Sri Lankan stocks fall as foreigners turn net sellers after 5 weeks

Dec 9 (Reuters) - Sri Lankan stocks edged down on Tuesday in sluggish trade, with large-caps such as Ceylon Tobacco Co Plc leading the falls as investors remained cautious ahead of the presidential poll next month.

The main stock index fell 0.32 percent, or 23.53 points, to close at 7,217.94.

Foreign investors turned net sellers for the first time in five weeks on Tuesday, offloading shares worth a net 106.8 million rupees, But they have net bought 21.81 billion rupees worth of stock this year, exchange data showed.

Turnover was 790.7 million rupees ($6 million) on Tuesday, according to the data, a little more than half of this year's daily average of 1.43 billion rupees.

"The market is volatile. With the recent crossovers, investors are waiting for direction," said Reshan Kurukulasuriya, chief operating officer of Richard Pieris Securities (Pvt) Ltd.

"What we see is a small hiccup."

Analysts said many investors were staying away ahead of the elections and the festive season.

Ceylon Tobacco ended 3.27 percent lower, while Shalimar Estate fell 15.15 percent.

Analysts expect volatility to continue and the overall index to be flat until the elections on Jan. 8, with speculation over more defections and likely violence ahead of the polls also weighing on sentiment.

Nine loyalists from President Mahinda Rajapaksa's United People's Freedom Alliance, including former health minister Mithripala Sirisena, have defected since Rajapaksa announced snap elections last week. Sirisena resigned to contest against Rajapaksa as the consensus candidate of a united opposition.

Speculation over more defections also weighed on sentiment, analysts said.

Nineteen candidates, including Rajapaksa and Sirisena, have submitted their nominations for the polls. 

($1 = 130.9500 Sri Lankan rupees) 

(Reporting by Ranga Sirilal; Editing by Prateek Chatterjee)

Sri Lanka Abans to offer Rs 2bn debenture issue

Dec 09, 2014 (LBO) – Sri Lanka, Abans Plc to issue debenture to offer 10,000,000 rated senior unsecured redeemable debentures at an issue price of 100 rupees per share, the company said in an announcement of Colombo Stock Exchange.

The company said it will issue up to a further 10,000,000 of the said debentures in the event of an oversubscription of the initial issue.

The subscription list will open on 18th December 2014.

Sri Lanka’s Alliance Finance to offer Debenture

Dec 09, 2014 (LBO) – Sri Lanka’s Alliance Finance Company Plc to issue debenture to offer 7,500,000 rated senior unsecured redeemable debentures at an issue price of 100 rupees per share, the company said in an announcement of Colombo Stock Exchange.

The company said it will issue up to a further 2,500,000 of the said debentures in the event of an oversubscription of the initial issue.

The subscription list will open on 19th December 2014.

Growth momentum continues at Vallibel Finance - Assets rise over 26%

Vallibel Finance returned an impressive all-round performance on the back of a strong first half. The company announced an interest income of Rs 1,393 Mn for the six months ending September 2014, an increase of 20% from the same period in the preceding year. 

The name-bearer of the iconic Vallibel Group continues to enjoy public confidence with its fixed deposits swelling by 35% to a landmark Rs 10.2 Bn. The deposit base stood at Rs 7.6 Bn during the same period in 2013. The climb amplifies the company’s ability to sustain a healthy deposit portfolio even during challenging times. Total assets saw a steady ascend, rising 26% to cross above the Rs 13.7 Bn mark.

The PBT during the period under review was Rs. 241 Mn while the PAT rose 8% from Rs. 135 Mn to a healthy Rs 147 Mn. "We strongly believe in building on exemplary values that build trust. The results are, yet again, an overwhelming vote of confidence for the company and will spur us on as we evolve in size and capacity. We are driving on the cutting-edge but what makes our performance all the more noteworthy is how we focus more on building a quality portfolio through personalized efforts", says Mr. Jayantha Rangamuwa, Managing Director of Vallibel Finance PLC.

Vallibel Finance was ranked amongst the top 50 most respected entities in the country by LMD in its 2014 survey and its significant rise in brand equity was recognized in LMD’s top 100 Most Valuable Brand Survey 2014 where Vallibel Finance’s rank rose to 67th, standing alongside some of the greats of the banking and finance sectors.

Mr. Rangamuwa reiterates that continuous good performance in a competitive and volatile industry mute testimony to the core strengths on which a business is built. "The macro-economic landscape saw challenging times yet again but the company’s resilient performance reinforces its growing stature in the public domain. We have systems and processes built on accountability and our customer interface is driven on offering financial solutions that understand people’s aspirations and ability", he says.

The company continues to expand geographically and has seen new Service Centers operating with state-of-the-art technology in Kalutara and Anuradhapura with openings slated for Kegalle, Narahenpita,Kaduruwela and Wattala with the aim of improving the access of the public to its unique financial service portfolio. Vallibel Finance deals chiefly in Hire Purchase, Leasing, Pawning (Gold Loan), Fixed Deposits, Group Personal Loans, Mortgage Loans, Education Loans and Microfinance products deployed via a cutting-edge technological framework.

