Sri Lanka's 01-yr Treasury yield down to 8.97-pct

ECONOMYNEXT - Sri Lanka's Treasury Bill yields eased further at an auction Wednesday with the 12-month bill yield down two percentage points to 8.97 percent, data from the state debt office showed.

The debt office, a unit of the central bank, accepted 07 billion rupees of 12-month bills, the same amount offered, having received bids worth 21 billion rupees.

The 3-month bill yield fell 03 basis points to 8.00 percent, with 4.0 billion rupees of bills, sold, the same amount offered.

Six-month bills were not offered.

Sri Lanka’s Cargills says supermarket, bank synergies yielding results

ECONOMYNEXT – Sri Lanka’s Cargills group has said its strategy of making its supermarket and banking businesses work together is yielding results with customer transactions growing between the two.

The group added 38 Cargills Food City supermarkets to its network last year, increasing its store count to 353 outlets and strengthening its position as the largest supermarket chain in the country.

Cargills Bank, started in 2014 has expanded its branch network to 17 but also has got regulatory approval to operate banking counters at all its Food City supermarkets islandwide, helping it keep costs low.

“Cargills Bank reported a commendable performance during the year, with robust growth in both lending and deposit portfolios,” group chairman Louis Page told shareholders in the latest annual report.

During the year, the bank launched a number of consumer products including both a debit and credit card.

“Synergies with Cargills Food City are now showing tangible results with transactions growth and encouraging consumer response to the added convenience of the service,” Page said.

The report said that in line with the focus of the group to use the synergies within the Cargills Group, transactions by Cargills Bank customers within ‘Cargills Food City’ reached Rs.4 billion in value in 2017.

Net finance costs of the sector rose 124% to Rs.283 million in 2017 amidst heavy investment in expansion of the ‘Cargills Food City‘ supermarket chain, the report said.

Cargills Bank saw total asset growth of 55% to Rs.32.5 billion in 2017 and deposit growth doubled to Rs.18.8 billion.

PVC pipe maker to focus on projects after Sri Lanka retail market losses

ECONOMYNEXT - Sierra Industries (Pvt) Ltd, a unit of publicly traded Sierra Cables Plc, which makes water pipes, says it is focusing on larger projects, after making losses in the retail market.

"As a strategic move, the company is now focusing on the institutional and project market instead of the competitive retail market," shareholders were told in the annual report.

"The company is in the process of the initialising the preliminary engagement work for the supply of PVC pipes and fittings to upcoming major projects."

Sierra Industries which manufactures uPVC (unplasticized Poly Vinyl Chloride) pipes, had won a 5.5 million dollar order to supply a foreign contractor in the Attanagalla Water Supply Project.

"While production has commenced, the delivery will take place only during the next financial year," Managing Director Shamindra Panditha told shareholders.

"The directors are of the view that the company would be able to generate sufficient revenue in the ensuing financial years, where by accumulated losses could be reduced gradually,” the annual report said, referring to the Attanagalla project.

Sierra Industries accounts said it is facing serious loss of capital and the auditors KPMG had also raised a going concern a with assets falling below liabilities.

Sierra Industries had accumulated losses of 276.2 million rupees up to end-March 2018. The firm started production in the 2013/2014 financial year.

As part of a restructuring process, a 119.6 million rupees owed to the parent had been converted to equity, while some payables had been converted to a loan term loan.

Sri Lankan shares fall to 2-week low on foreign selling

Reuters: Sri Lankan shares fell for a third straight session on Wednesday and marked a two-week closing low as foreign investors sold blue-chips after a research report said the country was facing risk of an exchange rate crisis.

Analysts said investors were worried after Japanese bank Nomura Holdings ranked Sri Lanka among seven emerging market economies that were at risk of an exchange rate crisis.

However, the Central Bank in a statement said that Nomura Holdings has made a serious computational error with regard to Sri Lanka’s external vulnerability and its short-term external debt is nowhere near the $160 billion figure that Nomura analysts quoted.

Nomura later corrected the figure to $7.5 billion, but said its analysts have used the same figure to calculate the country’s Damocles score for the analysis and thus it is unchanged.

The Colombo stock index ended 0.59 percent weaker at 6,059.00, its lowest close since Aug. 29. It had risen 0.6 percent last week in its third straight weekly gain.

“Investors were worried over the Nomura ranking, but they corrected external debt figure and accepted it was wrong. We expect people to build confidence back,” said Hussain Gani, deputy CEO at Softlogic Stockbrokers.

