Tag Archives: Investment banks in Sri Lanka

Weekly Government Securities Market – 26-01-2018

The yield curve remained mostly unchanged, while overall market saw thin volumes amidst market participants continuing to adopt a wait-and-see approach, ahead of the bond auction to be held next week. The bill auction saw mixed results, with yield of the 6-month bill dipping by 1bps while the 1-year bill saw its yield increasing by 5bps amidst CBSL accepting lower volumes for 1-year bill. During the week, foreigners continued to dominate market activities.

First Capital Holdings PLC is an investment bank and is the pioneer non-bank affiliated Primary Dealer in Treasury Bills and Bonds in Sri Lanka. With a track record of over 25 years, the Company was the first licensed primary dealer appointed by the Central Bank, and is also the only listed and rated primary dealer in Treasury Bills and Bonds in Sri Lanka.
First Capital delivers the only source for fixed income research in the local financial services industry. The Company’s best-in-class research team provide dynamic reports including economic reviews and proprietary research, encompassing fundamental, quantitative and technical analysis.

Sri Lankan shares end down on profit-taking

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

JANUARY 11, 2018

COLOMBO, Jan 10 (Reuters) – Sri Lankan shares ended weaker on Wednesday as investors sold blue chips such as Ceylon Tobacco Co, but foreign investors’ appetite for risky assets limited the downslide.

The Colombo Stock Index ended 0.4 percent weaker at 6,502.96.

Turnover stood at 376 million rupees ($2.45 million) on Wednesday, well below last year’s daily average of 915.3 million rupees.

Foreign investors, which accounted for more than 65 percent of the day’s buying, net bought shares worth 18.2 million rupees on Wednesday, extending the net foreign inflow in this year to 2.23 billion rupees.

They had net bought 18.5 billion rupees worth equities in 2017 and 633.5 million rupees in 2016.

“Market is consolidating with some profit-taking,” said Dimantha Mathew, head of research, First Capital Holdings.

“We don’t see a big run at the moment. It won’t come down drastically but the market will consolidate at these levels before the next move.”

Analysts expect the market to settle at 6,600 levels.

Ceylon Tobacco Company Plc ended 3.3 percent down, while Hatton National Bank Plc closed 0.8 percent lower.

Treasury bill rates fell between March and December last year, mainly driven by foreign buying in treasury bonds, resulting in a decline in interest rates.

The country’s 2018 economic growth trajectory is likely to help boost market sentiment, analysts said.

Sri Lanka’s economic growth in 2018 is forecast at 5-5.5 percent, against an anticipated four-year low of less than 4 percent last year, central bank governor Indrajit Coomaraswamy said last week.

$1 = 153.7500 Sri Lankan rupees Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sherry Jacob-Phillips

First Capital is an investment bank providing a full range of financial advisory and services. The Company’s research deliver heightened perspective in fundamental research aiding Share Market Investment in Sri Lanka. The Company’s best-in-class research team provide dynamic reports including economic reviews and proprietary research, encompassing fundamental, quantitative and technical analysis. With fundamental research coverage of 62 listed securities (reflecting approximately 65% market capitalization) across 15 sectors in Share Market Investment in Sri Lanka.

Sri Lankan shares climb to near 7-week high; Keells leads

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

JANUARY 9, 2018

COLOMBO, Jan 8 (Reuters) – Sri Lankan shares rose on Monday to a near seven-week high as blue chip shares such as John Keells Holdings Plc gained, while foreign investors continued to buy the island nation’s risky assets.

The Colombo Stock Index ended 0.4 percent firmer at 6,540.51, its highest close since Nov. 10.

The bourse rose 2.3 percent last week, in its second straight weekly gain.

Foreign buying accounted for 61.2 percent of the day’s turnover of 1.7 billion rupees.

Foreign investors net bought shares worth 33.9 million Sri Lankan rupees ($220,559.53) on Monday, extending the net foreign inflow in this year to 2.0 billion rupees.

They had net bought 18.5 billion rupees worth equities in 2017 and 633.5 million rupees in 2016.

“The buying interest is continuing as investors are quite bullish,” said Dimantha Mathew, head of research at First Capital Holdings.

“There was a lot of foreign trading and investors are buying blue chip shares like John Keells. We expect the market to settle at 6,600 levels and there could be some profit-taking at those levels.”

Shares in conglomerate John Keells Holdings Plc rose 3.1 percent, Nestle Lanka Plc gained 3.5 percent and Lion Brewery Plc climbed 4.6 percent.

