Carsons sell 500,000 Lion between Rs. 540 & Rs. 550

Carson Cumberbatch PLC, the controlling shareholder of Lion Brewery Ceylon PLC, last week sold off 500,000 shares of Lion at prices between Rs. 540 and Rs. 550, the Colombo Stock Exchange was notified in terms of its listing rules.

Carsons sources indicated that the parent held strategic stakes in its various subsidiaries with shares outside the strategic limit held in its trading portfolio.

"Such shares may be bought and sold within the fund manager’s discretion when the price is considered right," they said. "That in no way affects the strategic stakes."

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Shares at 8-month closing low on political & policy uncertainty - US Fed’s third rate increase affects foreigners

Equities continued to lose steam last week, falling ~23 points week-on-week to hit an eight-month low of 6,352.1 points as concerns over domestic political and policy uncertainty dominated sentiment and the US Fed raised interest rates for the third time this year, Acuity Stockbrokers said in their Share Market Weekly.

Since the first reading of Budget 2018 in early November, the broad-share price Index has fallen ~215 points (-3.3%) with consecutive losses in the six weeks since the budget, the report noted. Average daily turnover levels also fell 24% week-on-week as low market participation, particularly by institutional and high net worth investors dragged the average daily turnover for the week down to Rs.0.71Bn (cf. Rs.0.93Bn last week), it said.

"Crossings for the week accounted for just 36% of total market turnover, lower than the previous week’s crossings of 46% and reflecting the lower participation levels by high net worth and Institutional players. Crossings remained largely centered around mid-cap counters such as Teejay Lanka (28% of total crossings), Amana Bank (15% of total crossings) and LOLC (12% of crossings) while larger-cap blue chips such as JKH and COMB played a less dominant role as they cumulatively accounted for just 10% of total crossings," Acuity reported.

"Despite the lower daily average turnover levels, the year-to-date average remained at Rs. 0.94Bn, higher than the 2016 average of Rs.0.73Bn and reflecting relatively stronger equity market performance from earlier in the year."

Foreign investors however retreated to a net selling position last week, recording net sales of Rs. 0.07Bn as the US Fed raised rates for the third time this year in a widely anticipated move. The move along with the expectation of three hikes in 2018 represents the continuation of the US Fed’s monetary policy normalization which could in turn impact the performance of Emerging and Frontier market equities, Acuity said.

Markets in the week ahead are likely to remain dull ahead of the Christmas holidays, the brokerage anticipated.
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IPOs and listed debenture issues take off despite CSE depression

Despite the Colombo Stock Exchange plunging to an eight month closing low on Friday, two Initial Public Offerings (IPOs) by LVL Energy Fund Ltd. (LEF) and Jetwing Symphony Ltd. closed over-subscribed on their opening day while a listed debenture issue by the Sampath Bank was similarly over-subscribed.

"This is a positive signal in the context of the falling market," a stock analyst said. "Both LEF and Jetwing Symphony will be listed on the CSE when the share allotments are completed in the next few days."

LEF sought Rs. 1.2 billion equity funds by the issue of 120 million new shares at 10-rupees each while Jetwing Symphony raised Rs. 753 million through a ‘book building’ process through which bids for the shares were invited at Rs. 15, Rs. 16, Rs. 17 and Rs. 18.

With the majority of the bids at the 15-rupee price, this was determined as the strike price and investors bidding higher would have the difference between Rs. 15 and their bid price refunded.

Well informed sources said that the application for Rs. 600 million of shares from the IPO has made by the Amaleans of MAS assuring the success of the IPO.

Jetwing Symphony owns five operational hotels with part of the IPO Funds earmarked for the boutique Jetwing Kandy Gallery now on the drawing boards.

The Sampath listed debenture issue raised six billion rupees with an offer of rupees four billion initially with an option for a further two billion in the event of an oversubscription.

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Dialog, Richard Pieris in S&P Sri Lanka 20 Index

ECONOMYNEXT – The Colombo Stock Exchange (CSE) has included Dialog Axiata and Richard Pieris and Company in the S&P Sri Lanka 20 index, which tracks the top 20 largest and most liquid stocks, in its latest revision.

They replace Hayleys and Melstacorp in the semiannual rebalancing of the index, the CSE said in a statement.

The S&P SL 20 index includes the 20 largest companies by total market capitalization listed on the CSE that meet minimum size, liquidity and financial viability thresholds.

The constituents are weighted by float-adjusted market capitalization, subject to a single stock cap of 15%, which is employed to reduce single stock concentration.

The CSE said the S&P SL 20 index has been designed in accordance with international practices and standards.

Effective from 18 December 2017 the stocks in the S&P Sri Lanka 20 in alphabetical order are as follows.

