Sri Lanka stocks at 1-week low despite foreign inflows

(Reuters) - Sri Lanka shares fell for a third straight session on Wednesday to hit a one-week low despite foreign inflows as concerns over a proposed United Nations resolution, which may have an impact on the country's economy, dented sentiment, brokers said.

The main stock index fell 0.19 percent, or 11.05 points to 5,933.52, its lowest close since March 5.

Analysts said most investors were waiting for direction ahead of voting on the UN resolution later this month and to assess the impact it would have on Sri Lanka's economy and risky assets.

Shares of top conglomerate John Keels Holdings Plc fell 0.5 percent to 224.50 rupees.

Foreign investors bought a net 95.3 million rupees ($729,800) worth of shares on Wednesday, extending the net foreign inflow during the last six sessions to 236 million rupees.

However, Sri Lanka has seen net selling of stocks worth 5.19 billion rupees in the last 23 sessions as some offshore funds exited, while net outflows so far in 2014 stood at 3.8 billion rupees, after net inflows of 22.88 billion rupees last year.

Sri Lanka last week hit back at a report by the U.N. human rights chief, questioning the independence of the human rights office of the United Nations after the United States asked it to investigate violations by the Sri Lanka government.

The day's turnover was 408 million rupees, less than this year's daily average of about 980.3 million rupees. 

($1 = 130.5750 Sri Lanka Rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Anupama Dwivedi)

Sri Lanka stocks end down 0.2-pct

Mar 12, 2014 (LBO) - Sri Lanka's stocks close 0.19 percent lower Wednesday with leading food and beverage company losing ground, brokers said.

The Colombo benchmark All Share Price Index closed 11.05 points lower at 5,933.52 down 0.19 percent. The S&P SL20 closed 3.83 points lower at 3,236.29, down 0.12 percent.

Turnover was 408.01 million rupees, down from 804.56 million rupees a day earlier with 84 stocks close positive against 72 negative.

Commercial Bank closed 10 cents higher at 115.10 rupees with two off market transactions of 105.26 million rupees contributing to 26 percent of the turnover.

Nation Lanka Finance closed 40 cents higher at 8.20 rupees, attracting most number of trades during the day.

Foreign investors bought 258.02 million rupees worth shares while selling 162.75 million rupees of shares.

Nestle Lanka closed 40.00 rupees lower at 2,000.00 rupees and C T Holdings closed 8.90 rupees lower at 130.10 rupees, contributing most to the index drop.

SLT closed 70 cents lower at 44.00 rupees and Dialog Axiata closed flat at 9.00 rupees.

Asian Hotels and Properties closed 1.00 rupee lower at 58.00 rupees and John Keells Holdings closed 50 cents lower at 224.50 rupees.

JKH’s W0022 warrants closed 10 cents higher at 62.10 rupees and its W0023 warrants closed 30 cents higher at 65.80 rupees.

Bukit Darah closed 12.10 rupees higher at 550.10 rupees and Ceylon Tobacco Company closed 1.00 rupee lower at 1,140.00 rupees.

Sri Lanka fund takes 33-pct stake in Bangladesh power firm

Mar 12, 2014 (LBO) - Lanka Ventures Plc, a Sri Lanka based investment fund said it had invested 5 million US dollars for a 33 percent stake in Lakdhanavi Bangla Power Limited, which is building a 52.2 MegaWatt thermal power plant in Bangladesh.

The investment was made through its subsidiary Lanka Energy International (Pvt) Ltd, on March 11, Lanka Ventures said in a stock exchange filing.

Last January the firm had invested 2 million US dollars (255 million rupees) Raj Lanka Power Company Ltd to take a 16 percent stake. It also built a 52.2 MW power plant in Rajshani Bangladesh.

The plant had been connected to the Bangladeshi power grid on January 24, 2014.

The latest plant is being built in Comilla, Bangladesh.

With 653 million US dollar being invested in the second plant, Lanka Ventures said its power sector investments rose to 1,840 million rupees.

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http://www.cse.lk/cmt/upload_cse_announcements/9631394617080_.pdf

Sri Lanka Treasuries ease lower

Mar 12, 2014 (LBO) - Sri Lanka's Treasuries yields edged lower at Wednesday's auction with the 3-month yield down 02 basis points to 6.69 percent, the state debt office said.

