Sri Lankan shares edge up; political woes hurt sentiment

Sri Lankan shares inched up on Monday, recovering from a two-month low hit in the previous session, led by large caps, but trading was choppy as political woes ahead of an announcement on parliamentary election date weighed on sentiment.

The main stock index ended up 0.06 percent at 7,039.65, edging up from its lowest close since April 15.

Turnover stood at 488.9 million rupees ($3.7 million), its lowest since June 10 and less than half of this year's daily average of about 1.1 billion rupees.

"Investors are seriously looking for some kind of direction in politics either calling a parliamentary election or dissolution of the parliament," a stockbroker said on condition of anonymity.

"Uncertainty is killing the market. Buyers are waiting for some news. If they see the date for the election, they can at least plan their investments accordingly," the stockbroker said.

Foreigners are leaving because they want to reduce their exposure to the nation's risky assets, he said.

The market saw a net foreign outflow of 51.2 million rupees on Monday, extending net foreign sales in the past 19 sessions to 3.47 billion rupees.

The bourse, however, has seen net inflows of 2.46 billion rupees into equities so far in 2015.

Investors were confused due to a lack of direction on interest rates, economic policies, and on the timing of the parliamentary election, analysts said.

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

Shares in large cap Nestle Lanka ended 6.17 percent higher, while market heavyweight John Keells Holdings gained 1.16 percent. 

($1 = 133.9000 rupees) 

(Reporting by Shihar Aneez; Editing by Anand Basu)

Kalpitiya Beach Resort shareholders unanimously adopt alternate plan

The Board of Kalpitiya Beach Resort PLC announced that the Extraordinary General Meeting (EGM) of the Company that was adjourned on 08 May 2015 was held at 4.15 pm on 19 June 2015 and was duly terminated.

The EGM to seek shareholder approval for the implementation of the alternate plan of action as set out in the circular to shareholder dated 01 June 2015 was held on 19 June 2015 at 4.30 pm and the Ordinary Resolution set out in the notice of meeting in regard to this alternate plan was unanimously adopted by the shareholders at this meeting.

www.adadeana.lk

Sri Lanka’s Watawala Plantation share purchase

Jun 22, 2015 (LBO) Sri Lanka’s Watawala Plantations in a stock exchange filliing said that T Sinthilverl has purchased 457,301 shares of Watawala Plantations on 19, June for a price ranging 22.50 – 23.00 rupees.

“This increases his holding to 23, 788, 134 shares,” the statement said.

His holding in the share capital has now increased to 10.05 percent.

Sri Lanka vehicle registrations up 82-pct in May 2015

COLOMBO (EconomyNext) - Sri Lanka's vehicle registrations rose 82 percent from a year earlier to 38,398 unit in May 2015 amid historically low interest rates which boosted credit and discouraged savings.

Motor car registrations rose 205 percent in May to 5,999 units, an all-time record, sharply higher exceeding the 4,500 units a month seen during a credit bubble in 2011, an analysis of Sri Lanka's vehicle registry data by JB Securities, a Colombo based brokerage, shows.

Sri Lanka's car registrations started to pick up in the last quarter of 2011 as credit picked up, rising to 4,311 units in December from 2,411 units, mostly driven by hybrid vehicles.

In a budget in January 2015 taxes in hybrids were hiked, reducing imports, but those of small cars were cut slightly further boosting demand.

Taxes in electric cars are also at a low of 5 percent due to a state intervention leading to a surge in electric vehicles.

Registrations of Maruti/Suzuki cars which rose from 325 units in November 2014 to 1,100 in December and 1363 units in January hit 2,512 units in May.

Maruti Alto is now Sri Lanka's best-selling car with 2,311 units registered in May. Chines Geely Panda cars sold as Micro in Sri Lanka rose to 384 unit in May from 325 a month earlier.

SUV sales were down to 682 units in May from 1,591 units in January though still up from 404 units a year earlier, mostly due a reduction sharp fall in Honda Vezel hybrids to 308 units from a peak of 1,263 units in January.

Total hybrids dropped to 2,791 units in May 2015 from 4,320 in January. Sales of Zuzuki Wagon R, has started to pick-up, JB Securities said.

Three-wheeler sales continued their blistering pace, with 10,996 units registered in May 2015, up 91 percent from a year earlier.

Three wheelers are now increasingly used as a personal vehicle, J B Securities said.

Motor cycle sales were up 61 percent from a year earlier to 25,435 but down from a 42,331 unit peak hit in April, which was probably driven by concessionary vehicles given to state workers, J B Securities said which in another state intervention.

