Sri Lankan stocks end steady; policy clarity awaited

Reuters: Sri Lankan stocks ended little changed on Thursday as gains in beverages and diversified shares helped offset losses in banking stocks, with investors waiting for direction on economic policy from the government, brokers said.

Prime Minister Ranil Wickremesinghe is expected to make a statement next month outlining the economic priorities of the newly-formed government, before the country presents its budget for the next fiscal year, which is estimated to show a 1.35 trillion rupees borrowing requirement from both foreign and domestic sources.

Sri Lanka's 2016 total expenditure is estimated at 3.14 trillion rupees ($22.36 billion) while the total revenue, including foreign grants, is estimated at 1.79 trillion rupees, a Cabinet spokesman said on Thursday.

The main stock index ended 0.20 points firmer at 7,085.65, nearly unchanged from Wednesday's close.

"The (market) ended flat for the day amid improved turnover. Buying in select manufacturing, banking, and food and beverage counters dominated turnover levels," John Keells Stock Brokers (Pvt) Ltd said in a note to investors.

Foreign investors sold a net 22.04 million rupees ($156,980.06) worth of shares on Thursday, extending the year to date net foreign outflow to 3.05 billion rupees.

Turnover stood at 849.7 million rupees, compared with this year's daily average of 1.11 billion rupees.

Gains in conglomerate John Keells Holdings Plc, which rose 1.17 percent, offset losses in Lanka ORIX Leasing Company Plc which fell 2.43 percent and Commercial Leasing & Finance Plc, which lost 4.88 percent. 

($1 = 140.4000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal)

BOC debenture nets Rs.12.47 b on opening day

The Bank of Ceylon, sealed its debenture issue being oversubscribed 2.5 times over its initial issue of Rs.5 billion on the opening day.

The Bank received applications far exceeding Rs.8 billion by 10.30 am.

With this issue, total listed debentures issued by Bank of Ceylon to the market would be Rs. 45 billion. The role played by the Bank of Ceylon in developing the debt market in Sri Lanka is significant.

Rated as AA by Fitch Rating Lanka these unsecured, subordinated and redeemable debentures which were priced considering its high credit worthiness will be listed on the Colombo Stock Exchange in accordance with the provisional approval obtained. These issued debentures have 5 year and 8 year maturities with fixed and floating coupon rates.

These 5 year and 8 year tenor allotment was based on proportion of the application bank received. Over 40% of the issue was allotted to 8 year applicants. Unlike before a higher number of applications for floating rates were received for this debenture issue.

The investors comprise of individuals, Corporates, SOE's, Trust Funds, Insurance Funds and financial institutions.

The demand received for this offering shows the confidence and trust the Bank has in the investor's mind. Funds raised through this debenture issue will be injected into the country's economic development through long term lending in development projects.
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