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Sri Lankan shares fall to 4-month closing low on foreign selling

DIMANTHA MATHEW, HEAD OF RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

MAY 31, 2018

COLOMBO, May 30 (Reuters) – Sri Lankan shares fell for a third straight session on Wednesday and posted their lowest close in more than four months, as foreign investors sold diversified stocks such as conglomerate John Keells Holdings Plc and Aitken Spence Plc.

A weaker rupee, political uncertainty and the recent fuel price hike also weighed on sentiment, with investors mostly keeping to the sidelines awaiting cues about the real impact of the floods that hit the island nation over the past week, brokers said.

Foreign investors sold net 1.11 billion rupees worth of equities on Wednesday, turning the year-to-date foreign trade to a net outflow of 900.9 million rupees worth of shares.

The Colombo stock index ended 0.5 percent weaker at 6,420.98. It fell 0.4 percent last week.

Turnover was 1.7 billion rupees ($10.76 million) on Wednesday, well above this year’s daily average of 984.5 million rupees.

“Market came down on heavy foreign selling on John Keells,” said Dimantha Mathew, head of research, First Capital Holdings.

“Foreign investors are worried over the rupee depreciation. Currency depreciation is the major worry for foreigners in any country.”

Analysts said investors are waiting to see the full impact of the floods, which killed 24 people last week.

Shares of John Keells Holdings fell 2.2 percent, Aitken Spence and Company lost 8.1 percent, Sampath Bank Plc ended 1.7 percent weaker and Ceylon Tobacco Company Plc slipped 0.6 percent.

The rupee hit a fresh low of 158.50 per dollar on May 16 on importer demand for the U.S. currency.

Analysts said market sentiment had been dented by concerns over political instability following President Maithripala Sirisena’s decision to suspend parliament last month after 16 legislators from his ruling coalition defected.

On May 8, Sirisena urged his own coalition government and the opposition to end a power struggle to achieve ambitious goals including anti-corruption measures. ($1 = 158.0000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

Dimantha Mathew, Head of Research at First Capital Holdings, with the Market Review on Ada Derana – 27.05.2018

Stock Market Sri Lanka

First Capital’s Dimantha Mathew with the Market Review on Ada Derana

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management, retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.

First Capital’s Dimantha Mathew with the Market Review on Ada Derana

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management, retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.

First Capital’s Dimantha Mathew with the Market Review on Ada Derana

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management, retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.

First Capital records highest ever PAT of Rs. 1.96 billion in 17/18

Nishan Fernando: Chairman First Capital

Colombo 30 May 2018:  First Capital Holdings PLC (The Group) the only listed investment bank in Sri Lanka, recorded its highest ever Consolidated Profit after Tax of Rs 1,960Mn for the year 2017/18, marking a milestone in the investment bank’s history.

The results show a significant growth compared to Rs. 232Mn in 2016/17. First Capital, with its impressive 35 year history, has total assets of Rs.35Bn and Equity in excess of Rs. 3.5Bn.

Dilshan Wirasekara: Director/CEO – First Capital

The Group recorded a total comprehensive income of Rs 1,866Mn for the year, a healthy increase from Rs. 238Mn recorded in 2016/17.  First Capital’s performance includes recognition of a deferred tax asset amounting to Rs. 897Mn (2017/18) in accordance to LKAS 12.

The Group’s primary dealer contributed Rs. 1,668Mn Profit after Tax (including recognition of a deferred tax asset of Rs. 845Mn) for the year, bolstered by opportunities derived through secondary market activities, the business displayed an impressive performance.

The corporate finance division, mobilized Rs. 24Bn through the structuring and placement of corporate debt securities. Increasing its contribution to the Group’s profitability, the business reported a total fee income of Rs. 80Mn for the year.

The asset management division, increased its assets under management by Rs. 2.1Bn in 2017/18, demonstrating a positive impact to the Group’s bottom line, with a total fee income of Rs. 38Mn.

The Group’s stock brokering unit, recorded an income of Rs. 78Mn for the financial year.

First Capital also made investments to enhance its regional presence through the expansion of its branch network to Negombo; in addition to fully-fledged branches operating in Matara, Kandy and Kurunegala.

The credit rating of SL [A-] with a stable outlook for First Capital Holdings PLC and First Capital Treasuries PLC were re-affirmed by ICRA Lanka Limited.

In March 2018, First Capital Holdings PLC declared a dividend payment of Rs. 2/- per share totaling Rs. 202.5Mn for 2017/18.

First Capital is an investment bank offering independent advice and transaction execution relating to capital raising and other strategic needs including mergers and acquisitions for investment in Sri Lanka. The Company’s industry leading transactions are reflective of the ingenuity in enabling the most opportune financing processes for our clients. First Capital’s services for investment in Sri Lanka include a total service for public offers of corporate debt, acting in the capacity of managers/ financial advisors and placement agents, in addition to due diligence, pre-offer preparation, offer management, distribution strategy and after-market advisory services, initial public offerings, secondary offerings such as rights issues, corporate actions including mandatory and voluntary offers, private placements and at-market placements of listed securities.

