Sri Lanka stocks at 1-week high on lower rates, Keells up on foreign buying

(Reuters) - Sri Lankan stocks rose for the second straight session on Wednesday to hit one-week highs, as lower interest rate helped boost local investor sentiment, while foreign investors bought market heavyweight John Keells Holdings Plc.

The main stock index rose 0.17 percent, or 10.68 points, to close at 6,321.55, its highest since June 17.

Analysts said the market would move sideways in the short term with lower risk due to lower interest rates.

Yields in treasury bills edged down further on Wednesday at a weekly auction.

Market heavyweight John Keells Holdings, which ended 0.95 percent firmer, accounted for 34.8 percent of the day's turnover.

The bourse saw a net foreign inflow of 138.7 million rupees ($1.07 million) worth of stocks on Wednesday, extending the net foreign inflows so far this year to 5.97 billion rupees.

Turnover was 705.3 million rupees, less than this year's daily average of 997.1 million rupees.

Analysts said investors were awaiting to see the impact of the recent ethnic violence and possible implications after a government spokesman said Sri Lanka bought Iran crude via third parties.

Stockbrokers said investors perceive the violence in the previous weekend that killed at least three people could hit the market and the tourism sector.

Sri Lanka's government spokesman said on Thursday the island nation has been buying Iranian crude from various countries via third parties, and avoiding Western sanctions with the understanding of the United States. The United States denied the claim.

The market has been on a rising trend since late February due to continued foreign buying and lower interest rates. ($1 = 130.2000 Sri Lankan Rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Anand Basu)

Sri Lanka Treasuries edge lower

June 25, 2014 (LBO) - Sri Lanka's Treasuries yield eased lower across maturities at Wednesday's auction, data from the state debt office said.

The 3-month yield fell 02 basis points to 6.51 percent and the 6-month yield also fell 02 basis points to 6.69 percent.

The 12-month yield fell 01 basis point to 6.99 percent.

The debt office said 1.00 billion rupees in 3-month bills, 1.00 billion in 6-month bills and 20.00 billion in one year bills totaling 22.00 billion rupees were sold after offering 12.00 billion for rollover.

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Sri Lanka shares close up 0.2-pct

June 25, 2014 (LBO) - Sri Lanka's shares closed 0.17 percent higher with index heavy John Keells Holdings contributing most to the index gain for the second straight session amid net foreign buying, brokers said.

The Colombo benchmark All Share Price Index closed 10.68 points higher at 6,321.55, up 0.17 percent. The S&P SL20 closed 5.43 points higher at 3,501.55, up 0.16 percent.

Turnover was 705.26 million rupees, down from 874.88 million rupees a day earlier with 84 stocks closed positive against 86 negative.

John Keells Holdings closed 2.10 rupees higher at 223.90 rupees with three off-market transactions of 132.79 million rupees changing hands at 223.00 rupees per share contributing 19 percent of the turnover.

JKH’s W0022 warrants closed 80 cents higher at 60.80 rupees and its W0023 warrants closed flat at 71.00 rupees.

The aggregate value of all off-the-floor deals represented 24 percent of the daily turnover.

Central Investments and Finance closed 50 cents higher at 1.20 rupees, attracting most number of trades during the day.

Foreign investors bought 345.29 million rupees worth shares while selling 206.57 million rupees worth shares.

Property Development closed 16.10 rupees higher at 102.20 rupees and East West properties closed 10 cents higher at 13.00 rupees.

Lanka Orix Leasing Company closed 1.90 rupees higher at 91.90 rupees and Union Assurance closed 3.90 rupees lower at 106.10 rupees.

Cargills Ceylon closed 4.80 rupees lower at 150.00 rupees and Nestle Lanka closed 10.60 rupees lower at 1,930.40 rupees.

Hayleys closed 5.00 rupees lower at 285.00 rupees and Aitken Spence closed flat at 104.00 rupees.

Adam Investments has acquired 18,516,585 shares of PC Pharma on June 23, 2014 amounting to 18.33 percent of the shares of PC Pharma on the trading floor of the CSE, the firm said in a stock exchange filing.

NDB makes Rs. 600 per share buy-back offer on NDB Capital

Parent NDB has announced a share buy-back offer on NDB Capital Holdings Plc (NDBCH) at Rs. 600 each prior to delisting the subsidiary from the Colombo Stock Exchange.

NDB owns a 99.62% stake in NDBCH, of which the number of shares in issue is 32.904 million. The total offer is worth Rs. 76 million. NDB said the offer price of Rs. 600 was a fair price. The move is subject to shareholder and regulatory approval.

