HWIC Asia Fund acquires 15% shares in Sri Lanka’s Nations Trust Bank

HWIC Asia Fund has acquired shares representing 15 percent voting rights of the Nations Trust Bank PLC.

HWIC Asia Fund is a multi-class investment company and its objective is long-term capital appreciation through investment primarily in securities of Asian companies.

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Hayleys MGT 2Q net profit improves 44%

The Hayleys group knitted fabric manufacturer, Hayleys MGT Knitting Mills PLC (MGT) posted a net profit of Rs.31.74 million (US $ 241,059) for the quarter ended September 30, 2014 (2Q15), up 44 percent from a year ago, according to the interim financial results.The earnings per share rose to 18 cents from 13 cents during the same period.

The company’s business expanded during the 2Q15 as its revenue rose by 3 percent year-on-year (YoY) to Rs.2.31 billion (US $ 17.58 million), while its gross profits were 12 percent higher at Rs.241.92 million (US $ 1.84 million), despite a 2 percent YoY rise in its cost of sales to Rs.2.07 billion (US $ 15.74).

However, there was a surge in distribution expenses by 231 percent YoY to Rs.40.5 million but the administration expenses were down 10 percent to Rs.129 million from a year ago.

The net financing cost was slightly down to Rs.37.56 million leaving a profit before tax of Rs.34.85 million, up 55 percent a year earlier.

The company’s functional currency is the United States dollar as its primary business is done in dollars but the presentation currency – the currency which the financial statements are prepared – is Sri Lankan rupees. During the quarter, the company raised Rs.526.3 million via a rights issue in order to retire its existing debts as a measure to strengthen its balance sheet.

The fund management arms of family controlled Carson Cumberbatch Group, Guardian Fund Management Group was seen buying into MGT until recently and the total stake by the group as of September 30, 2014 stood at little above 15 percent, being the second largest shareholder in the company.MGT has been reporting losses since the company reported a fraud relating to stocks in 2011 and the losses for the year ended March 31, 2014 were Rs.183.37 million (US $ 1.39 million).However, the future industry outlook remains positive despite the presence of much larger competitors such as Textured Jersey Lanka PLC and Ocean Lanka Limited – both are units of Brandix Lanka, Sri Lanka’s largest apparel exporter due to the overall positive macro economic conditions and the recovery in the US economy.

Meanwhile, for the six months ended September 30, 2014 (1H14), the company increased its net profits by as much as 150 percent YoY to Rs.36.47 million on revenue of Rs.4.29 billion.The company has an asset base of Rs.5.88 billion. Hayleys PLC had a 58.96 percent stake in the company as of end September.
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Sri Lankan stocks at over three-week high on banks, diversified shares

Nov 3 (Reuters) - Sri Lankan stocks rose for an eighth straight session on Monday to close at a more than three-week high, led by banks and diversified shares, with foreign buying in risky assets and hopes of better corporate earnings boosting sentiment.

Sri Lanka's main stock index ended up 0.36 percent, or 26.34 points, at 7,353.15, its highest close since Oct. 9.

"We are seeing moderate investor interest in all segments. They are waiting to see the outcome of earnings," said Dimantha Mathew, manager, research at First Capital Equities (pvt) Ltd.

Monday's turnover was 1.68 billion rupees ($12.8 million), well above this year's daily average of 1.38 billion rupees.

Net foreign inflows were 477.4 million rupees, extending the year-to-date inflows to 15.25 billion rupees, exchange data showed.

Top listed lender Commercial Bank of Ceylon Plc led the gains with a rise of 2.29 percent to 169.60 rupees, while diversified conglomerate Hemas Holdings Plc jumped 5 percent to 73.50 rupees.

Analysts expect trading to be choppy in the near-term due to the revised presidential poll schedule in January and a possible bottoming out of interest rates.

The country's central bank has kept key policy rates steady for a ninth straight months, saying private sector credit growth was picking up and long-term lending rates were adjusting downwards.

President Mahinda Rajapaksa will seek an early re-election in January, seeking to pre-empt any decline in support after nearly nine years in power. 

(1 US dollar = 130.8000 Sri Lankan rupee) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Prateek Chatterjee)

Sri Lanka stocks close up 0.36-pct

Nov 03, 2014 (LBO) - Sri Lanka's stocks closed 0.36 percent higher with Commercial Bank gaining amid net foreign buying, brokers said.

The Colombo benchmark All Share Price Index closed 26.34 points higher at 7,353.15, up 0.36 percent. The S&P SL20 closed 17.31 points higher at 4,104.69, up 0.42 percent.

Turnover was 1.69 billion rupees, down from 3.81 billion rupees last Friday with 119 stocks closed positive against 76 negative.

Nations Trust Bank closed 1.80 rupees higher at 95.70 rupees with two off market transactions of 246.03 million rupees changing hands at 95.00 rupees per share contributing 15 percent of the turnover.