 

End

Sri Lankan shares slip; diversified stocks top drag

DIMANTHA MATHEW, HEAD OF RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

MAY 27, 2018

COLOMBO, May 25 (Reuters) – Sri Lankan shares closed slightly weaker on Friday as investors sold diversified stocks such as John Keells Holdings Plc, while block deals boosted turnover.

Local Investors continued to stay on the sidelines as they waited for some cues about the real impact of floods, while worries over a weaker rupee, political uncertainty and recent fuel price hike also weighed on sentiment.

Foreign investors accounted for around 70 percent of the day’s buying. They net bought equities worth 568.5 million rupees ($3.60 million), turning them net buyers of 272.3 million rupees so far this year.

The Colombo stock index ended 0.07 percent weaker at 6,467.80. It fell 0.4 percent for the week.

Turnover was 1.4 billion rupees, more than this year’s daily average of 983.6 million rupees.

“We see a reduction in foreign selling pressure and it is positive for the market,” said Dimantha Mathew, head of research, First Capital Holdings.

“Investors are still waiting to see the real impact of the floods.”

Heavy monsoon rains have killed 16 people, prompting authorities to warn against landslides and floods in low-lying areas after spill gates had to be opened across the Indian Ocean island.

Shares of Distillers Company of Sri Lanka Plc fell 2.7 percent, John Keells dropped 0.6 percent, Cargills (Ceylon) Plc ended down 1.8 percent and Sri Lanka Telecom Plc closed 1.5 percent weaker.

Stock brokers said investors were waiting for more clarity on the political and economic front amid recent fuel price hike, while the depreciation in rupee also weighed on sentiment.

The rupee hit a fresh low of 158.50 per dollar on May 16 on importer demand for the U.S. currency.

Analysts said concerns over political instability following President Maithripala Sirisena’s decision to suspend the parliament last month after 16 legislators from his ruling coalition defected, dented market sentiment.

On May 8, Sirisena urged his own coalition government and the opposition to end a power struggle to achieve ambitious goals including anti-corruption measures. ($1 = 157.9000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

Sri Lankan shares edge up from 1-week closing low

ATCHUTHAN SRIRANGAN, ASSISTANT  MANAGER – RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

May 24, 2018

COLOMBO, May 24 (Reuters) – Sri Lankan shares rose slightly on Thursday after posting their lowest close in more than one week in the previous session, as investors picked up beverage stocks while block deals lifted turnover.

Investors continued to stay on the sidelines as they waited for some cues about the real impact of floods, while worries over a weaker rupee, political uncertainty and recent fuel price hike also weighed on sentiment.

The Colombo stock index ended 0.1 percent firmer at 6,472.21, edging up from its lowest close since May 15 hit on Wednesday.

Turnover was 652.7 million rupees ($4.13 million), less than this year’s daily average of 979.6 million rupees.

The market will continue to move side ways until it sees a clear picture, said Atchuthan Srirangan, assistant manager-research at First Capital Holdings Plc.

Heavy monsoon rains have killed 12 people, prompting authorities to warn against landslides and floods in low-lying areas after spill gates had to be opened across the Indian Ocean island.

Foreign investors, who have been net sellers of shares worth 296.2 million rupees so far this year, net bought equities worth 300.8 million rupees on Thursday.

Shares of Distillers Company of Sri Lanka Plc rose 2.3 percent, Lion Brewery (Ceylon) Plc ended up 2.7 percent and Sri Lanka Telecom Plc closed 1.9 percent firmer.

Stock brokers said investors were waiting for more clarity on the political and economic front amid recent fuel price hike, while the depreciation in rupee also weighed on sentiment.

The rupee hit a fresh low of 158.50 per dollar on May 16 on importer demand for the U.S. currency.

Analysts said concerns over political instability following President Maithripala Sirisena’s decision to suspend the parliament last month after 16 legislators from his ruling coalition defected, dented market sentiment.

On May 8, Sirisena urged his own coalition government and the opposition to end a power struggle to achieve ambitious goals including anti-corruption measures. ($1 = 157.9000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

Weekly Government Securities Market – 24-05-2018

Stock Market Sri Lanka

By First Capital Holdings

Foreign Interest
Foreign holdings decreased by Rs 6.0 billion to record Rs 309 billion. Meanwhile, overall Government securities dipped marginally, resulting in the overall foreign holding percentage dipping to 6.1%
Maturities for next week
The Government securities market has Treasury bill maturities amounting to Rs 110.0 billion, while the Government also needs to settle a bond interest amounting to Rs 16.8 billion
Liquidity and CBSL Holdings
CBSL Holdings was on a constant level throughout the week at Rs 50.5 billion.

Atchuthan Srirangan, Assistant Manager – Research at First Capital Holdings, with the Market Review on Ada Derana – 20.05.2018

Stock Market Sri Lanka

First Capital’s Atchuthan Srirangan with the Market Review on Ada Derana

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management, retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.

First Capital is an investment bank offering services as Stock Brokers in Sri Lanka. The Company acts as a conduit between retail and institutional clients and the secondary market of the Colombo Stock Exchange. First Capital’s best-in-class research team provide a series of actionable trade recommendations, daily and periodic market commentaries and publications for Stock Brokers in Sri Lanka.