Access Engineering PLC AEL.N0000
Aitken Spence PLC SPEN.N0000
Ceylon Cold Stores PLC CCS.N0000
Ceylon Tobacco Company PLC CTC.N0000
Chevron Lubricants Lanka PLC LLUB.N0000
Commercial Bank of Ceylon PLC COMB.N0000
Commercial Bank of Ceylon PLC Non-Voting COMB.X0000
DFCC Bank PLC DFCC.N0000
Dialog Axiata PLC DIAL.N0000
Hatton National Bank PLC HNB.N0000
Hatton National Bank PLC Non-Voting HNB.X0000
Hemas Holdings PLC HHL.N0000
John Keells Holdings PLC JKH.N0000
Lanka Orix Leasing Company PLC LOLC.N0000
National Development Bank PLC NDB.N0000
Nestle Lanka PLC NEST.N0000
People's Leasing & Finance PLC PLC.N0000
Richard Pieris & Company PLC RICH.N0000
Sampath Bank PLC SAMP.N0000
Seylan Bank PLC SEYB.N0000
Seylan Bank PLC Non-Voting SEYB.X0000
Teejay Lanka PLC TJL.N0000
Tokyo Cement Company (Lanka) PLC TKYO.N0000
Tokyo Cement Company (Lanka) PLC Non-Voting TKYO.X0000

Sri Lankan stocks slip to 8-month closing low

Reuters: Sri Lankan shares slipped to their lowest close in eight months on Friday as investors offloaded telecom and plantation stocks.

The Colombo Stock Index ended 0.08 percent weaker at 6,352.10, its lowest close since April 17. It dropped 0.4 percent this week, in its sixth consecutive weekly decline.

“The downtrend is continuing with the selling in blue chips,” said Dimantha Mathew, head of research at First Capital Holdings, adding that was a bit of a worrying sign for the market.

Plantation stocks came under pressure after the Russian agricultural safety watchdog said on Thursday that the country will place temporary restrictions on imports of all agricultural products from Sri Lanka, including tea, from Dec. 18.

“The Russian restrictions on tea could pose a threat to long-term tea prices and it could impact the earnings of plantation companies,” said Mathew.

Turnover was 345.4 million rupees ($2.25 million), the lowest since Dec.9, and well below this year’s daily average of 938.9 million rupees.

Foreign investors were net buyers of 180.1 million rupees worth of shares on Friday, extending the year-to-date net foreign inflow to 18.3 billion rupees worth of shares.

Shares of Sri Lanka Telecom Plc fell 1.5 percent, Hemas Holdings Plc ended 0.9 percent weaker and Asian Hotels and Properties Plc ended down 2 percent. 

($1 = 153.2000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal; Editing by Subhranshu Sahu)

Jetwing Symphony IPO oversubscribed

Jetwing Symphony Ltd’s Initial Public Offering worth Rs. 750 million has been oversubscribed, prompting the closure of its official opening day.

Registrars to the issue SSP Corporate Services said there were applications for over 50.2 million shares at Rs. 15 each by 4.30 p.m. yesterday and the IPO was closed following oversubscription. Capital Alliance Partners was the Manager to the issue.

Jetwing Symphony is the investment arm of the Jetwing leisure and travel group. The IPO of 10% stake was based on a formal book-building process with a price band ranging from Rs. 15-18.

The IPO funds will be utilised to complete Jetwing Symphony’s projects in the pipeline and settle debt payments. As per the valuation report, intrinsic value per share of JSL ranges from Rs. 13.21-17.51 based on Sum-Of-The-Part (SOTP) valuation.
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Investors snap up biggest IPO in 4 years by LVL Energy Fund

Investors have snapped up the biggest Initial Public Offering in four years by LVL Energy Fund Ltd. (LEF), with the Rs. 1.2 billion issue oversubscribed and closed on its official opening day yesterday.

The issue offered 120 million shares at Rs. 10 each. A spokesman for financial advisor and manager to the IPO, Acuity Partners, said by 4.30 p.m. yesterday the LEF IPO had drawn 744 applications requesting for shares worth Rs. 1.46 billion, prompting its closure. The last biggest IPO was worth Rs. 1.6 billion by Amana Bank in December 2013 and that too was handled by Acuity Partners.

LEF is a subsidiary of Lanka Ventures Plc and was incorporated in 2006 for the purpose of consolidating LVEN’s energy sector investments. LEF has invested jointly with reputed project developers to develop and operate power generation projects (installed capacity of operational projects amounts to 136.6MW). LEF will be using IPO funds to retire some debt, retire some preference shares and to be invested in three new hydropower projects.
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