Businessman Dhammika Perera buys Beach Resorts for Rs330mn

(LBO) – Sri Lankan business tycoon Dhammika Perera has bought control of Beach Resorts limited for 330 million rupees, Amaya Leisure said.

The Board of Directors of Amaya Leisure announced to the Colombo Stock Exchange that it has taken a decision to divest its entire shareholding in The Beach Resorts Ltd, a subsidiary of the Company.

“Board of Directors has taken this decision to rationalize the investment portfolio of the company,” Amaya Leisure said.

As a result, the Company disposed 6,176,790 shares which constitute 84.30 percent of the equity stake of The Beach Resorts Ltd today.

The company has sold the stake for 330.11 million rupees to K.D. Dhammika Perera who is also a Director of Amaya Leisure and The Beach Resorts Ltd.

La Forteresse buys into Alila Hotels with Rs 364 mn investment

La Forteresse (Private) Limited, a fully owned subsidiary of The Fortress Resorts, made an initial investment of Rs.364 million in Alila Hotels and Resorts for a 66 roomed five star hotel at Thalaramba,Weligama to at an estimated cost of Rs.2.1 billion, which includes the cost of land for over Rs.345 million.

The hotel project is undertaken by Alila Hotels & Resorts and La Forteresse (Private) Limited now holds 99.99% of the issued shares of Alila Hotels & Resorts which will be subsequently diluted to 51%.

Citing the rationale for entering into this transaction, the company said that as any expansion of the existing hotel ‘The Fortress’ is limited, the board has decided to invest in a new hotel project to maximise future potential in the long run by optimising strengths within the company and harnessing the expected growth in the tourism sector. (IH)
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Sri Lanka’s Hayleys plans 55-storey twin towers at Deans Road

ECONOMYNEXT – Hayleys said it plans a property development project at its head office premises in the Sri Lankan capital Colombo consisting of twin 55-floor towers each with 3.8 million square feet of “A” Grade commercial space.

The proposed venture would be carried out by a newly incorporated company with 100% of initial equity investment made by Hayleys.

The towers will come at the Hayleys head office premises at No. 400, Deans Road, Colombo 10, a stock exchange filing said.

The implementation of the proposed venture would depend on it receiving infrastructure development incentives offered by the government in the recent past to similar development projects in the country, it said.

Sri Lanka’s Fortress Resorts to build Rs2.1bn 5-star beach hotel

ECONOMYNEXT – The Fortress Resorts, a hotel that’s part of the group of businesses controlled by Sri Lankan businessman Dhammika Perera, is to build a 66-room five-star beach resort on the south coast for Rs2.1 billion.

The Fortress Resorts said in a stock exchange filing that its fully owned subsidiary La Forteresse (Private) Ltd. invested Rs364 million in Alila Hotels & Resorts (Pvt) Ltd. to set up the hotel at Thalaramba, Weligama.

The hotel is to be built by Alila Hotels & Resorts (Pvt) Ltd. at a cost of Rs 2.1 billion which includes the cost of land of Rs345.8 million.

La Forteresse now owns 99.9% of Alila Hotels & Resorts (Pvt) Ltd. which will be subsequently diluted to 51%, the statement said.

The investment by La Forteresse in Alila Hotels is to finance the purchase of three acres of land at Weligama which Alila had bought for Rs345.8 million from LB Finance, a finance firm controlled by Perera.

Sri Lanka sells Rs55bn in bonds below secondary yields

ECONOMYNEXT - Sri Lanka sold 55.58 billion rupees of 4, 7 and 10-year bonds after calling offers for 57 billion rupees, at yields below the secondary market prices earlier in the day, auction data show.

The debt office, which is a unit of the Central Bank sold 18.58 billion rupees of 4-year bonds maturing on 01 March 2021 to yield an average of 11.94 percent.

The same 4-year bonds were quoted at 11.95/05 percent before the auction dealers said.

18.6 billion rupees of 7-year bonds maturing on 01 August 2024 were sold to yield an average of 11.98 percent.

The exact maturity was quoted around 12.20/40 percent before the auction.