Sri Lankan shares close slightly higher; foreigners buy

DIMANTHA MATHEW, HEAD OF RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

MAY 23, 2018

COLOMBO, May 22 (Reuters) – Sri Lankan shares closed slightly stronger on Tuesday, driven by telecom stocks and as foreign investors continued to buy the island nation’s equities.

However, investors were cautious as they waited for some cues about the real impacts of floods, brokers said.

Heavy monsoon rains have killed eight people, prompting authorities to warn against landslides and floods in low-lying areas after spill gates had to be opened across the Indian Ocean island.

The Colombo stock index ended 0.1 percent firmer at 6,472.25, edging up from its lowest close since May 15 hit on Monday.

Foreign investors, who have been net sellers of shares worth 573.5 million rupees ($3.63 million) so far this year, net bought equities worth 73.3 million rupees on Tuesday. They net purchased shares worth 152 million rupees on Monday.

“Some block deals pushed the turnover today. Other than that the market was very dull as investors were on the sidelines to asses the real impact of the floods,” said Dimantha Mathew, head of research, First Capital Holdings.

Shares of Dialog Axiata Plc rose 2.8 percent, Distilleries Company of Sri Lanka Plc ended 0.9 percent higher and Sri Lanka Telecom Plc closed 1.6 percent firmer.

Turnover was 777.4 million rupees, less than this year’s daily average of 991.1 million rupees.

Stock brokers said investors also waited for more clarity on the political and economic front amid recent fuel price hike, while the depreciation in rupee also weighed on sentiment.

The rupee hit a fresh low of 158.50 per dollar on Wednesday on importer demand for the U.S. currency.

Analysts said concerns over political instability following President Maithripala Sirisena’s decision to suspend the parliament last month after 16 legislators from his ruling coalition defected, dented market sentiment.

On May 8, Sirisena urged his own coalition government and the opposition to end a power struggle to achieve ambitious goals including anti-corruption measures. ($1 = 157.8500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

Weekly Government Securities Market – 18-05-2018

Stock Market Sri Lanka

Secondary market yield curve shifted upwards throughout the week and selling interest was seen actively on the 2019 maturities this past week. At the Primary bill auction 1-Yr bill saw its yield increasing by 5bps and the 3M bill was accepted at 8.33% nad its yield increased by 22bps. Despite being offered, the 6M bills was rejected for the twelth consecutive week. Overall market witnessed moderate volumes.


Liquidity & CBSL Holdings

CBSL Holdings was on a constant level throughout the week at LKR 50.5Bn.
Foreign Interest

Foreign holding decreased by LKR 4.1Bn to record at LKR 315Bn. Meanwhile, the overall government securities improved however, the overall foreign holding percentage dropped to 6.2%.
Maturities for next Week
The Government securities market has Treasury Bill maturity amounting to LKR 28.0Bn.

Sri Lankan shares slip from 1-week high in thin trade

DIMANTHA MATHEW, HEAD OF RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

MAY 18, 2018

COLOMBO, May 17 (Reuters) – Sri Lankan shares ended slightly weaker on Thursday, slipping from a one-week high hit in the previous session, as investors sold diversified shares such as John Keells Holdings Plc.

Trading was thin as investors awaited for more clarity on the political and economical front.

The Colombo stock index ended 0.16 percent weaker at 6,473.18, slipping from its highest close since May 9 hit on Wednesday.

“The market today came down on John Keells. The market is hovering around these levels as investors are still on the sidelines,” said Dimantha Mathew, head of research, First Capital Holdings.

“There are queries from investors, but nobody is taking the initiation to invest as yet.”

Turnover stood at 484.6 million rupees ($3.07 million), less than half of this year’s daily average of 1 billion rupees.

Foreign investors net sold equities worth 77.8 million rupees, extending the year-to-date net foreign outflow to 747.3 million rupees worth of shares.

Meanwhile, the recent fuel price hike also weighed on investor sentiment, stockbrokers said.

State-run Ceylon Petroleum Corp (CPC) raised retail prices for gasoline and diesel on Thursday midnight in response to the hike in global oil prices. Lanka IOC, a subsidiary of Indian Oil Corp, also increased fuel prices the same day.

Shares of John Keells Holding Plc ended 0.8 percent weaker, while the biggest listed lender Commercial Bank of Ceylon Plc closed 0.6 percent lower.

Shares of Lanka IOC ended 0.6 percent weaker.

The depreciation in rupee also weighed on the market, analysts said, as it is likely to hit profits of some listed firms that rely heavily on imports.

The rupee hit a fresh low of 158.50 per dollar on Wednesday on importer demand for the U.S. currency.

Analysts said concerns over political instability following President Maithripala Sirisena’s decision to suspend the parliament last month after 16 legislators from his ruling coalition defected, dented market sentiment.

Last week, Sirisena urged his own coalition government and the opposition to end a power struggle in order to achieve ambitious goals including anti-corruption measures.

$1 = 158.0000 Sri Lankan rupees Reporting by Ranga Sirilal and Shihar Aneez, Editing by Sherry Jacob-Phillips