Tag Archives: share market investments sri lanka

Sri Lankan shares fall to 4-mth closing low; blue chips drag

FIRST CAPITAL’S SENIOR RESEARCH ANALYST ATCHUTHAN SRIRANGAN SPEAKS TO REUTERS

August 16, 2017

COLOMBO, Aug 16 (Reuters) – Sri Lankan shares fell for a fourth consecutive session on Wednesday, posting their lowest close in four months, as local investor sentiment remained muted following a string of disappointing June-quarter corporate results.

However, the decline was limited as foreign investors bought into equities.

The Colombo stock index fell 0.36 percent, or 23.50 points, to 6,417.41, its lowest close since April 18.

It declined in 13 of the last 14 sessions, while yields on short-term government securities also fell over the past two weeks.

“The market came down on blue chips. The main reason for the market to come down is the poor quarterly earnings,” said Atchuthan Srirangan, a senior research analyst at First Capital Holdings PLC.

Foreign investors bought shares worth a net 98.3 million rupees (about $641,854) on Wednesday, extending the year-to-date net inflow to 27.6 billion rupees.

Turnover was 780.3 million rupees, less than this year’s daily average of around 875.3 million rupees.

Shares of market heavyweight John Keells Holdings fell 0.5 percent, Carson Cumberbatch Plc dropped 3.2 percent, Melstacorp Plc ended 0.8 percent weaker and Ceylon Cold Stores declined 0.8 percent.

Pan Asia Banking Corp (PABC), which had its primary dealer status suspended by the central bank on Tuesday for six months, fell 2.4 percent. ($1 = 153.1500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

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.<

Sri Lankan shares post steepest drop in 5 mths despite foreign buying

FIRST CAPITAL’S SENIOR RESEARCH ANALYST ATCHUTHAN SRIRANGAN SPEAKS TO REUTERS

August 15, 2017

COLOMBO, Aug 15 (Reuters) – Sri Lankan shares posted their worst decline in nearly five months on Tuesday, as local investor sentiment remained muted, after a string of disappointing June-quarter corporate results.

However, foreign investors bought the island nation’s risky assets, with offshore buying accounting for more than 80 percent of the session’s turnover.

The Colombo stock index fell 0.69 percent, or 44.85 points, to 6,440.91, its lowest close since April 18. The index posted its steepest percentage fall since March 22.

“It was mainly on poor quarterly earnings. The retail segment is hit hard after the last-quarter floods. Banks are hit by non-performing loans and some companies are hit by rise in global commodity prices,” said Atchuthan Srirangan, a senior research analyst at First Capital Holdings PLC.

“Local investors are waiting, but foreign investors are buying heavily because they see Sri Lankan bourse is under-valued compared to some other regional peers.”

Foreign investors bought shares net worth 788.5 million rupees ($5.15 million) on Tuesday, extending the year-to-date net inflow to 27.6 billion rupees.

This accounted for about 82 percent of the day’s turnover, which came in at 1.12 billion rupees, higher than this year’s daily average of around 875.9 million rupees.

The stock market has posted losses in 12 out of the last 13 sessions, while yields on short-term government securities also fell over the past two weeks.

Sri Lanka’s Supreme Court said early this month that a major tax reform proposed by the government cannot be passed into law in its current form, unless it is approved by more than a two-third majority vote in parliament and gets the greenlight from a nationwide referendum.

Shares in the market heavyweight John Keells Holdings fell 2.5 percent, while Ceylon Cold Stores fell 4.1 percent.

Shares in Pan Asia Banking Corp (PABC), which had its primary dealer status suspended by the central bank on Tuesday for six months, fell 0.7 percent.

$1 = 153.1500 Sri Lankan rupees Reporting by Shihar Aneez; Editing by Amrutha Gayathri

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 Fixed Income Recommendation – August 2017

  • Economic Health Score

  • Recommendation

  • Recap of Dec 2016 Economic Wrap

Read the full report – First Capital Fixed Income Recommendation August 2017

 

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.

MARKET UPDATE ON ADA DERANA ENGLISH NEWS – 13.08.2017

Stock-Brokers in Sri Lanka

First Capital’s Head of Research Dimantha Mathew with the market update – between 19.22 mins to 19.59 mins.

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.

Monthly Economic Watch – August 2017

Monetary Policy Review – Aug 2017

Policy rates unchanged

  • The recovery of the agriculture related activities and the positive performance of the industry and services related activities together with the reinstatement of GSP+ facility are expected to contribute to economic growth. Headline inflation moderated at a faster pace to 4.8% in Jul 2017.
  • Private sector credit growth further decelerated to 18.6% in June 2017 compared to 18.9% in May 2017 owing to high nominal and real interest rates prevailed in the market.
  • Despite improved export performance, a sustained increase in import expenditure resulted in a trade deficit of USD 4.2Bn till May 2017
  • Gross official reserves dipped to USD 6.7Bn in July from USD 7.0Bn in Jun 2017. Sri Lanka received the third tranche of the IMF-Extended Fund Facility (EFF) amounting to USD 167.2Mn. Both the government securities market and the Colombo Stock Exchange experienced noticeable foreign inflows.
  • Accordingly policy rates were decided to be maintained at,
    • Standing Deposit Facility Rate – 7.25%
    • Standing Lending Facility Rate – 8.75%
    • Statutory Reserve Ratio (SRR) – 7.50%

Read the full report here: Monthly Economic Watch – August 2017

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.