Sri Lanka's central bank has been intervening in interest rates releasing tens of billions of rupees in liquidity in addition to cutting rates as state salaries and subsidies were hiked and government domestic borrowings rose sharply, putting pressure on the balance of payments.

Citrus Silver subleases Steuart House for Rs 132 mn

Citrus Silver Limited, a fully owned subsidiary of Citrus Leisure PLC entered into a Sub Lease Agreement with George Steuart and Company Limited on Friday (19), to obtain a Sub Lease of the premises bearing Assessment No. 45, Janadhipathi Mawatha, Colombo 1 (formerly known as 'Steuart House') for a period of two years from 1st June 2015 at a total rental of Rs 132,300,000 (with the option for renewal for a further period of two years at the expiry of the initial term) to operate a Boutique Business Hotel comprising fifty (50) rooms under the name of 'The Steuart by Citrus.'

The Sub-Lessor, George Steuart and Company Limited (George Steuart) is a subsidiary of Divasa Equlity (Pvt) Ltd, which owns 9.92% of Citrus Leisure PLC. Further, the Sub-Lessor, George Steuart is the single largest shareholder of Citrus Leisure PLC, hodking 28.45% of the issued shares of the Company.

The Boutique Business Hotel 'The Steuart by Citrus' will be declared open on the 26 June 2015.
www.ceylontoday.lk

UB Finance to get Rs. 2B foreign investment - Plans for listing as well

By Ishara Gamage

Ceylon Finance Today: UB Finance Co Ltd, a subsidiary of Union Bank, is planning to tie up with the new foreign partner to expand its business, a senior official told Ceylon FT.

"They are willing to invest up to two billion rupees and negotiations are currently under way", the official said.

"This new investment is a part of our Colombo Stock Exchange listing process," he revealed.

Actually, TPG Capital (Major shareholder of Union Bank) is willing to invest it, but pooling knowledge is great advantage for us where we can have access to expertise, he remarked.

UB Finance Co, licensed by the Central Bank of Sri Lanka is currently providing range of financial services that include Fixed Deposits, Savings, Real Estate, Leasing, Hire Purchase, Loans Factoring and Pawning Solutions. Their services are mostly catering to small and medium enterprises.

The company was formed by Union Bank of Colombo PLC and its international strategic investment partner, Shore Cap II Ltd with a Rs 1.1 billion rupee capital infusion.

They have rescued thousands of customers who were victimized by the collapse of the Ceylinco regime.

Incorporated in 1961, it had previously belonged to the Ceylinco Group.

The Board of Directors of UB Finance is led by Chairman, Alexis Lovell, Chairman of Union Bank of Colombo. Ananda Atukorala – Deputy Chairman, Jit Warnakulasuriya, Daman Panditharatne, Davis Golding, Malinda Samaratunga, Ajith Wijeyesekera, Upali Wijeyesekera, Rohendra Wijeyesekera and Nalin Fernando.
www.ceylontoday.lk

Public sector listings needed for strong capital market

Hiran H.Senewiratne (hsenewiratne@gmail.com)

Public sector entities must list at least a considerable percentage of its stake to create an active and strong capital market, Colombo Stock Exchange (CSE) Chairman Vajira Kulatilaka said.

He said this is an alternative to privatization of state entities.

“The government should allow state owned entities to be listed in the CSE, without privatizing them. If that is allowed we could enlarge the scope of the market. In turn it will help establish a stronger capital market in the country and the region,” Kulatilaka told Daily News business.

He said that the CSE is one of the most sophisticated markets in the region and conforms to all global standards. Most important thing is to increase the number of public sector listing to broadbase its scope, he said.

Kulatilaka said strong risk management systems are in places and it is the best option for public to invest in the stock market rather than invest in other instruments. Because it has the potential to grow like other top stock markets in the region, he said.

He said that many years ago the CSE set records in the world. But it would bounce back very soon due to its new infrastructure development and structural changes.This has enabled to attract foreign investors slowly but steadily, he said.

Kulatilaka said all state banks, huge agriculture sector and transport sector companies have not been listed in the market.

“If we do encourage those entities to be listed in the CSE, we could create a vibrant stock market in the region,” he said.

The CSE Chairman also said the new government coming to power in the future must maintain a strong, consistent and sustainable growth for the next five years.

“If it’s so there is no doubt that we could create a strong stock market in the region,” he said.

The government also introduce a proper economic policy framework to encourage state owned entities to list some of its percentage like other countries in the region, he said.

Today more than 80 percent of entities are state owned entities. If those entities get listed in the CSE, we can create a strong capital market in the region with full of foreign direct investments, he said.
www.dailynews.lk