Analysts said the positive trend will continue due to declining market interest rates.

Treasury bill rates fell 188 basis points to 216 basis points between March and end-December 2017, mainly driven by foreign buying in treasury bonds, resulting in declining market interest rates.

The country’s 2018 economic growth trajectory is likely to help boost market sentiment, analysts said.

Sri Lanka’s economic growth in 2018 is forecast at 5-5.5 percent, against an anticipated four-year low of less than 4 percent last year, central bank Governor Indrajit Coomaraswamy said on Wednesday.

The central bank kept its benchmark interest rates unchanged last week, saying inflation and private sector credit growth have cooled to manageable levels as policy makers focus on supporting a slowing economy. ($1 = 153.7000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Vyas Mohan)

First Capital is an investment bank providing a full range of financial advisory and services. The Company’s research deliver heightened perspective in fundamental research aiding Share Market Investment in Sri Lanka. The Company’s best-in-class research team provide dynamic reports including economic reviews and proprietary research, encompassing fundamental, quantitative and technical analysis. With fundamental research coverage of 62 listed securities (reflecting approximately 65% market capitalization) across 15 sectors in Share Market Investment in Sri Lanka.

Sri Lanka keeps rates steady to support a sluggish economy

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

DECEMBER 28, 2017

COLOMBO, Dec 28 (Reuters) – Sri Lanka’s central bank kept its benchmark interest rates unchanged on Thursday, saying inflation and private sector credit growth have cooled to a manageable level as policy makers focus on supporting a slowing economy.

The monetary authority said high food prices caused by supply disruptions could keep headline inflation somewhat elevated in the immediate future, but prices are expected to return to the desired level towards the end of first quarter of 2018.

“Although near term growth prospects remain subdued, it is anticipated that the economy would recover in 2018 due to continuous surge in exports and investments induced by foreign direct investments,” the central bank said in a statement.

As widely expected, the central bank kept the standing deposit facility rate (SDFR) at 7.25 percent and standing lending facility rate (SLFR) at 8.75 percent. The previous rate increases have dragged on the $81 billion economy, which grew at an annual pace of 3.7 percent in the first nine months of 2017, lagging the 4.0 percent growth in the year-ago period.

In a post-policy press briefing, central bank chief Indrajit Coomarswamy said growth is expected to come in below 4 percent for this year, shaving off further from its downgrade last month of output to expand between 4 percent and 4.5 percent.

The original 2017 growth forecast was 5.0 percent. The country was hit by the most severe drought in 40 years in the first quarter and the worst flooding in 14 years in May.

The central bank said the yields on government securities have eased from their peak, correcting some disparity that existed between the policy rates and the yields on sovereign securities.

The International Monetary Fund (IMF) earlier this month urged Sri Lanka to maintain a tightening bias on monetary policy until clear signs emerge that inflationary pressures and credit growth are moderating. Coomaraswamy last month told Reuters that the monetary authority does not see a need for a rate rise because core inflation is running low. L3N1NY51C]

The central bank has said it wants to curb credit growth to 15 percent by year-end. Annual private sector credit growth slowed to 15.4 percent in November, well off a near four-year high of 28.5 percent hit in July 2016.

Consumer inflation was up 7.6 percent in November from a year earlier, slowing from a record high of 7.8 percent hit in the previous month. Core inflation, which excludes volatile commodities, slowed to 5.2 percent last month from 5.8 percent in October.

“At the moment things are in line. The concern is that the GDP has slowed down and the credit growth is also slowing down. If the slow down continues, there is a possibility of cutting rates,”said Dimantha Mathew, head of research at First Capital Holdings.

But he said the central bank would be watchful until the long-delayed local government election scheduled for Feb. 10.

The central bank has tightened monetary policy four times since December 2015 through March this year to fend off pressure on the fragile rupee and curb stubbornly high credit growth that stoked inflation.

 

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 providing a full range of financial advisory and services. The Company’s research deliver heightened perspective in fundamental research aiding Share Market Investment in Sri Lanka. The Company’s best-in-class research team provide dynamic reports including economic reviews and proprietary research, encompassing fundamental, quantitative and technical analysis. With fundamental research coverage of 62 listed securities (reflecting approximately 65% market capitalization) across 15 sectors in Share Market Investment in Sri Lanka.

Sri Lankan stocks hit 3-wk closing high in holiday-thinned trading

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

DECEMBER 27, 2017

COLOMBO, Dec 27 (Reuters) – Sri Lankan shares touched a near three-week closing high on Wednesday as investors waited for clues from the central bank’s monetary policy review later in the week, with trading muted by the holidays after Christmas.

