Budget not full of election goodies

More focus on knowledge economy concept

Shirajiv Sirimane shirjivs@gmail.com

The 2015 budget to be presented this month will not be a budget full of election goodies but it will be a development oriented one Secretary to the Treasury Dr. P.B. Jayasundara said yesterday.

Speaking at the Capital Market Conference 2014 held yesterday he said the forthcoming budget presented on October 24 will focus on promoting the knowledge economy concept, for which the country has gained momentum.

He also said the country has been maintaining steady economic growth at 7.8%. High economic growth has been maintained in the recent years and if the economic growth rate lowers to around 6% it would be considered very low.

CSE Chairman Vajira Kulatilleke, Central Bank Governor Ajith Nivard Cabraal, Secretary to the Treasury, Dr. P. B. Jayasundera and SEC Chairman Dr. Nalaka Godahewa at the event.

He also said the recent visit of Japanese and Chinese Prime Ministers have helped Sri Lanka to secure commitments of in excess of US$ 2 billion of investments to promote tourism and aviation as well as trade and tourism.

The net value of Unit Trusts has shifted from less than Rs. 6 billion to over Rs. 75 billion and the value of listed debt has increased from Rs. 12.5 billion in 2009 to Rs. 68.7 billion by end 2013. The market capitalization is now over Rs. 3 Trillion and appreciation of 300 percent. “So, all sounds good for the industry participants and investors as the market has grown well on a diversified basis and underscores the country's economic prospects,” he said.

The topic of Asset Markets have attracted global attention in recent times with assets bubbles in well established markets that have compelled everyone to take note of underlying risk management challenges. Understanding this is difficult when the ‘going is good’ since the tendency is to forget everything and feel good, but when the ‘going is bad’, everything becomes amazingly hard. We must not permit good times of today, to be the sad thoughts of tomorrow.
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Foreign investors seek Clarity

Visiting foreign delegates yesterday raised concerns regarding key elements of the local capital market, indicating exercising of caution before investing in the country.

During an interactive panel discussion at the Capital Market Conference 2014, potential investors sought clarification from the regulators themselves on areas such as availability of liquidity, transaction costs and probable impacts on Sri Lanka due to interest rates increase in the US.

While investors pointed out that challenges observed by them in the local capital market are the “sheer lack of liquidity” and the high transaction cost, Colombo Stock Exchange Chairman (CSE) Vajira Kulatilaka assured that much was being done by the regulators to increase liquidity levels. However, he dismissed the notion that Sri Lanka has high transaction costs.

“On the transaction cost, it is debatable. There are no taxes on capital gain and in that case the transaction cost is lower compared to any other countries. The trend is that it has come down. We can’t just open up as there will be other repercussions on the market,” he said at the panel discussion, which also featured Securities and Exchange Commission (SEC) Chairman Dr. Nalaka Godahewa and Central Bank Deputy Governor Ananda Silva.

Regarding the possible impacts on the local stock market due to an increase in interest rates in the US, Deputy Governor Silva admitted that while Sri Lanka could be hit, the situation would be manageable.

“Our country is open, so there will be some impact. Since we have built certain buffers and have strengthened our reserves, we should be able to manage it. However, if there is a sudden increase, some investors might pull out; but then, if you look at the growth of the country and its prospects, there are opportunities to invest in Sri Lanka,” expressed Silva.
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Sri Lankan stocks end weaker amid profit taking

(Reuters) - Sri Lankan stocks fell marginally on Thursday, moving further away from their near three-and-a-half-year high hit last week, amid profit-taking in blue-chips such as Ceylon Tobacco Company Plc and John Keells Holdings Plc.

The main stock index ended 0.13 percent, or 9.93 points, weaker at 7,386.08. It had hit its highest close since May 31, 2011 on Friday.

"The retail interest seems to be low now and there was a bit of profit taking in John Keells and CTC, which brought the market down," said Dimantha Mathew, manager, research at First Capital Equities (pvt) Ltd.

Analysts said investors are awaiting the September-quarter earnings and the 2015 budget scheduled on Oct. 24 for further cues.

Foreign investors were net sellers for the second straight session on Thursday. They sold a net 8.4 million rupees worth of shares on Thursday, but they have been net buyers of 9.68 billion rupees so far this year, exchange data showed.

Ceylon Tobacco, which led losses, ended 5.16 percent weaker at 1,150.10 rupees, while John Keells fell 0.43 percent to 252 rupees.

The day's turnover was 1.46 billion rupees ($11.20 million), more than this year's daily average of over 1.35 billion rupees.

Stock and foreign exchange markets were closed on Wednesday for a Buddhist religious holiday. 

