Tag Archives: Stock brokers in Sri Lanka

Nisansala Kuruppumudali, Research Analyst, at First Capital on the bond and equity market performance – 11.07.2019

Treasury Bills and Bonds in Sri Lanka

Nisansala Kuruppumudali, Research Analyst, at First Capital on the bond and equity market performance – 11.07.2019

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 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.

Hiruni Perera from First Capital commenting on the bond and equity market performance -10.07.2019

Hiruni Perera, Senior Research Analyst at First Capital commenting on the bond and equity market performance – 10.07.2019

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 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 Lanka Economy to Expand 1.5% in 2Q19; Prior +3.5%

Stock Market Sri Lanka

(Bloomberg) — The Sri Lanka economy will expand 1.5% in 2Q, according to the latest results of a Bloomberg News survey of 11 economists conducted from July 2 to July 8.

* GDP 3Q19 +2.1% y/y vs prior +3.6%

* GDP 4Q19 +3% y/y vs prior +3.7%

* GDP 2019 +2.7% y/y vs prior +3.5%

* GDP 2020 +3.8% y/y vs prior +3.8%

* Dimantha Mathew, head of research at First Capital Holdings: “Production and SME business was at a complete standstill for nearly four weeks while sentiment was very weak for a further two weeks before we saw any recovery.”

* CPI 3Q19 +4.3% y/y vs prior +4.7%

* CPI 2019 +4.5% y/y vs prior +4.5%

Monetary Policy to be maintained allowing impact of previous rate cut to materialize

LANKA BUSINESS ONLINE | 08.07.2019

Investment Bank in Sri Lanka

Sri Lanka’s Monetary Board would continue the policy rates with no change, considering the fact that it is too early to assess the impact of the previous 50 bps rate cut, First Capital said in a research note.

“We believe that Monetary Board may first consider, CBSL’s ability to implement lending rate caps before further policy rate cuts being implemented,” the firm said.

According to First Capital, it may take a lengthier period for lending rates in the market to decline and stimulate growth as the high level of NPL in the system may delay the dip in lending rates.

However, in order to accelerate the reduction in lending rates, First Capital expects imposition of a cap on lending rates to enhance credit flows to the economy with the intention of boosting the economic and credit growth.

“However, considering the slowness of the economy and the contraction of credit, we would not rule out a further 25 bps rate cut towards 4Q 2019 if economic growth fails to accelerate.”

The Central Bank reduced the SLFR and SDFR by 50 bps previously as policy intervention was required to address the subpar economic growth which was further affected by the Easter Sunday attacks.

Sri Lanka maintained foreign reserve position at 6.7 billion dollars by the end of May which is noteworthy considering the major outflows in April.

Sri Lanka successfully raised 2 billion dollars by conducting an international sovereign bond offering tenors of 5 and 10 year.

“Following the issuance, we expect the foreign reserves to show significant improvement reaching above USD 8.0Bn in Jun 2019 while maintaining above USD 7.5Bn during Jul to Dec 2019,” the firm said.

Meanwhile, the cabinet approval was granted to raise up to 480 billion dollars for debt management, which provides leeway for the Central Bank to raise further 2.5 billion dollars to manage debt in 2020 which would be an election year.

“Sri Lanka’s next international sovereign repayment is only due in Oct 2020 amounting to USD 1.0Bn while 1Q and 2Q each constitute USD 0.4Bn of SLDBs maturing,”

“Raising funds well in advance for repayments is expected to significantly strengthen macro economic outlook for Sri Lanka and to reduce unnecessary volatility.”

During the month of June, USD:LKR remained stable to close at 176.42 on 28 Jun 2019 supported by foreign inflows, exporter conversions and contraction in imports.

However, REER continued to remain undervalued at 91.95 in May while the firm estimates it to be 92.35 in Jun.

The external environment is favoring lower yields as the weakening US economy led the Fed to rethink its interest rate normalization strategy resulting in Fed indicating a likely monetary easing in upcoming meetings.

The situation has weakened the dollar further supporting the stability of rupee.