Sri Lanka’s central bank is expected to keep its key interest rates unchanged this week, a Reuters poll showed, as policymakers focus on supporting the slowing South Asian economy while remaining vigilant to still high inflationary pressures.

The Colombo Stock Index ended 0.14 percent firmer at 6,359.06, its highest since Dec. 8.

“Trading blue chip counters moved up slightly helping the index to end positive but the market is very dull as most of the brokers and investors are on holiday,” said Dimantha Mathew, head of research at First Capital Holdings.

Shares in Peoples Leasing Plc rose 0.6 percent, while Overseas Realty Plc ended 2.9 percent higher and Hemas Holdings Plc gained 0.8 percent.

Turnover stood at 263.3 million rupees ($1.73 million), just above a quarter of this year’s daily average of 920.5 million rupees.

Foreign investors sold 130.1 million rupees net worth of shares on Wednesday, but they have bought 18.2 billion rupees net worth equities so far this year. ($1 = 152.6000 Sri Lankan rupees) (Reporting by Ranga Sirilal; Editing by Amrutha Gayathri)

First Capital is an investment bank providing a full range of financial advisory and services. The Company’s research deliver heightened perspective in fundamental research aiding Share Market Investment in Sri Lanka. The Company’s best-in-class research team provide dynamic reports including economic reviews and proprietary research, encompassing fundamental, quantitative and technical analysis. With fundamental research coverage of 62 listed securities (reflecting approximately 65% market capitalization) across 15 sectors in Share Market Investment in Sri Lanka

First Capital’s Amanda Lokugamage with the Market Review on Ada Derana – 26.12..2017

First Capital’s Amanda Lokugamage 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.

First Capital records Rs. 231 Mn PAT 2016/17

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Director / Group CEO, Dilshan Wirasekara

Colombo 19th June 2017: First Capital Holdings PLC, a full service investment bank providing a diverse range of advisory services and financial products through its subsidiaries, (First Capital Group) reported a consolidated profit after tax of Rs. 231Mn for the year 2016/17 compared to Rs. 47Mn in the previous year.

The Group’s primary dealer arm, First Capital Treasuries PLC, was the main contributor towards the financial results recording a profit after tax of Rs. 343Mn for the year 2016/17 (2015/16 – Rs. 11Mn) attributed to net interest income and fair valuation gains on government securities. First Capital Treasuries, is the pioneer non-bank Primary Dealer appointed by Central Bank in 1982 and is listed on the Colombo Stock Exchange. Further, the company’s credit rating was reaffirmed by ICRA Lanka as A- with stable outlook.

The capital markets advisory of the Group, First Capital Limited, which specialises in structuring and placement of corporate debt securities, successfully mobilised Rs. 12.4Bn through structuring and placement of corporate debt securities. Despite the above performance First Capital Limited was negatively affected as a result of higher funding cost and fair valuation losses on trading securities.

The performance of the Group’s subsidiaries were further impacted due to damped investor sentiments as a result of the proposed changes to taxation via the budget proposal – 2017.

“Despite the setback experienced in the preceding quarters, the Group is optimistic in its outlook and have planned several calculated improvements to its operations” said Director / Group CEO, Dilshan Wirasekara.

 

First Capital Holdings PLC (the Company or First Capital) is a full service investment bank providing a diverse range of advisory services and financial products.

We currently serve an array of companies, institutions, government agencies, high net worth individuals and retail clients both international and local, who seek truly objective advice, innovative solutions and execution expertise. We operate throughout Sri Lanka via offices in Colombo, Kandy, Matara and Kurunegala. Our global outreach continues to expand through institutional trading and investment product placement.

As a company listed on the Colombo Stock Exchange (CSE) since 1994 (Ticker: CFVF), we exemplify requisite financial transparency and governance standards.

Reflecting credit fundamentals including a robust capital structure, liquidity, risk controls and earnings profile, we are rated A- by ICRA Lanka Limited.

Monetary Policy Review – Monthly Economic Watch – May 2017

Policy rates unchanged
Private sector credit growth decelerated gradually to 21.0% in February 2017 and 20.4% in March 2017. The Earlier tightening of monetary policy by central bank and resultant increase in interest rates impacted the credit growth.
Combined impact of the decline in export earning and increased expenditure on imports as a result of the drought conditions expanded Trade deficit to USD 1.7Bn till February 2017.
Gross official reserves dipped to USD 5.1Bn by end April 2017 from USD 6.0Bn by end 2016. Both the government securities market and the Colombo Stock Exchange experienced foreign inflows in recent months.