The 6-month yield fell 03 basis points to 6.85 percent and the 12-month yield fell 01 basis point to 7.06 percent.

The state debt office said 500 million rupees in 3-month bills, 4.3 billion in 6-month bilsl and 13.4 billion rupees in 12-month bills were sold.

The debt office offered 10 billion rupees of bills and accepted 18.2 billion in bids.

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Sri Lanka Touchwood forestry firm trading suspended: regulator

Mar 12, 2014 (LBO) - Trading in Touchwood Investments Plc, a controversial forestry firm has been suspended pending the release of interim accounts, the Securities and Exchange Commission has said. Investors in the firm recently went to court seeking to liquidate it after it failed to give them promised returns.

The firm also used 'fair value' accounting, to show large profits.

Fair value accounting in general has been blamed for showing profits that are not actually generated but is simply inflation during bubble periods, and helping worsen asset price inflation and other effects of credit bubbles.

In Touchwood's case, immature tree growth was brought into the profit and loss account.

Analysts have warned about the promises of fixed returns made by forestry companies for over a decade (Green Blues) .

In 2007, Sri Lanka's accounting watchdog questioned its accounting practices, saying they were clearly unreliable , and the matter ended up in courts.

Later in the year its then auditors disclaimed the accounts.

Investors have lost money in forestry companies in many countries including India which prompted regulators to bring in rules.

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http://www.cse.lk/cmt/upload_cse_announcements/8721394594710_.pdf

Diversified Softlogic Group optimistic of boosting growth in 2014

By Charumini de Silva

Ceylon FT: Despite the challenging internal and external factors, Softlogic Group is optimistic of achieving a 15% to 20% growth by the end of this year.

Speaking to Ceylon FT Softlogic Holdings Chairman and Managing Director, Ashok Pathirage said that the company was focused aggressively on leveraging core competencies.

"We are looking forward to grow with Sri Lanka, while developing strong partnerships across many cross sectors of the economy," he said.

With significant contributions from the three core sectors — healthcare, ICT and retail, the company's overall performance has improved considerably, he added. Recognizing the potential of the tourism industry the group made long-term strategic investments in the leisure sector.

He said capitalizing on the booming tourism industry the firm expects to open its luxury hotel, Centara Ceysand Resort and Spa next month. The hotel consists of 168 rooms and was constructed with an investment of Rs 3.5 billion. In addition, the company expects to commence operations of our five-star city hotel – Movenpick – by the end of next year.

These two strategic moves have placed the group in place to harness the benefits of the tourism boom in the country. Pathirage said, "The group has identified the leisure sector as a strategic sector and we are quite buoyant on the developments that are taking place in the industry and economy as a whole. With the influx in the tourist arrivals especially from regional countries will help to maintain the momentum and will continue to grow steadily."

In a move to expand the company's retail chain, Softlogic has planned to increase the number of retail stores, while expanding the company's retail outlets in the country. "We have expanded ourselves at a healthy rate in the retail sector and will continue the impetus on the performance. With the opening of the new shopping mall at the former Auditor General's building, we will soon introduce another international brand to our retail portfolio," he said.

The firm has already bought around 40% of the space of the shopping mall to distribute the world's best brands to the Sri Lankan consumers.

The group owns a large market share of the growing private healthcare sector owning six large private hospitals and the hospitals are performing quite well with most being fully occupied. The Rs 3 billion Asiri Hospitals Kandy (Pvt) Ltd., will be open to the public in the near future, offering state-of-the-art facilities.

"Healthcare has been not only a business for the company but a service that we take great pride in. We are the largest in the market at present and have the capability to increase the private hospital charges overnight, where the rest of the market players would follow us. However, as a socially-responsible company and we are concerned about all segments of the masses in the country."

He said a well-functioning healthcare system is an indicator of a developed nation. Sri Lanka, has come a long way in the healthcare industry and has much scope to grow especially in the medical tourism sector, which could efficiently generate foreign exchange."

Softlogic Holdings PLC reported a Rs 803.12 million profit for the nine months ended 31 December 2013, up 321.55% from Rs 190.5 million a year ago. Revenue increased 14.32% to Rs 21.73 billion.
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