The aggregate value of all off-the-floor deals represented 28 percent of the daily turnover.

Abans Finance closed 5.30 rupees higher at 31.50 rupees and Softlogic Holdings closed 50 cents higher at 16.50 rupees, attracting most number of trades during the day.

Foreign investors bought 604.96 million rupees worth shares while selling 127.54 million rupees worth shares.

Commercial Bank of Ceylon closed 3.80 rupees higher at 169.60 rupees, contributing most to the index gain.

Sri Lanka Sampath Bank to issue debenture

Nov 03, 2014 (LBO) – Sri Lanka, Sampath Bank to issue debenture to raise 60,000,000,00 rupees which will be listed on the Colombo Stock Exchange, the bank said in a stock exchange announcement.

The bank will issue 60,000,000 debenture at a rate of 100 rupees per share subject to the necessary regulatory approval.

The company said it will issue up to a further 10,000,000 in the event of an over subscription.

SLT to invest Rs 2b to enhance infrastructure

H.D.H Senewiratne (hsenewiratne@gmail.com)

Sri Lanka Telecom Plc (SLT) will invest Rs 2 billion for the next two years for the infrastructure development, technology transfer, and increase operational efficiency and many other development activities.

“Under the new development programme we are hoping to roll our new technology, development of ICT to introduce cloud technology, introduce high capacity submarine cables to increase the efficiency and effectiveness in Sri Lanka’s entire telecommunication sector,” its Chief Executive Officer Lalith de Silva told the Daily News Business.

He said all their strategies are aligned to the country’s ICT plan in order to move towards a digital era in order to facilitate the government’s ‘SMART Sri Lanka” programme.

“SLT has also invested over Rs 2 billion in the last two years and decided to invest a further Rs 2 billion to facilitate the country’s five hub status because ICT will play a pivotal role to for the sustenance of the five hub concept,” De Silva said.

“We have to embrace technology, cloud computer, data transmission and Internet of Everything (IOE), social media to compete with regional and international competition. With our new development strategies we are now on par with any developed country in the world,” De Silva said.

He said that as the national telecommunication service provider, the company plays close attention to improving digital literacy across the country when designing policies for our network and infrastructure expansion, and continuously work towards bridging the digital divide by enhancing accessibility and affordability of broadband and ICT technologies to all people throughout Sri Lanka.

The company is also passionate about creating a future ready new generation and empowering women through ICT education and awareness given ICT’s crucial role in bridging the gender digital divide and in accelerating the nation’s development, he said.

“Through introducing the right technology at the right time, to the right place, we also seek to empower the education, health and entertainment sectors as well as professionals, promoting the digital lifestyle to enhance the living standards of the people, transforming the way people work, study, play and entertain themselves,” he said.

“To go beyond the company’s core business to empower individuals, organizations and professional bodies, schools, hospitals and institutes, sports and worthy causes through various means,” he said.
www.dailynews.lk

Pensions for all!

By Mario Andree

Ceylon Finance Today: The government's decision to introduce a special pension scheme and incentives for migrant workers would benefit the economy as well as the people according to a senior minister, who claimed that Sri Lankan salary structures would improve.

Minister of Investment Promotion Lakshman Yapa Abeywardena told journalists in Colombo that the government's intensions were to reward high earning foreign workers for their immense contribution for the development of the economy.

Ceylon FT highlighted that at a time when the manufacturing sector was severely complaining of labour shortages, created by more and more people seeking foreign employment, the government's decision to introduce a pension scheme would make migration more lucrative creating a further dearth of labour in Sri Lanka.

However, Minister Abeywardena disagreeing, highlighted Sri Lanka was no longer a cheap labour destination, with its highly skilled labour pool, to attract labour intensive manufacturing plant, which required minimum skills.

According to him, while more skilled migration would in return earn increased remittances to the country to support.....the anticipated 8% GDP growth, it would also encourage more sophisticated industries to set up factories here offering higher salaries to local skilled workers.

Highlighting a 15,000 shortage of labour in the BOI zones, he said the private sector in the medium and long term would have to offer high salaries to retain workers.

According to him, while capturing sophisticated industries to industrial parks, which would offer higher wages, labour intensive manufacturing plants were planned to be shifted to rural areas creating jobs to low skilled population of the country.

Nearly two million skilled Sri Lankans, a relatively large number, were engaged in high paying jobs in overseas destinations, while the number of low skilled migrations has decreased.

Presenting the Budget, President Mahinda Rajapaksa told Parliament, that considering the increased amount of remittances by migrant workers, he proposed to allocate a further Rs 500 million to develop five dedicated vocational schools in Badulla, Kurunegala, Hambantota, Vavuniya and Ampara districts to increase the skills of those seeking foreign employment.

He also proposed to provide duty permits to import vehicles up to 60% of the remittance value to a local bank, for high income earning Sri Lankans working overseas, as well as a special pension scheme.
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