Accordingly policy rates were increased,

  • Standing Deposit Facility Rate – 7.25%
  • Standing Lending Facility Rate – 8.75%
  • Statutory Reserve Ratio (SRR) – 7.50%
Read the full report –

https://www.firstcapital.lk/wp-content/uploads/2015/06/Monthly-Economic-Watch-May-2017.pdf

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 proving services to invest in Sri Lanka through fixed income securities such as investments 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.

Changes to the Board of Directors of Dunamis Capital PLC and its listed subsidiaries First Capital Holdings PLC and Kelsey Developments PLC

Colombo, 02nd May 2017 – The Executive Chairperson of Dunamis Capital PLC and its listed subsidiaries First Capital Holdings PLC and Kelsey Developments PLC, Mrs. Manjula Mathews has retired from her post with effect 30th April 2017.

Mrs. Mathews, a Fellow Member of the Chartered Institute of Management Accountants (UK) and an Alumnus of the University of Cambridge (UK), assumed duties as the Group’s Executive Chairperson in October 2014. Prior to this she served as Group Managing Director from 2007-2014. Her decision to step down from her leadership role was in line with plans made a considerable while ago.

Mrs. Mathews is succeeded as Chairman of Dunamis Capital PLC and Kelsey Developments PLC by Mr. Eardley Perera, who has been an Independent Non-Executive Director of the company since 2012. Mr. Perera a Chartered Marketer, is a Graduate of the Chartered Institute of Marketing (UK), with over 40 years of experience in management. He is also a member on the Board of Study of the Postgraduate Institute of Management, University of Sri Jayewardenepura (PIM) and is actively engaged in management education and consultancy.

Mr Eardley Perera

The role Chairman of First Capital Holdings PLC is assumed by Mr. Nishan Fernando, who has been an Independent Non-Executive Director of the company since 2012. He is a Fellow Member of the Institute of Chartered Accountants of Sri Lanka, an Associate Member of the Chartered Institute of Management Accountants (UK) and holds an MBA from the Postgraduate Institute of Management of the University of Sri Jayewardenepura. Mr. Fernando is a past president of the Institute of Chartered Accountants of Sri Lanka and was a Board Member of the Securities and Exchange Commission of Sri Lanka.

Mr. Nishan Fernando

Mr. Eardley Perera and Mr. Nishan Fernando are respected business professionals with impressive track records. Their appointments further increase the independence and transparency of the Board of both Companies.

The Board of Directors has appointed Mr. Dilshan Wirasekara, incumbent Chief Executive Officer of First Capital Holdings PLC as Executive Director of First Capital Holdings PLC with effect from 1st May 2017.  He is an alumnus of INSEAD Business School, with over 20 years of experience in financial services.

R I L Property Limited (RIL) – Initial Public Offer

First Capital Research Reports on RIL Property’s recent IPO

Company Profile:

Incorporated in 2009, RIL is an owner, developer and manager of Grade ‘A’ commercial office space in Colombo. RIL focuses on offering multi-faceted real estate solutions including facilities management, leasing, land acquisition, construction management services, consulting and strategic investment. The company’s flagship asset, Parkland, currently has an occupancy of 90.4% and about 60% of the tenants are foreign. RIL also owns FoodBuzz (Private) Limited (FBPL), a food and beverage company which is a franchisee of the BreadTalk Group based in Singapore.

Growth Prospects:

Parkland’s tenant base has a Weighted Average Lease Expiry (WALE) of 3 years and introductory rates offered to initial clients are expected to be re-priced upon renewal of the respective lease agreements. Furthermore a specific clause in the lease agreements ensures a 10% increase in rentals every 2 years.

The expansion project for FBPL involves increasing the number of BreadTalk outlets from 7 in FY17 to 16 in FY21. This would provide the potential for growth in cash flow generation.

The refurbished Readywear building will be ready for occupancy by June 2018 and would add 194,345 sq. ft. of Net Rentable Area (NRA). Furthermore RIL has a vacant property on Park Street with a land extent of 155 perches, and based on market conditions, the company plans to utilize it for large scale commercial office space development.

RIL also plans to dispose of the Morgan Road property in FY18/19 for LKR 1.3Bn (net of capital gains taxes) and utilize the proceeds for future office space developments. In addition to this, given the company’s strong balance sheet and cash flows, the company has the potential to raise further debt if required.

Read the full report here

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.