Analysts also said the increase in fuel prices also weighed on the market.

Sri Lankan fuel retailers raised gasoline and diesel prices for a third time in four months on Tuesday due to higher global oil prices and a weaker rupee, a finance ministry official said.

Turnover stood at 967.8 million rupees ($5.96 million), more than this year’s daily average of 793.9 million rupees.

Meanwhile, investors are also awaiting cues from the national budget which the government is set to unveil in November.

Shares of Ceylon Tobacco Company Plc fell 1.8 percent, while Distilleries Company of Sri Lanka ended 2.2 percent weaker. Conglomerate John Keells Holdings Plc closed 0.8 percent down and Sampath Bank Plc lost 1.8 percent. 

($1 = 162.3500 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Vyas Mohan)

Sri Lankan shares end flat in lacklustre trade

Reuters: Sri Lankan shares closed flat on Tuesday, near a more than one-week closing low, with beverage and manufacturing shares witnessing mild selling, a day after fuel prices were hiked for the third time in four months.

Sri Lankan fuel retailers raised gasoline and diesel prices for a third time in four months on Tuesday due to higher global oil prices and a weaker rupee, a finance ministry official said.

Turnover was 337.3 million rupees ($2.08 million), less than half of this year’s daily average of 792.8 million rupees.

The Colombo stock index ended 0.02 percent weaker at 6,095.23, its lowest close since Sept. 3. It had risen 0.6 percent last week in its third straight weekly gain.

“The market came down marginally today, but the good sign is we see some net foreign buying,” said Hussain Gani, deputy CEO at Softlogic Stockbrokers.

Analysts said investors also waited for cues from the national budget which the government is set to unveil in November.

Foreign investors bought a net 74.7 million rupees of shares on Tuesday, but they have been net sellers of 4.4 billion rupees worth of shares so far this year.

Shares of conglomerate John Keells Holdings Plc fell 0.2 percent while Lanka ORIX leasing Plc lost 2.2 percent.

($1 = 162.2500 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Vyas Mohan)

Sri Lankan shares slip to 1-week closing low on foreign selling

Reuters: Sri Lankan shares fell to one-week closing low on Monday as foreign investors sold blue chips such as conglomerate John Keells Holdings Plc.

The Colombo stock index ended 0.35 percent weaker at 6,096.54, its lowest close since Sept. 3. It rose 0.6 percent last week in its third straight weekly gain.

Turnover was 615.9 million rupees ($3.79 million), less than this year’s daily average of 795.6 million rupees.

“Today also, foreign selling was there and it impacted the market. Foreigners are exiting with the dollar strengthening,” said Atchuthan Srirangan, assistant manager - research, First Capital Holdings Plc.

“Local investors are worried over continued foreign selling on the back of dollar strengthening globally and they are on the sidelines.”

Analysts said investors also waited for cues from the national budget which the government is set to unveil in November.

Foreign investors sold a net 112.1 million rupees of shares on Monday, extending the year-to-date net foreign outflow to 4.4 billion rupees worth of shares.

Shares of Distillers Company of Sri Lanka Plc fell 3.1 percent, while conglomerate John Keells Holdings ended 0.7 percent down and AIA Insurance Lanka Plc lost 4.4 percent. 

($1 = 162.3000 Sri Lankan rupees) 

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

Sri Lankan shares climb on foreign buying, post 3rd week of gains

Reuters: Sri Lankan shares ended slightly firmer on Friday, boosted by foreign buying, and posted their third straight week of gains.

The Colombo stock index ended 0.09 percent firmer at 6,117.89. The bourse rose 0.6 percent during the week.

The day’s turnover was 274 million rupees ($1.69 million), about a third of this year’s daily average of 796.7 million rupees.

“Investors are awaiting the national budget,” said Atchuthan Srirangan, assistant manager - research, First Capital Holdings Plc.

The government is set to unveil its 2019 national budget in November.

Foreign investors bought a net 29.4 million rupees of shares on Friday, recording the first session of net foreign buying in nine. But they have been net sellers of 4.3 billion rupees worth of shares so far this year.

Shares of AIA Insurance Lanka Plc rose 4.8 percent, Sri Lanka Telecom Plc climbed 3.2 percent and Asiri Hospitals Plc closed 3.9 percent higher.

($1 = 161.9000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Amrutha Gayathri)