Corporate earnings to recover from 4Q19 – FC

CEYLON TODAY | 08.07.2019

Investment Bank in Sri Lanka

Earnings of Sri Lanka’s listed firms are expected to improve from the fourth quarter of 2019 as the country is recovering faster than expected from the Easter Sunday attacks, the research arm of First Capital (FC), an investment house said.

“Despite the Easter Sunday attacks, Sri Lanka’s economic outlook has shown signs of resilience and ability to recover quickly, as economic activities were seen returning to normalcy while removal of travel advisories were faster than anticipated,” Research Head, Dimantha Matthew said.

“Though the unfortunate attacks and the subsequent events are likely to have directly or indirectly impacted all sectors affecting earnings of most companies, we believe that the impact has now been factored into the market, and an accelerated recovery is more likely than not,” he said.

“The heavy decline in interest rates is expected to lower finance costs, thereby improving earnings of most listed entities towards 4Q 2019.”

He said stocks are becoming more attractive as bond yields are moving downwards following Sri Lanka’s US$ 2 billion sovereign bond sale, which was oversubscribed and showed investor confidence.

Bond yields are likely to remain low due to current inflation, credit growth, liquidity and reserves, he said.
With the Central Bank ceiling on fixed deposit rates linked to gilt yields, investors are likely to turn towards the equity market, Matthew said.

“Lower fixed income returns may lead investors to hunt for alternative investment options with higher returns, of which equity investments are likely to be a more probable option considering the current attractive valuations,” he said.

The market-price-to-earnings ratio was an 8.7 multiple on Thursday.
Thereby we expect an improvement in demand for stocks leading to a possible re-rating of the market,» Matthew said. (Economynext)

Atchuthan Srirangan, Assistant Manager – Research, at First Capital on the Bond and equity Market performance – 07.07.2019

Treasury Bills and Bonds in Sri Lanka

Atchuthan Srirangan, Assistant Manager – Research, at First Capital on the bond and equity market performance – 07.07.2019

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 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 Lanka corporate earnings to recover from 4Q19

ECONOMY NEXT | 05.07.2019

Earnings of Sri Lanka’s listed firms are expected to improve from the fourth quarter of 2019 as the country recovers faster than expected from the Easter Sunday attacks, the research arm of First Capital, an investment house said.

“Despite the Easter Sunday attacks Sri Lanka’s economic outlook has shown signs of resilience and ability to recover quickly as economic activities were seen returning to normalcy while removal of travel advisories were faster than anticipated,” Research Head Dimantha Matthew said.

“Though the unfortunate attacks and the subsequent events are likely to have directly or indirectly impacted all sectors affecting earnings of most companies, we believe that the impact has now been factored into the market and an accelerated recovery is more likely than not,” he said.

“The heavy decline in interest rates is expected to lower finance costs, thereby improving earnings of most listed entities towards 4Q2019.”

He said stocks are becoming more attractive as bond yields are moving downwards following Sri Lanka’s 2 billion sovereign bond sale which was oversubscribed and showed investor confidence.

Bond yields are likely to remain low due to current inflation, credit growth, liquidity and reserves, he said.

With the central bank ceiling on fixed deposit rates linked to gilt yields, investors are likely to turn towards the equity market, Matthew said.

“Lower fixed income returns may lead investors to hunt for alternative investment options with higher returns, of which equity investments is likely to be a more probable option considering the current attractive valuations,” he said.

The market price to earnings ratio was a 8.7 multiple on Thursday.

“Thereby we expect an improvement in demand for stocks leading to a possible re-rating of the market,” Matthew said.

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 is an investment bank providing a full range of financial advisory and services. The Company’s research delivers a 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 expects improvement in corporate earnings towards 4Q19

DAILY MIRROR | 05.07.2019

The sharp decline in interest rates and resultant lower finance costs is likely to improve the earnings of listed corporates towards 4Q19 amid faster than expected recovery in the country’s economic outlook and lower rates, according to First Capital Research.

 
“The heavy decline in interest rates is expected to lower finance costs, thereby improving earnings of most listed entities towards 4Q19.

 
“In addition, lower Fixed Income returns may lead investors to hunt for alternative investment options with higher returns, of which equity investments are likely to be a more probable option considering the current attractive valuations.