The increasing stature of Vallibel Finance, on the back of its impressive performances, is further augmented by the highly powerful Vallibel conglomerate led by visionary corporate leader Mr. Dhammika Perera. Vallibel Finance’s standing in the business landscape is also affirmed by the upgrading of its rating to BBB- by Lanka Rating Agency.
www.island.lk

Browns Group’s entry into healthcare sector

Leading blue chip conglomerate, the Browns Group of Companies recently marked its significant entry into Sri Lanka’s healthcare sector with the soft opening of the Browns Hospital Ragama.

Present on the occasion were Executive Chairman of the Browns Group Ishara Nanayakkara, the Board of Directors, Senior Management, Director / CEO of Browns Hospitals / Healthcare Dr. Sajeeva Narangoda, Consultants and Doctors. Blessing the launch of this new hospital took the form of a religious ceremony conducted by the multi-religious clergy.

Browns Hospital Ragama is the latest venture of Brown & Company PLC and the first in a chain of secondary care general hospitals and diagnostic centres aimed at delivering high quality care through comprehensive, integrated clinical practice and personalised care, to every patient. Armed with the strong family brand name of ‘Browns’, this hospital will reach out to both rural and urban citizens in Sri Lanka with a range of innovative and patient-centric solutions.

Strategically located on the main Ragama Road and in close proximity to the Ragama Teaching Hospital and the Ragama Railway Station, this fully fledged multi-specialty General Hospital is equipped with the latest medical diagnostic technology, including modern CT and MRI scanning, and advanced medical and surgical therapeutic technology.

Its medical team comprises highly qualified and recognised visiting consultants in all specialties and in-house doctors as well as top-notch nursing care. Experienced and qualified nurses hailing from both the government and private sector constitute the nursing cadre at Browns Hospital.

Director / CEO of Browns Hospitals / Healthcare Dr. Sajeeva Narangoda said, "We are a healthcare organisation which is totally focused on healthcare services and determined to revolutionise the provision of healthcare service in Sri Lanka. This we will achieve through integrated clinical practice with our caring health care professionals who, at all times, uphold high standards of care and assure patient safety, utilising the latest available technology".
www.island.lk

CBSL to keep its policy rates unchanged for record 11th month

By Paneetha Ameresekere

Ceylon Finance Today: Markets are in a peculiar position of having a surfeit of excess liquidity due to foreign borrowings by the State and its agents, while the country's foreign reserves are under pressure due to Central Bank of Sri Lanka's (CBSL's) continuous protection of the rupee, market sources told Ceylon FT.

As a result, CBSL on a net basis has expended US$ 315.80 million from its foreign currency reserves in the three months to November to protect the rupee, data showed.

"In this backdrop, Government of Sri Lanka (GoSL)/CBSL should reimpose high import taxes and high interest rates in order to mitigate pressure on CBSL's reserves from an economic perspective," they said. But, on the other hand, GoSL has reduced import taxes, decreased administered prices and hiked salaries in recent times, thereby causing imports to increase, the sources said.

"This is causing pressure on the rupee to depreciate, while at the same time due to CBSL's protection of the rupee, that is also causing a strain on CBSL's reserves," they said. But, considering recent political developments, CBSL will keep its key policy rates unchanged for a record 11 months when it releases the current month's monetary policy review on Friday (12 December), sources said.

CBSL's standing deposit facility (SDF) and standing lending facility (SLF) are at 6.5% and 6.80% currently.

Excess liquidity recorded yesterday was Rs 29,155 million.

"If it cut its rates due to a surfeit of excess liquidity, savers will then complain that it would be a further blow by inducing deposit rates to come down further, thereby impinging on their livelihoods because they are dependent on interest income for a living," sources said.

"On the other hand, if it raises rates in order to protect its foreign reserves, consumers will complain because borrowings have become more expensive," they said. Meanwhile, private sector credit growth has fallen to an abysmally low 4.6% on a year-on-year basis as at September, according to latest data, compared to a record 34.5% growth in recent times, that is, in December 2011.

Therefore, an increase in rates may fuel the possibility that it will further impinge on private sector credit growth, they said. Therefore, rates remain unchanged on Friday, they added.

Meanwhile, despite moral suasion, the exchange rate closed weaker by 10 cents to Rs 131.95 to the US dollar in interbank spot next next trading yesterday due to Bank of Ceylon and People's Bank buying dollars from the market in order to settle Petroleum Corporation's petroleum bills, sources said.

In the Treasuries market, the more liquid 2022 maturity closed unchanged at 8.30-40% levels yesterday, after seeing its yields increase by 30 basis points since October after CBSL reversed a decision when issuing its September monetary policy statement on 23 September, 2014 that it will suspend its repo purchases till further notice in order to keep its policy rates at a low five per cent, only to re-start repo auctions in under two weeks in early October to boost rates in order to win the support of savers.

Yesterday's repo auction fetched a yield of 5.99%, 99 bps more than its SDF rate of five per cent for all practical purposes, due to its 23 September ruling which said that banks which park their excess for more than three days in CBSL's SDF window, will be paid a low five per cent interest rate, compared to the standard SDF rate of 6.5%.

Sources also said that the more liquid 2019 maturity closed unchanged at the 7.35-45% levels yesterday, after seeing its rates also increase sharply after 23 September decision of CBSL's being reversed. Sources said that this state of affairs, especially in regard to the exchange rate will continue till polls day, 8 January, 2015.
www.ceylontoday.lk