day earlier. Foreigners brought 860 million rupees worth shares while selling 229 million rupees of shares.
Yields fell up to 45 basis points at Wednesday's Treasuries auction, which brokers said helped boost sentiment in late trading.
Diesel and Motor Engineering, agents for Benz and Tata closed up 9.50 to close at 614.90 and United Motors, which has the agency for Mitsubishi closed up 5.50 rupees at 113.10 rupees, helped by foreign buying, brokers said.
The benchmark index gained helped most by Nestle Lanka which closed at 1887.50 rupees up 33.30 rupees. Carsons Cumberbatch gained 6.00 rupees to close at 446.00 rupees and John Keells Holding closed at 274.20 rupees up 1.20 rupees.
Hatton National Bank closed at 168.00 rupees down 2.90 rupees, DFCC Bank closed flat at 147.10 rupees, Commercial Bank of Ceylon closed 115.00 rupees down 1.60 rupees and National Development Bank closed at 174.90 rupees down 4.10 rupees.
Pan Asia closed at 21.10 rupees down 70 cents. Union Bank of Colombo closed at 19.90 rupees down 40 cents and Sampath Bank loss 3.50 rupees to close at 223.50 rupees.
LB Finance closed at 130.50 rupees down 4.00 rupees, Peoples Leasing and Finance lost 20 cents to close at 14.80 rupees and Commercial Leasing and Finance closed at 4.70 rupees up 10 cents.
Distilleries Company of Sri Lanka gained 1.60 rupees to close 183.60 rupees And Ceylon Tobacco Company gained 1.90 rupees to close at 830.00 rupees.
Aitken Spence closed at 134.90 down 10 cents. Browns Investments closed flat at 3.50 rupees.
Softlogic Holding gained 10cents to close at 12.10 rupees Hayleys closed at 300.00 rupees down 30 cents and Vallibel One closed flat at 20.00 rupees.
Sri Lanka Telecom gained 10 cents to close at 42.70 after reporting strong profits, and Dialog Axiata closed flat at 9.50 rupees.
source - www.lbo.lk
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