Tag Archives: Corporate finance advisory services in Sri Lanka

Sri Lankan Shares Close at 1-month Low in Thin trade

First Capital’s Senior Research Analyst, Atchuthan Srirangan, speaks to Reuters Thu Oct 20, 2016

Sri Lankan shares ended slightly weaker on Thursday, posting their lowest close in a month, as investors awaited next month’s national budget and a flurry of corporate results. The benchmark index of the Colombo Stock Exchange ended 0.03 percent or 2.03 points lower at 6,442.36, its lowest close since Sept. 20, in thin trading.

“Investors are waiting to see the outcome of the budget and quarterly results,” said Atchuthan Srirangan, a senior research analyst with First Capital Equities (Pvt) Ltd. “Market will move sideways until the budget,” he said.

Stockbrokers said the market was digesting political concerns over the resignation of the head of Sri Lanka’s anti-corruption body on Monday, a few days after President Maithripala Sirisena implied that the agency was favouring the rival party of his prime minister. This is likely to delay one of the promises of Sirisena’s coalition government to eliminate corruption and could hurt business confidence, analysts said.

Turnover stood at 365.03 million rupees ($2.50 million), well below this year’s daily average of around 739.4 million rupees. Foreign investors, who have sold a net 2.06 billion rupees worth of shares so far this year, bought a net 39.1 million rupees worth equities on Thursday.

Top conglomerate John Keells Holdings Plc ended 0.66 percent weaker while Cargills (Ceylon) Plc fell 4.61 percent. Sri Lanka’s quarterly earnings season started last week but the bulk of locally listed firms will not report until late October or early November.

($1 = 145.9000 Sri Lankan rupees)

(Reporting by Ranga Sirilal; Editing by Amrutha Gayathri)

First Capital’s A- rating was reaffirmed by ICRA Lanka

The issuer rating of SL[A-] with stable outlook was reaffirmed for First Capital Holdings PLC (FC) by ICRA Lanka Limited, subsidiary of ICRA Limited, a group company of Moody’s Investors Service.

ICRA Lanka also reaffirmed the issuer rating [SL]A- with stable outlook for First Capital’s standalone primary dealer First Capital Treasuries PLC (FCT).

The rating report noted potential improvement in the business and financial performances of FCH’s other business entities, which are engaged in corporate debt structuring, corporate finance, asset management, stock broking, extending margin trading facilities and trustee services.

FCH, being a holding company derives its income from the dividends from the group entities and income from its investments, which includes interest income and profit from investments. Total standalone income for FY2016 was adversely affected (LKR 350 Mn total income in FY2016 vis a vis LKR 590 Mn in FY2015) due to non-availability of dividend income (LKR 212 Mn in FY2015), which is linked to performance of the principal subsidiary, FCT. The expected improvement in the performance of FCT in FY2017 vis a vis FY2016, is likely to support the overall performance of FCH.

First Capital power 37th National Conference of Chartered Accountants with Gold

First Capital Holdings PLC has committed to power the 37th National Conference of Chartered Accountants with Gold sponsorships.

The annual flagship event, organised by the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) is to be held from 19 to 21 October, under the theme ‘Unleashed Thinking: Entrepreneurship and Intrapreneurship.’ The conference which has built a reputation as a leading business summit in the country, is expected to attract over 1,500 business leaders including chartered accountants and leaders from other professions.

First Capital Holdings Group Chief Executive Officer Dilshan Wirasekara said that First Capital is delighted to sponsor a benchmark event such as the National Conference of Chartered Accountants for the third successive year. “We see the impact that national level events such as this conference have on the maintenance of high professional standards and practices across the industry as Sri Lanka’s capital market enters the next phase of growth,” he said.

“This year’s conference is expected to focus on the potential of entrepreneurship and intrapreneurship, specifically on how it can benefit Sri Lanka to drive the country to the next level, boosting its standing as a global player in the international business arena.
Reputed as a business summit, the conference aims to stimulate vibrant innovative entrepreneurs and intrapreneurs whilst establishing high profile market leading companies to be ready for the new challenges that they will have to face as a result of disruptive technology, consumer demand and the aspirations of millennial workforce,” he said.

Welcoming the companies onboard, CA Sri Lanka President Lasantha Wickremasinghe said as a highly respected professional organization, the institute takes it upon their responsibility to give the necessary boost not only to enhance the standing of the accounting and finance professions, but also to be a catalyst in helping Sri Lanka’s achieve its growth goals.