($1 = 130.3500 Sri Lankan rupee) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

Sri Lanka’s 2015 budget is not targeted at elections: Treasury Secretary

Oct 09, 2014 (LBO) – Sri Lanka’s budget for the year 2015 is more towards development rather than catering to mere election purposes, Treasury Secretary P B Jayasundera said.

“Although there was a reference made in the last weekend media that the 2015 budget will be a bag full of elections goodies, I can assure you that it will be a development oriented budget that is in line with the direction so set.”, Jayasundera said.

Addressing the capital market conference 2014 on Thursday, he further stated that the budget will have a significant emphasis on the knowledge economy concept with which the country has gained momentum.

The 2015 budget will be presented to the parliament on 24, October 2014.

Sri Lanka stocks close down 0.13-pct

Oct 09, 2014 (LBO) - Sri Lanka's stocks closed lower with tobacco and diversified stocks losing ground amid thin foreign participation, brokers said.

The Colombo benchmark All Share Price Index closed 9.93 points lower at 7,386.08, down 0.13 percent. The S&P SL20 closed 0.71 points higher at 4,151.35, up 0.02 percent.

Turnover was 1.46 billion rupees, down from 1.74 billion rupees last Tuesday with 82 stocks closed positive against 124 negative.

Hemas Holdings closed flat at 61.50 rupees with an off-market transaction of 107.62 million rupees changing hands at 61.50 rupees per share contributing 7 percent of the turnover.

The aggregate value of all off-the-floor deals represented 20 percent of the daily turnover.

Index heavy John Keells Holdings had market transactions totaling 264.58 million rupees contributing 18 percent of the turnover.

Access Engineering closed 1.00 rupee higher at 30.70 rupees, attracting most number of trades during the day.

Foreign investors bought 330.66 million rupees worth shares while selling 339.03 million rupees worth shares.

Ceylon Tobacco Company closed 1.50 rupees higher at 1,160.00 rupees and John Keells Holdings closed 6.70 rupees lower at 253.10 rupees, contributing most to the index drop.

Nestle Lanka closed 17.00 rupees lower at 2,112.50 rupees.

Big share deals by several company directors

By J. Kurukulasuriya

Ceylon Finance Today: There have been several significant dealings in the shares of their companies by the directors of several companies in the preceding days. Rule 7.8 of the listing rules of the Colombo Stock Exchange make it mandatory for the directors of listed companies to disclose such trades.

Richard Pieris and Co PLC director, Sena Yaddehige bought 25,615,215 shares at Rs 3.08 each on 30 September, in terms of an employee stock option plan — total investment Rs 78.8 million.

W. D. N. H. Perera Chairman of Pan Asia Bank, bought 657,892 shares on or around 2 October, at a price of between Rs 23.20 and 24.50 each, through Don Wilbert Capital Ltd., a company in which he has an interest – the total investment thus being over Rs 15 million.

Sierra Cables Managing Director D. S. Panditha bought over 278,000 shares at Rs 2.30 each on 2 October.

Chandana L. De Silva ,director of Dunamis Capital PLC bought shares worth Rs 2,809,000, on or around 3 October.

The directors of Lighthouse Hotels PLC, part of the Jetwing Hotel Group, N. J. H. M. Coorey who is an executive director and M. T. M. S Coorey a non executive director have been steadily buying up small quantities of shares in recent months.

On 1 October they bought another 500 shares at a price of Rs 60. N.T.M.S. Cooray had 789,000 shares (1.25%) of the share capital and N.J.H.M. Cooray held 748,000 shares (1.63%), as at 30 June 2014 and is among the 20 major shareholders. Jetwing Hotels Management Services (Pvt) Ltd., and Mercantile Investments and Finance PLC are the two top shareholders of Lighthouse Hotel and together own over 54% of the ordinary voting shares.

On the sales side, S. Rajaratnam director of Beruwala Resorts PLC., sold one million shares at Rs 2.20 on 2 October and 1,100 shares and 2,200 shares just previous to that.
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Bartleet Finance's PAT up by 16.5%

Bartleet Finance recorded a post-tax profit increase by 16.5 percent during the financial year 2013/2014 in comparison to the previous year's profit of Rs.49.2 million to Rs. 57 million.

The securitization loan interest amortization adjustment into interest and similar expenses in the comparative year resulted in a restated profit of Rs.7.5 million. The previous year's re-stated income statement is referred to in compliance with accounting standards and to indicate the impact of the financial result of the previous year.

Although, the above adjustment was made, interest and similar expenses have ascended with a growth of 7.7 percent, resulting in a net interest income increase by 14.6 percent from Rs. 372 million to Rs. 426 million. Finally, Bartleet Finance enjoys a Rs. 57 million profit for the period showing a minute growing trend.
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