Sri Lankan shares recover from over 3-mth low on bargain hunting

FIRST CAPITAL’S HEAD OF RESEARCH DIMANTHA MATHEW SPEAKS TO REUTERS

August 10, 2017

COLOMBO, Aug 10 (Reuters) – Sri Lankan shares recovered from a three-and-a-half month low on Thursday, snapping a nine-session losing streak, as investors bought battered shares.

The Colombo stock index rose 0.16 percent, or 10.29 points, to 6,516.32, edging up from its lowest close since April 25 hit on Wednesday. It fell 1.5 percent last week in its third straight weekly drop.

“Market moved up on bargain hunting and (there was) less selling pressure. We have seen the bottom for the moment and we have to see whether it will sustain,” said Dimantha Mathew, head of research at First Capital Holdings.

Mathew said the resignation of Sri Lanka’s foreign minister Ravi Karunanayake, a former finance minister, also helped boost the market.

Sri Lanka’s foreign minister resigned on Thursday over corruption charges in an investigation of alleged irregularities in government bond sales, maintaining that he was not guilty of wrongdoing.

“The resignation reduces risk of a splintering in the governing coalition,” said Hasnain Malik, Global Head of Equities Research at London-based frontier markets investment bank Exotix Capital, active in South Asia.

The coalition government between President Maithripala Sirisena’s centre-left party and Prime Minister Ranil Wickremesinghe’s centre-right party had differences over the alleged corruption deal, risking the stability of the government.

“We regard Sri Lanka equities as cheap versus history and the exchange rate as lower risk than before, now it is under the IMF umbrella, but we still see a struggle for sustainable growth,” Malik said in an emailed comment.

Foreign investors net bought shares worth 98.5 million Sri Lankan rupees ($642,740.62) on Thursday, extending their year-to-date net inflow to 26.7 billion rupees.

Turnover stood at 306.6 million rupees, less than half of this year’s daily average of around 880.6 million rupees.

Shares of Dialog Axiata Plc rose 0.9 percent while, Ceylon Tobacco Company Plc gained 1.1 percent and Sampath bank Plc ended 2.9 percent higher.

Analysts, however, expect equities to gain due to a fall in government bond yields.

Short-term treasury-bond yields fell between 10 basis points (bps) and 16 bps at a weekly auction on Wednesday, while the yields on a 59-month bond dropped by 99 bps and that on a 118-month bond fell by 78 bps at the last week auction. ($1 = 153.2500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Vyas Mohan)

 

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.<

Sri Lankan shares fall to 3-1/2-month closing low; banks drag

FIRST CAPITAL’S HEAD OF RESEARCH DIMANTHA MATHEW SPEAKS TO REUTERS

August 9, 2017

COLOMBO, Aug 9 (Reuters) – Sri Lankan shares fell for the ninth straight session on Wednesday, posting their lowest close in three-and-a-half months, with banks such as Hatton National Bank leading the fall.

The Colombo stock index fell 0.28 percent, or 18.10 points, to 6,506.03, its lowest close since April 25. It fell 1.5 percent last week in its third straight weekly drop.

“Turnover levels improved with the increased foreign participation, but the market came down with the continued selling pressure on selected counters,” said Dimantha Mathew, head of research at First Capital Holdings.

“But the good thing is that foreigners are returning to the market.”

Analysts said the market is coming down due to the negative sentiment after the earnings with the economic slowdown.

Foreign investors net bought shares worth 124.3 million rupees (about $811,358) on Wednesday, extending their year-to-date net inflow to 26.6 billion rupees.

Turnover stood at 747.5 million rupees, less than this year’s daily average of around 884.6 million rupees.

Shares of Hatton National Bank fell 1.3 percent, Chevron Lubricant Lanka Plc ended 5 percent weaker and Ceylon Cold Stores Plc dropped 1.2 percent.

Analysts, however, expect equities to gain due to a fall in the yields of government bonds.

Sri Lanka’s central bank held policy rates steady on Thursday, and said tightening measures taken in the past are helping cool inflation and credit growth.

