Sri Lankan shares end little changed

(Reuters) - Sri Lankan shares ended little changed on Friday, hovering near their lowest close in more than three weeks hit on May 30, as buying by foreign investors was offset by a fall in large caps such as Ceylon Tobacco Company PLC.

Analysts said continued foreign buying and expectation that interest rates would come down further will boost market sentiment.

The main stock index ended 0.02 percent, or 1.02 points, weaker at 6,279.14. On May 30, it had closed at its lowest level since May 7.

The bourse saw a net foreign inflow for the seventh straight session. Foreign investors bought 297.2 million rupees worth of shares on Friday, extending the year-to-date net foreign inflows to 4.18 billion rupees.

Turnover was 835 million rupees ($6.41 million), less than this year's daily average of 1 billion rupees.

Analysts said the market expects a further fall in interest rates after central bank governor Ajith Nivard Cabraal told Reuters on Friday that the central bank is creating room to cut interest rates further.

Cabraal signalled "a lot a space being created for some more dovish action".

Stockbrokers expect the market to gain in the near future due to lower interest rates after the central bank kept key rates at multi-year lows in May for the fourth straight month, as expected.

Shares of Ceylon Tobacco Company PLC fell 1.95 percent to 1,029.50 rupees. 

($1 = 130.3300 Sri Lankan Rupees) 

(Reporting by Ranga Sirilal; Editing by Subhranshu Sahu)

Sri Lanka stocks close lower

June 06, 2014 (LBO) - Sri Lanka's stocks closed lower with tobacco stocks losing ground despite net foreign buying mostly into Royal Ceramics, brokers said.

The Colombo benchmark All Share Price Index closed 1.02 points lower at 6,279.14, down 0.02 percent. The S&P SL20 closed 5.74 points higher at 3,479.17, up 0.17 percent.

Turnover was 835.02 million rupees, down from 896.19 million rupees a day earlier with 92 stocks closed positive against 79 negative.

Royal Ceramics Lanka closed 2.10 rupees higher at 102.00 rupees with two off-market transactions of 204.00 million rupees contributing 24 percent of the turnover.

The Finance Company non-voting closed 50 cents higher at 8.20 rupees and PC Pharma closed flat at 1.50 rupees, attracting most number of trades during the day.

Foreign investors bought 367.44 million rupees worth shares while selling 70.21 million rupees worth shares.

Ceylon Tobacco Company closed 20.50 rupees lower at 1,029.50 rupees, contributing most to the index drop.

Asian Hotels and Properties closed 2.30 rupees lower at 70.00 rupees and John Keells Holdings closed 10 cents lower at 234.90 rupees.

JKH’s W0022 warrants closed 20 cents higher at 64.20 rupees and its W0023 warrants closed 50 cents lower at 74.50 rupees.

AIA Insurance closed 20.00 rupees lower at 270.00 rupees and HNB closed 1.10 rupees lower at 156.40 rupees.

Carson Cumberbatch closed 2.90 rupees higher at 402.00 rupees and its oil palm firm Selinsing closed 99.00 rupees lower at 1,601.00 rupees.

CT Holdings closed 5.20 rupees higher at 139.90 rupees and Aitken Spence closed 1.60 rupees higher at 102.60 rupees.

Bukit Darah closed 6.20 rupees higher at 656.20 rupees.

Sri Lanka listed company profits slightly down in March quarter

June 06, 2014 (LBO) - Aggregate profits of listed Sri Lanka companies were down 2 percent from year earlier to 54.3 billion rupees in the March 2014 quarter though banks and hotels were showed profit gains, an equities research report showed.

CAL Research said in the December quarter aggregate profits rose 5.9 percent.

With 265 companies reporting, aggregate revenues had grown 7 percent to 473 billion rupees in the March 2014 quarter amid weak consumer spending, the report said.

CAL Research said aggregate earnings of the bank, finance and insurance sector grew 8 percent in the March 2014 quarter, compared to a 12 percent fall in profits last year.

Diversified holdings showed a profit gain of 5 percent to 13.7 billion rupees.

Profits of hotel and travels were up 18 percent to 4.5 billion rupees, amid a recovery in tourist arrivals.