 
“Thereby we expect an improvement in demand for stocks leading to a possible re-rating of the market,” First Capital Research said in a report yesterday.

 
The equity research house also said despite the Easter Sunday attacks, Sri Lanka’s economic outlook has shown signs of resilience and ability recover quickly as economic activities were seen returning to normalcy with the removal of travel advisories faster than anticipated.

 
“Though the unfortunate attacks and the subsequent events are likely to have impacted all sectors directly or indirectly affecting earnings of most companies, we believe that the impact has now been factored into the market and an accelerated recovery is more likely.”

 
Meanwhile, First Capital Research said the successful and early issuance of the US $ 2.0 billion sovereign bond by the Central Bank was a major confidence booster. The issue was oversubscribed three times.

 
“While most economic indicators such as inflation, credit growth and liquidity suggest decline in yields, strong reserve position supports sustainability of the lower yields.

 
“In line with expectations bank 1-year fixed deposit ceiling has fallen to 9.83 percent as of 1st July 2019,” First Capital Research said.

 

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 is an investment bank providing a full range of financial advisory and services. The Company’s research delivers a 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.

Dimantha Mathew, Head of Research, at First Capital on the bond and equity market performance – 04.07.2019

Treasury Bills and Bonds in Sri Lanka

Dimantha Mathew, Head of Research, at First Capital on the bond and equity market performance – 04.07.2019

First Capital is an investment bank providing a full range of financial advisory and services. The Company’s research delivers a 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 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.

Accelerated economic recovery likely

DAILY FT | 05.07.2019

  • Says improving macro stability and lower yields may strengthen equity returns
  • Improvement in demand for stocks can lead to possible re-rating of the market

Share Market Investment in Sri Lanka

 

First Capital Research yesterday said accelerated economic recovery is likely for Sri Lanka, as the months after the Easter Sunday attacks had shown a faster return to normalcy, quicker removal of travel advisories, and unexpected signs of resilience.

Releasing its latest update, First Capital Research said despite the Easter Sunday attacks, Sri Lanka’s economic outlook has shown signs of resilience and ability to recover quickly, as economic activities were seen returning to normalcy while removal of travel advisories were faster than anticipated.

“Though the unfortunate attacks and the subsequent events are likely to have directly or indirectly impacted all sectors, affecting earnings of most companies, we believe that the impact has now been factored into the market and an accelerated recovery is more likely than not.”

The successful and early issuance of the $2 billion Sovereign Bond by the Central Bank was also a major confidence booster, and the heavy investor interest, which was reflected by the three times oversubscription, was seen as encouraging by First Capital Research.

With most economic indicators such as inflation, credit growth and liquidity suggests decline in yields, strong reserve position supports sustainability of the lower yields. In line with expectations Bank 1-Yr FD ceiling has fallen to 9.83% as of 1 Jul 2019.

“The heavy decline in interest rates is expected to lower finance costs, thereby improving earnings of most listed entities towards 4Q2019. In addition, lower Fixed Income returns may lead investors to hunt for alternative investment options with higher returns, of which equity investments is likely to be a more probable option considering the current attractive valuations. Thereby we expect an improvement in demand for stocks leading to a possible re-rating of the market.”

Following the Easter Sunday attacks, First Capital Research expected a major negative hit to the consumer sector which was on a gradual recovery path. The recovery was confirmed with GDP for 1Q2019 registering at 3.7% while it was also reflected by indices released subsequently. Consequent to the incident economic activity came to a near standstill which impacted day to day affairs of most businesses and severely impacting the SMEs.

“In line with our expectations, the Nielsen – Consumer Confidence Index slumped to 37 and

36 points in May and Jun 2019, new lows since inception of the index,” it added.

It also said that with the rights issue being fully subscribed, Sampath Bank is correctly cash heavy with the ability to maintain lending growth well above the industry while capturing market share. “We are bullish on SAMP and recommend investors to invest 25% of the balance cash allocation into SAMP increasing equity portion of the portfolio to 69%,” First Capital Research added.

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 is an investment bank providing a full range of financial advisory and services. The Company’s research delivers a 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.