Sri Lankan stocks close at highest in 39 months

(Reuters) - Sri Lankan stocks closed at their highest in nearly 39 months on Tuesday, led by diversified and banking shares, as low interest rates and continued buying by foreign investors into risky assets boosted investor sentiment.

The main stock index rose 0.51 percent, or 36.03 points, to close at 7,123.44, its highest closing since June 13, 2011.

"There was lot of foreign interest seen in Keells (John Keells Holdings Plc) and it seems to be continuing," said Dimantha Mathew, Manager (Research) at First Capital Equities (pvt) Ltd.

"We are seeing a slow and steady movement in the market; the run has been steady and backed by earnings."

The index has gained nearly 20.48 percent so far this year.

The bourse has been in an overbought region since July. The Relative Strength Index, a momentum indicator tracked by chartists, was at 83.088 on Tuesday, Thomson Reuters data showed.

Stocks are deemed "overbought" above the 70-mark, signalling a reversal in the near term.

Market heavyweight John Keells Holdings Plc led the gains in the overall index with a rise of 2.44 percent at 256.10 rupees, while Commercial Bank of Ceylon, the country's biggest listed lender by market capitalisation, rose 1.74 percent to 158 rupees.

Exchange turnover was 1.92 billion rupees ($14.75 million), higher than this year's daily average of 1.2 billion rupees.

Foreign investors were net buyers of 309.9 million rupees worth of shares, extending the year-to-date net foreign inflows to 9.46 billion rupees.

Sri Lanka's stock and foreign exchange markets were closed on Monday for a Buddhist holiday. 

($1 = 130.1800 Sri Lankan rupee) 

(Reporting by Ranga Sirilal; Editing by Biju Dwarakanath)

Sri Lanka stocks close up 0.5-pct

Sep 09, 2014 (LBO) - Sri Lanka's stocks close 0.51 percent higher with index heavy John Keells Holdings gaining amid strong foreign buying, brokers said.

The Colombo benchmark All Share Price Index closed 36.03 points higher at 7,123.44, up 0.51 percent. The S&P SL20 closed 36.68 points higher at 3,969.49, up 0.93 percent.

Turnover was 1.92 billion rupees, up from 1.25 billion rupees last Friday with 137 stocks closed positive against 76 negative.

People’s Leasing and Finance closed 60 cents higher at 18.80 rupees with an off-market transaction of 453.57 million rupees changing hands at 18.50 rupees per share contributing 24 percent of the turnover.

The aggregate value of all off-the-floor deals represented 31 percent of the turnover.

Bansei Royal Resorts Hikkaduwa closed 2.50 rupees higher at 12.70 rupees and Lanka IOC closed 1.10 rupees higher at 45.40 rupees, attracting most number of trades during the day.

Foreign investors bought 466.17 million rupees worth shares while selling 156.31 million rupees worth shares.

John Keells Holdings closed 6.10 rupees higher at 256.10 rupees, contributing most to the index gain.

JKH’s W0022 warrants closed 6.10 rupees higher at 74.50 rupees and its W0023 warrants closed 4.60 rupees higher at 80.40 rupees.

Entrust infuses Rs 2.5 b into Standard Credit Finance

The Standard Credit Finance Limited (TSCFL), a Licensed Finance Company of the Ceylinco Group has been successfully resuscitated by the management of Entrust group.

The Standard Credit Finance Limited formerly known as Ceylinco Investments and Realty Ltd was one of the distressed regulated Finance Companies under the management of the Ceylinco Group.

During the crisis period as decided by the Central Bank of Sri Lanka (CBSL) the Company's management was initially handed over to Lankaputhra Development Bank, who was appointed as the Managing Agent by the Monetary Board in March 2009 to manage the affairs of the company.

Subsequently Merchant Bank of Sri Lanka took over as the Managing Agent in September 2009 and in 2010, the Company under went another name change as it was re-named as Standard Credit Lanka Limited.

Entrust group which is also an aggrieved creditor had initially advanced Rs 384 million to TSCFL prior to the crisis period and in the process of recovering its dues the Monetary Board of the Central Bank of Sri Lanka upon accepting the submitted restructuring plan invited Entrust Limited to sign a Memorandum of Understanding with TSCFL. Since April 1, 2011 this collaboration has enabled the two companies to formulate and implement the proposed plan in order to safeguard the interest of the distressed depositors.

A spokesperson for the group said that based on the ongoing financial sector consolidation program and to comply with the Directions issued by the Monetary Board, Entrust group was required to infuse additional capital amounting to Rs 2.5 bn to TSCFL and this process was successfully concluded.
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Richard Pieris to buy 51% of Chilaw Finance

Richard Pieris Group is to buy 51% control of Chilaw Finance PLC, via subsidiary Richard Pieris Arpico Finance Ltd., as part of the Central Bank-initiated financial sector consolidation.

RPC said the subsidiary has entered into a Memorandum of Understanding with major shareholders of Chilaw Finance. The firm is conducting a legal and financial due diligence as per the MoU and the purchase will be finalised after the due diligence.

On 13 August, RPC subsidiary bought 12.5% stake in Chillaw Finance for over Rs. 100 million via the stock market. Price paid was around Rs. 25.50 per share. Its Net Asset Per share is Rs. 15.43.

Chilaw Finance is a relatively small finance company with assets worth Rs. 1.3 billion and liabilities of Rs. 796 million. Its directors including J.A.D.N. Jayasuriya and related parties collectively own a 27.6% stake in the company.

The other largest shareholder is R.W. Kulatunga – owning 11%. Chilaw Finance has 61% in public share holding.

Richard Pieris Arpico Finance recently reached the milestone of Rs. 1 billion in deposits and said it is planning at least five branches within the next four to five months with the first one in Matara.
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