Sri Lankan shares rise on Keells; turnover slump

Sri Lankan shares edged up on Thursday for a second straight session, helped by market heavyweight John Keells Holdings, but turnover slumped to a more than one-week low as investors turned cautious ahead of a parliamentary election.

The main stock index ended 0.2 percent or 14.44 points higher at 7,064.15, further recovering from a two-month low hit on Tuesday.

Turnover stood at 566 million rupees ($4.22 million), its lowest since June 10 and half of this year's daily average of about 1.11 billion rupees.

"Market is up on Keells on very low volumes. There was lack of selling pressure that was seen in the last few days," said Dimantha Mathew, research manager at First Capital Equities (Pvt) Ltd. "We don't expect any significant movement to happen until the elections are announced."

Investors were confused due to lack of direction on interest rates, economic policies, and on when the parliamentary elections would be held, analysts said.

President Maithripala Sirisena's government has said it would dissolve parliament once some crucial reforms, including an electoral bill, are passed, but has yet to fix a date for the election.

Shares in conglomerate John Keells Holdings Plc ended 1.64 percent firmer in low volumes, helping the overall index end higher.

Nestle Lanka Plc rose 1.49 percent, while Sri Lanka Telecom Plc closed 1.1 percent higher.

The market saw net foreign inflow of 1.3 million rupees on Thursday, but it has suffered net foreign outflow of 3.32 billion rupees in the past 17 sessions. The bourse, however, has seen net inflows of 2.62 billion rupees into equities so far in 2015.

($1 = 134.0000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)

Sri Lanka’s govt to allow port city project if environmental report comes clean

June 18, 2015 (LBO) – Sri Lanka’s controversial port city project will be given a nod if there are no issues with the environmental report, cabinet spokesman said today.

“There had been an environmental report but the committee say it is not enough,” Rajitha Senarathne said.

“After a new report, the committee will decide whether to allow the project or not.”

It has decided that the Central Environment Authority will be instructed to start an environmental impact assessment with the assistance of relevant institutions.

On completion of the above study, the government will reconsider the recommencing activities of the

The decision was taken on the recommendations by the apex ministerial committee on the China Port City project and a cabinet subcommittee on economic affairs, he said.

The cabinet of Ministers also have given approval to the proposal made by Prime Minister Ranil Wickramasinghe to transfer the project from the Sri Lanka Ports Authority to the Urban Development Authority.

The 1.4 billion US dollar Chinese Port City is to be constructed between the Southern edge of the new Colombo South Port and the Fort Lighthouse.

The total area of sea to be reclaimed is 252 hectares.

However the government allowed, the Chinese construction company to build the 3.25 kilometer long break water of the port city, an offshore barrier, in order to prevent damage from heavy rains and sea erosion to the project.

Sri Lanka’s Adam Capital ventures into micro credit business

Jun 18, 2015 (LBO) – Sri Lanka’s Adam Capital has incorpotared their micro credit busines under the name of Adam Capital Micro Credit private limited to explore the micro finance sector in the island.

“Central Bank approval is not reqiired as the Micro Finance Act has not been passed in Parliament.” the company said in a stock exchange filing.

The new business is a wholy owned subsidiary of Adam Capital PLC.

The long awaited Micro Finance Act has already been drafted and expecting public proposals.

Sri Lanka’s Tokyo Cement invests in manufactured sand joint venture

COLOMBO (EconomyNext) – Tokyo Cement Company (Lanka) said it is to set up subsidiary to produce manufactured sand aggregates for concrete as natural sand extraction was becoming less of an option with sand reserves getting depleted.

The new firm will be called Tokyo Super Aggregate Ltd. and will be set up as a joint venture at a cost of around 220 million rupees, a stock exchange filing said.

Tokyo Cement will be taking a 51 percent equity stake in the joint venture with a local partner Raddella Engineering & Earth Movers (Pvt) Ltd. who has the experience and adequate technical know-how of this highly specialised product, it said.

The new firm will produce “high quality manufactured sand of a consistent quality and good equi-dimensional shape,” it said.

Tokyo Cement said that in the past natural sand extraction has been the backbone of the aggregate industry but is no longer so with new pit locations fewer, further from the market and harder to secure.

Sri Lanka tea crop recovers as global production falls

COLOMBO (EconomyNext) –Sri Lanka’s tea production has recovered this year and the island is the only major producer whose output is higher than last year with crops in other origins being lower, brokers said.

Global black tea production up to April this year has fallen by 11 per cent to almost 304 million kilos from the same period of 2014 with most of the shortfall coming from Kenya.

Kenya’s tea production has fallen by 30.51 million kilos to 81.57 million kilos up to March 2015 from a year ago.

Indian production is also lower this year by almost 11 million kilos, with the biggest drop seen in north India where output fell by 9.63 million kilos to 33.25 million kg up to March 2015 and South Indian crops down by 1.17 million kg to 47.38 million kg.

Sri Lanka is the only major producer with a higher output in 2015. Tea production up to April 2015 was up by 8.35 million kilos to reach 110.77 million kilos from the same period in 2014.

However, the global slump in commodity prices means returns to producers are lower with Colombo auction prices still below even 2013 levels, brokers said.

Production in Malawi, the other big East Africa producer, was down by 3.4 million kilos to 24.80 million kilos up to April 2015 from a year ago.