18.4 billion rupees of 10-year bonds maturing on 01 August 2026 were sold to yield an average of 12.11 percent.

10-year bonds were quoted around 12.30/45 percent before the auction.

It is not clear who bid at rates below secondary market at the auction. Whether state-controlled (captive source) bid at lower yields or real investors bid low expecting yields to drop is not known. In January some sales proceeds of Hambantota Harbhour is expected. Revenues will also be up, with no salary hikes.

After the auction secondary yields did not drop, but dealers say due to late auction results, there was no active trading.

If secondary rates drop exiting foreign investors who could only sell a 7-year bonds at 98.62 rupees (12.20-pct) would be able to sell at 99.56 rupees (12.00 percent) tomorrow.

A foreign investors who sold a 2026 bond today at 100.22 rupees (12.30 percent) would be able to sell at 101.31 (12.10 percent) tomorrow, if rates fall. A similar profit would be found if the rupee appreciated by one rupee.

Sri Lanka's central bank printed money for 70 days or more through outright purchases of Treasuries, from November loosening policy, pushing longer yields also down rates down, (Sri Lanka loosens policy; signals longer term rates) giving larger profits to exiting foreign investors than if credit markets operated freely, critics say.

Over the last three years, money markets show excess liquidity which is usually the result of dollar inflows or a central bank profit transfer.

Colombo Stock Exchange Market Review – 27th Dec 2016

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Colombo Stock Exchange Trade Summary 27-Dec-2016

Colombo Bourse slipped back to negative territory on Tuesday in another weak trading session. All Share Index fell back to eight-month low of 6,202.83 with a loss of 13.73 index points or 0.2%. S&P SL 20 index fell 5.19 index points (-0.2%) to 3,477.02.

Out of the 171 counters traded, 52 declined and 41 gained while 78 remained unchanged. Ceylon Tobacco (LKR 800.20, -1.8%), John Keells Holdings (LKR 143.30, -0.9%) and Ceylinco Insurance (LKR 1,249.20, -6.5%) led the losers while Seylan Bank (LKR 92.90, +8.3%), LOLC (LKR 73.00, +1.4%) and People’s Leasing (LKR 17.90, +1.7%) managed close positively.

Market turnover stumbled to one-month low of LKR 111mn. Seylan Bank (LKR 28mn), John Keells Holdings (LKR 19mn) and Hayleys Fabric (LKR 18mn) made the largest contributions to the turnover. No crossings were witnessed today.

John Keells Holdings dominated the trading activity. Further, Lanka IOC, Seylan Bank voting and nonvoting were among heavily traded stocks.

Foreign investors were net sellers today with a net foreign outflow of LKR 10mn. Top net outflows were seen in John Keells Holdings (LKR 11mn), Seylan Bank (LKR 3mn) and Hayleys (LKR 1mn) while top net inflow was seen in Commercial Bank (LKR 3mn). Foreign participation accounted for 19% of the market activity.
Source: LSL

Sri Lankan shares hit more than 8-mth closing low; turnover slumps

Reuters: Sri Lankan shares closed at their weakest in more than eight months in typical year-end holiday-thinned trading on Tuesday, with turnover slumping to a near 33-month low as investors stayed away.

The Colombo stock index ended 0.22 percent lower at 6,202.83, its lowest close since April 6. It has shed around 2.1 percent in the 10 sessions through Tuesday.

Turnover stood near its lowest since March 17, 2014, at 111.2 million rupees ($745,308), around a seventh of this year's daily average of 735.4 million rupees.

"Most of the investors and brokers are on holiday. We may see little price adjustments in shares, but the trading volume will be very low," said Hussain Gani, deputy CEO at Softlogic Stockbrokers.

Foreign investors sold a net 10.2 million rupees worth shares on Tuesday, but they have been net buyers of 611.3 million rupees worth equities as of Tuesday this year.

Top conglomerate John Keells Holdings fell 1 percent, while large cap Ceylon Tobacco Company closed 1.8 percent lower, dragging down the overall index. 

($1 = 149.2000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Biju Dwarakanath)