Short-term treasury-bond yields fell between 10 basis points (bps) and 16 bps at a weekly auction on Wednesday, while the yields on a 59-month bond dropped by 99 bps and that on a 118-month bond fell by 78 bps at the last week auction. ($1 = 153.2000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

 

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.<

Sri Lankan shares fall to 3-1/2-month closing low, blue chips drag

FIRST CAPITAL’S HEAD OF RESEARCH DIMANTHA MATHEW SPEAKS TO REUTERS

August 8, 2017

COLOMBO, Aug 8 (Reuters) – Sri Lankan shares fell for an eighth straight session on Tuesday, posting their lowest close in nearly 3-1/2 months, with blue chips such as John Keells Holdings Plc leading the decline while selling by foreign investors also weighed on the market.

The Colombo stock index fell 0.66 percent, or 43.30 points, to 6,524.13, its lowest close since April 26. It fell 1.5 percent last week in its third straight weekly drop.

“The market continued to come down on blue chips in low turnover,” said Dimantha Mathew, head of research at First Capital Holdings.

“We find it mainly due to the negative sentiment after the earnings with the economic slowdown.”

Foreign investors, who have been net buyers of 26.5 billion rupees of equities so far this year, net sold shares worth 29.1 million rupees (about $189,886) on Tuesday.

Turnover stood at 350.4 million rupees, less than half of this year’s daily average of around 893.3 million rupees.

Shares of conglomerate John Keells dropped 2.8 percent, Nestle Lanka Plc dropped 1.6 percent, Caltex Lubricant Lanka Plc ended 3.6 percent weaker and Dialog Axiata Plc declined 0.9 percent.

Analysts, however, expect equities to gain due to a fall in the yields of government bonds.

Sri Lanka’s central bank held policy rates steady on Thursday, and said tightening measures taken in the past are helping cool inflation and credit growth. Short-term treasury-bond yields fell between 41 basis points (bps) and 55 bps at a weekly auction last week, while the yields on a 59-month bond dropped by 99 bps, while that on a 118-month bond fell by 78 bps.

Sri Lanka’s stock and foreign exchange markets were closed on Monday for a Buddhist religious holiday. ($1 = 153.2500 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

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.<

Lanka Ceramic announces restructuring

Source: Daily FT, Wednesday, 9 August 2017

Share Market Investment in Sri Lanka

Lanka Ceramic PLC has announced a restructuring of operating assets of the company to give maximum value to shareholders and allow for capital to be raised at a reasonable cost to finance existing as well as future operations and to reflect the real net worth of the company based on growth potential.

The board is of the view that the number of shares of the company is not in line with the capital needed by a company of its size and operation hence has recommended that the number of shares in issue be reduced by 80% to facilitate raising fresh capital at a price more reflective of the intrinsic value of its own operation.

The proposed restructuring of operating assets (excluding 62% stake in Lanka Walltiles Plc) will eventually lead to rationalisation of the shareholder structure in the group companies which also includes Royal Ceramics Plc.

The board has resolved that the company offer to repurchase 24 million issued voting ordinary shares (80%) out of 30 million in issue in the proportion of four shares out of every five held at Rs. 190 per share. Such considerations will be in the form of cash or offer to transfer 1.4148 ordinary shares of Lanka Walltiles Plc in respect of the entitlement of the shareholders as per the proportion proposed and in respect of the offer for repurchase of shares over and above the entitlement of additional shares of shareholders who do not accept the offer, the settlement of consideration to be by way of transfer of shares of Lanka Walltiles Plc (LWL) and not for cash.

The move is subject to shareholder approval for a Special Resolution at an EGM being received. This is because the transfer by the company by way of a consideration of 62% stake in LWL is a disposition of more than half by value of the assets of the company and is a transaction having the effect of substantially altering the nature of business carried out by the company – in this instance managing and holding investments in subsidiary companies, which is a major transaction.

If in the event that shareholders holding more than 5% shares request for a cash consideration instead of shares of LWL as consideration, Lanka Ceramic Directors have the discretion to not proceed with the repurchase of shares.

The resolution to repurchase is to be effective subject to there being no changes in the current regulations prior to the completion of the repurchase that may have an adverse impact on the expected value to be received by shareholders, thereby varying the value as a result of which the varied value may not be considered the ‘fair value’.

The proposed restructuring is also subject to the approval of the Securities and Exchange Commission for the transfer of shares of LWL from the company to the shareholders accepting the offer.

Currently, Royal Ceramics holds 24 million shares of Lanka Ceramics which results in RCL obtaining 27,846,293 shares of LWL in consideration of the share repurchase by Lanka Ceramics. This move will result in RCL holding 51% stake of LWL, making RCL the parent of LWL. RCL will hold 4.8 million shares in Lanka Ceramics post-restructure, thereby continuing to hold an 80.3% stake in the entity.

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.<

MARKET UPDATE ON ADA DERANA ENGLISH NEWS – 2017.08.06

Stock-Brokers-In-Sri-Lanka

First Capital’s Head of Research Dimantha Mathew with the market update – between 18.55 mins to 19.28 mins

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.