Beverage food and tobacco was down 16 percent, chemicals and pharmaceuticals were down 163 percent largely on account of a net loss at CIC Holdings, footwear and textiles down 73 percent.

Though inflation was low in the past 12 months, the currency depreciated sharply in 2012 from 110 to 130 rupees to the US dollars. Credit growth has also been weak.

Though a consumption slowdown from weak credit is temporary, inflation effects of a devaluation permanently kill both real spending power and investible capital, economic analysts say.

Currency depreciation or the lack of sound money is the most powerful tool of impoverishing citizens in the hands of a modern state.

Fort the full year total profits were down 4 percent to 104 billion rupees.

The aggregate earnings were not adjusted for one-off items, CAL Research said. Piramal Glass had a 652 million rupee actual gain on a property sale, while Sri Lanka Telecom charged 673 million rupees after losing a court case.

Browns had an unrealized gain of 2.4 billion rupees and a 652 million rupee gain on disposal.

During the bubble years of 2010 and 2011, many companies showed profits from 'fair value' gains while others shifted assets around group companies including those with bigger minority shareholders to show profits, analysts say.

Sri Lanka bourse transfers 9 firms to default board

June 05, Colombo: Colombo Stock Exchange has transferred nine listed firms to the Default Board of the bourse, for non-submission of interim financial statements for the period ended on 31st March, 2014.

Accordingly, Ceylon Printers, East West Properties, Kalamazoo Systems, Office Equipment, Paragon Ceylon, PC House, Radiant Gems International, PC Pharma and PCH Holdings have been transferred to the Default Board.

The transfer is effective from the 5th of June, 2014.

http://www.colombopage.com/

Micro to float Rs 1.5b IPO

Shirajiv Sirimane

Sri Lanka's only car manufacture, Micro Cars Limited is to float at an Initial Public Offering to raise Rs. 1. 5 billion. This is to raise funds for their proposed car assembly factory which is being built at Hambantota. "We have obtained all the necessary approvals to launch this IPO, said Chairman CEO, Micro Cars, Dr. Lawrence Perera.

Micro Cars was established in 1999 and all the Micro vehicles are manufactured to world-class standards using components sourced from global leaders. The local value addition for the production is around 30%. The locally assembled cars also exported to Bangladesh and Nepal.
http://www.dailynews.lk

DFCC posts Group PAT of Rs 3.2 bn

The DFCC Bank has posted a profit after tax of Rs 3.2 billion for the group for the year ended March 31, 2014 in its Annual Report which was released this week. Disregarding a one-off tax refund of Rs 184 million included in the prior year profit after tax at the Bank and Group levels, the Group posted a commendable PAT of Rs 3,250 million under tough market conditions, marginally lower by 4% compared with Rs 3,390 million reported in the previous year. However total Group assets grew by 17% to Rs 177,333 million.

DFCC Bank, the premier development bank of the country, which approaches its sixtieth year, has over the years posted a consistent record of success by judiciously managing its business and expanding through a series of strategic acquisitions, alliances and partnerships. DFCC is one of the largest capitalised companies in the Colombo Stock Exchange valued at Rs 38,148 million. Its shares are widely sought and actively traded. Total income comprising of interest income and other income from the DFCC Banking Business (DBB) which includes DFCC Bank and its almost wholly owned subsidiary, by far the largest contributor to profits and asset growth of the Group, was Rs 20,214 million, an increase of 13.3% over Rs 17,837 million of the previous financial year. Interest income of DBB was up by 14.8% to Rs 18,467 million.

DFCC's new Chairman Royle Jansz said "DFCC's governing mandate has always been to provide long term financing to customers, which was unavailable to them elsewhere, to grow their business, not thinking solely about profitability, but of the benefit such businesses would bring to the economy of the country as a whole."

With regard to the proposed merger of NDB and DFCC, the CEO Arjun Fernando. states in his report "I prefer to view it as the next phase of DFCC's evolution where the Bank progresses to greater heights in a new form that is stronger, more dynamic and more enduring.

http://www.dailynews.lk

May tourist arrivals up 20%

Sri Lanka’s tourist arrivals rose 20.3 percent Year on-Year (YoY) to 90,046 in May 2014, with India, U.K and Germany leading the list, data released by the country’s tourism authority showed.