“As a country, we have great potential to be a global player, and we believe this summit which attracts a significant representation of corporate leadership, will be the perfect platform to promote and stimulate upon the importance where both entrepreneurs and intrapreneurs  can take the lead to help Sri Lanka achieve it’s true potential,” Wickremasinghe said.

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First Capital Chief Executive Officer Dilshan Wirasekara, Senior Manager – Business Development and Corporate Planning Kosala Liyanagedara and Manager Branding and Marketing Services Nisansala Munasinghe exchanging the sponsorship cheque with CA Sri Lanka President Lasantha Wickremasinghe, Vice President Jagath Perera, Conference Committee Chairman Tishan Subasinghe and CEO Aruna Alwis
First Capital Chief Executive Officer Dilshan Wirasekara, Senior Manager – Business Development and Corporate Planning Kosala Liyanagedara and Manager Branding and Marketing Services Nisansala Munasinghe exchanging the sponsorship cheque with CA Sri Lanka President Lasantha Wickremasinghe, Vice President Jagath Perera, Conference Committee Chairman Tishan Subasinghe and CEO Aruna Alwis

Unit Trust Solutions

First Capital Holdings PLC is a full-service investment bank with a 30-year history, which offers an array of investment solutions to its clients including services in capital markets advisory, fixed income, equities and wealth management.

The company’s wealth management suite serves individual and institutional investors through unit trusts, financial planning and discretionary portfolio management.

Currently, the company is focusing on promoting its unit trust products to the market, which offers a low-risk investment option. Unit trusts are well suited for both corporates and individuals, as it allows for capital to be invested and managed professionally. The unit trusts funds act as a pooling vehicle in which funds from multiple investors are accumulated, allowing for larger investment in certain instruments with negotiated terms.

First Capital unit trusts products cater to a large base of high-net-worth and institutional clientele including SME and mid-level corporates.

The funds are managed by professional fund managers, who ensure that risks are diversified over a multitude of assets, while the largest state bank, the Bank of Ceylon acts as an independent trustee. Investors are given further peace of mind through the stringent monitoring and regulatory control of the unit trust industry by the Securities Exchange Commission (SEC).

Globally, the unit trust sector asset  base exceeds that of the banking sector. According to the Central Bank of Sri Lanka the bank deposits at LKR 4.7 trillion as at year end 2014, is leaps ahead of industry assets under management LKR 133 billion. Considering the tax exemptions given to unit trusts investments and that retail investors are seeking higher-yield alternative investments away from conventional bank-deposits, the company sees potential for growth in this segment.

Striving to excel in its customer centricity, First Capital encourages potential investors to consider their risk appetite, objectives, and purpose for investing prior to getting involved, ensuring that customers choose the most fitting investment option. “We profile the client, looking at age, responsibilities and commitments, and help them understand what sort of risk they should be taking, to fulfil their goals in life,” explains CEO, Dilshan Wirasekara. The company conducts financial planning on behalf of its clients to help them assess where they stand in relation to achieving their goals.

First Capital has a range of unit trust products targeting varying investor requirements. For the passive investor, it provides a gilt-edged fund, which invests purely in government securities, while providing a money-market fund for moderate risk-takers giving a return of 7-8% per annum, giving a higher rate than short-term bank deposits.   For the more aggressive risk-takers who want high returns, the company offers an equity fund, maintained on ethical grounds.

The company’s flagship unit trust fund – First Capital Wealth Fund was the best-performing fund in its category in 2013 and 2014, and has outperformed the unit trust industry in terms of Annual Equivalent Rate (AER) for the five years ended December 2015.

First Capital even offers customised portfolio management for investors with larger funds, and provides investment advice covering many business sectors.

Wirasekara comments: “The Company differentiates itself by the ability to navigate varying market cycles in multiple asset classes. Its superior performance in unit trust is a result of the ability to identify advantageous trends coupled with exemplary risk management.”

First Capital’s asset management business is only one aspect of its total offering. “We are a fully-fledged investment bank, having many other business lines,” avers Wirasekara adding that “being a primary dealer, we have insights into the bond market and interest-rate direction.” As testimony, First Capital claims to have been the largest manager of debt issuance in the market last year, raising LKR 25 billion of debt.

The company enjoys an unparalleled advantage with its research-backed market insights and expertise, which enables its fund managers to make notable capital gains by capitalising on movement, through risk mitigation and locking-in long-term rates at high yields.

First Capital has extended its local footprint through branches in Colombo, Kandy, Matara and Kurunegala. The company is geared for its journey towards growth in unit trust investments and customer-centric wealth management.

 

Published in May 2016 on the LMD Magazine – Digest Segment on Wealth Management