Net asset value per share of NDBCH at Company level is Rs. 170.24 as at 31 March 2014 was, up from Rs. 160.17 a year ago. At Group level it was Rs. 176.90. In the first quarter highest traded price of NDBCH was Rs. 550 and the lowest was Rs. 485 before closing at Rs. 535.

NDBCH has 339 shareholders of whom 309 own between one and 1,00 shares with a total of 34,622 shares or just 0.10% and a further 28 holding a collective 80,864 shares or 0.25%. 

There are 316 individual shareholders holding 113,176 shares.

The market value of ordinary shares on 31 December 2013 was Rs. 490 per share. The highest traded price in 2013 was Rs. 550 and the lowest was Rs. 400.

In 2013, NDBCH paid a Rs. 16.40 dividend per share or 164% following extraordinary capital gains from the sale of its stake in Aviva NDB Insurance. In the preceding past five years the dividend per share had ranged between a high of Rs. 4.10 and a low of Rs. 1.25.
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Lucky to get lucky on 7 July with Rs. 300 m

Lucky Lanka Milk Processing Company Ltd. is planning to raise Rs. 300 million via an Initial Public Offer to be opened on 7 July. It will be offering 38,000,000 ordinary voting shares at a price of Rs. 6 and 24,000,000 ordinary non-voting shares at a price of Rs. 3. The shares will be listed on the Diri Savi Board of the Colombo Stock Exchange.

The Corporate Advisory & Capital Markets division of Merchant Bank of Sri Lanka PLC will act as the Investment Banking Advisors to the issue whilst and Bank of Ceylon will be the Bankers to the issue.

Out of the proceeds, Rs. 200 m will settle the high cost borrowings, which in turn is expected to boost the net profits immediately. Rs. 75 m will fund the expansion of the existing production plant with new cold room complex with an ammonia refrigeration system, extension to the existing UHT milk processing building and new machinery including conveyer systems and pigging systems. The remaining Rs. 25 m will be utilised for new projects such as Gedarata Kiri, Milk Bar Outlet and School Canteen.

Lucky began its life in 1991 as a domestic business with the excess milk of the household 

cows. Present Chairman Lal Keerthi Gunawardhana then at the age of 20 started this business with the support of his family members. Today, it operates in Kamburupitiya with a factory capacity of 20,000 litres per day.

At a national level enterprise, it has more than 5,000 farmers and seven milk chilling centres located in Bandegamma, Pannegamuwa, Wellawaya, Embilipitiya, Matara, Welimada and Bandarawela.

Lucky has six warehouses, 105 vehicles with refrigeration facility, over 50 distribution points and more than 15,000 outlets, which allows Lucky to gain significantly with the expansion plans in the post IPO era.

Moreover, the company operates in the Western (35% of sales), Southern (36% of sales) and Central (29% of sales) Provinces in the country. Revenue for 2014 reached Rs. 896.5 m compared to Rs. 841.8 m in 2013 with an asset base of over Rs. 750 m.

As the Investment Banking Advisors to the issue, Merchant Bank of Sri Lanka is confident on the IPO as it will cater to all types of investors and provide market momentum.
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Renuka to invest Rs. 70 m in organic agri biz

Renuka Shaw Wallace Plc has decided to invest Rs. 70 million in expanding its footprint in organic agriculture.

The investment involving a 50% stake or 0.5 million ordinary voting shares at Rs. 140 each is into Renuka Organics Ltd. The subsidiary is a Board of Investment approved venture which is a vertically-integrated certified organic agriculture products growing, manufacturing and export marketing company.
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BAT sells 16% stake in PC Pharma

British American Technologies Ltd., (BAT) has sold a 16.05% stake in loss-making PC Pharma PLC yesterday for Rs. 20 million.

The price at which the stake was divested ranged between a high of Rs. 1.40 per share and a low of Rs. 1.20 per share. The biggest block of 11 million shares was done at Rs. 1.20 each.

As at end 2013, BAT held a 17.2% stake in PC Pharma. BAT acquired a 24% stake or 24.36 million shares in PC Pharma in August last year from PCH Holdings PLC at Rs. 1.50 per share.

The second largest shareholder was S.H.M. Rishan with a 20% stake whilst PCH Holdings held a further 29% stake. Some of the personal holdings had been sold in May at 80 cents per share.

In January, investor S.C. Hiththatiyage acquired a 10.26% stake PC Pharma.

In the first nine months of FY14, PC Pharma made a Rs. 102 million loss and had retained loss of Rs. 71.5 million.
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