Sri Lankan shares end at over one-month closing low

Reuters: Sri Lankan shares edged down on Tuesday as investors sold banking and large cap stocks amid lack of new catalysts for buying risky assets, and on concerns over foreign investment outflows and rising interest rates.

The benchmark Colombo stock index ended 0.04 percent, or 2.34 points, weaker at 6,550.51, its lowest close since April 29. The index declined 0.94 percent during last week.

"Not much of retail activities in the market," said Atchuthan Srirangan, a senior research analyst at First Capital Equities (Pvt) Ltd.

Analysts said market sentiment was weak as investors were waiting for catalysts such as a big foreign direct investment or initial public offering or inflows from the International Monetary Fund.

Rising interest rates also weighed on the market with treasury bill yields rising between 5 and 27 basis points to near three-year highs at a weekly auction last Wednesday, despite the central bank leaving key policy rates steady for a third straight month.

Foreign investors have been net sellers of 5.58 billion rupees ($37.75 million) worth of equities so far this year, but they bought a net 49.7 million rupees worth of shares on Tuesday, the first net foreign inflow in five straight sessions.

Turnover stood at 700.3 million rupees, lower than this year's daily average of around 795 million rupees.

Shares in biggest listed lender Commercial bank of Ceylon Plc fell 0.93 percent while those in Hemas Holdings Plc dropped 2.93 percent and Distilleries Company of Sri Lanka fell 0.92 percent, dragging the index down.

Shares in top conglomerate John Keells Holdings, ended steady and accounted for 48 percent of the day's turnover.

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Anupama Dwivedi)

CEAT Sri Lanka to raise radial tyre capacity by 75-pct

ECONOMYNEXT - CEAT Sri Lanka has announced it will invest Rs 800 million over the next 12 months to increase radial tyre production capacity by 75 per cent, to 70,000 tyres a month from 40,000 to meet growing local and export demand.

The company said in a statement it currently has a 30% share of the radial tyre market and supplies nearly half of Sri Lanka’s overall requirement of pneumatic tyres.

About a third of CEAT Sri Lanka’s current tyre production is exported to 15 countries in South Asia, the Middle East, Africa and the Far East.

The new expansion comes two years after CEAT Sri Lanka commissioned a Rs 600 million radial tyre manufacturing plant at the company’s Kelaniya complex to produce tyres for cars and sports utility vehicles (SUVs).

“Our new investment entails a virtual replication of the plant we opened in July 2014, with new hi-tech machines,” CEAT Sri Lanka Managing Director Vijay Gambhire said.

“This bold decision to almost double production reflects our commitment to Sri Lanka and our confidence in the potential of our tyres to compete with global brands in the domestic and export markets. With this investment, CEAT Sri Lanka’s total investment will rise to Rs 3.8 billion.”

The new machines to be installed would produce 13 sizes of radial tyres, increasing production of several existing sizes as well as adding new sizes to the company’s radial tyre portfolio, which already comprises of 33 sizes - 20 for cars, eight for vans and five for SUVs, Gambhire said.

CEAT Sri Lanka Vice President Sales, Marketing & Exports Ravi Dadlani said the increase in production capacity and the introduction of new sizes will give the firm the potential to double market share.

Among the 13 CEAT radial tyre sizes to be manufactured when the latest phase of expansion is complete, are 31x10.5 R 15 All-Terrain tyres, 265/70R16 H/T, 205/75R 14 H/T and 205/75R15 H/Ttyres under CEAT’s Czar brand, and two export sizes - 215/70 R 15 C and 225/70 R 15 C.

Sri Lanka's Distilleries group net up 9.8-pct

ECONOMYNEXT - Profits at Distilleries Company of Sri Lanka which has interests in alcohol, insurance, plantations and telecoms rose 9.8 percent to 1.358 billion rupees in the March 2016 quarter from a year earlier, helped by the beverage business.

The group reported earnings of 4.53 rupees per share for the quarter. In the year to March profits of 21.16 rupees per share on total profits of 5.6 billion rupees, which were down 32 percent.

At the core alcohol firm net revenues (without taxes) went up 40 percent to 6.2 billion rupees, cost went up at a faster 57 percent to 3.3 billion rupees, but gross profits also rose 24 percent to 2.8 billion rupees.

At group level, revenues went up 28 percent to 9.3 billion rupees, cost and claims went up 27 percent to 6.2 billion rupees, and gross profits rose 30 percent to 3.1 billion rupees.

For the full year, beverages made pre-tax profits of 8.6 billion rupees, up from 8.3 billion, plantations lost 430 million rupees, worsening from 106 million rupees.

Telecoms lost 587 million rupees, a little down from 691 million a year earlier and financial services made profits of 252 million rupees, up from 187 million and diversified made profits of 626 million up from 549 million.

Sri Lanka dockyard seeks to diversify away from offshore vessels

ECONOMYNEXT – Colombo Dockyard is looking to diversify away from making offshore support vessels (OSVs) for the petroleum industry and build other types of vessels like passenger craft given the prolonged slump in oil prices, its chairman has said.

“We have already received several inquiries from adjacent countries in connection to the assembly of passenger boats, barges and other vessels unrelated to oil drilling and OSVs,” Toru Takehara said.

Colombo Dockyard has in recent years specialised in the manufacture of offshore support vessels catering to the oil industry and in oil drilling and exploration operations in particular.

“Given the performance of oil prices, which dropped to historic lows in 2015, demand for OSVs has negatively affected our performance,” Takehara told shareholders in the firm’s annual report.

The ship yard industry performance is currently linked very strongly to the performance of oil markets and oil prices will stay at reduced levels over the short-medium term horizon, he said.

The yard reported a loss last year after Singaporean clients serving the oil industry cancelled one OSV and negotiated reduced prices for three remaining vessels to be delivered.

Sri Lanka Access Engineering March net almost stagnant

ECONOMYNEXT – Sri Lanka’s Access Engineering group’s March 2016 quarter net profit went up 1.5% to 642 million rupees from a year ago with most of the growth coming from the core construction business and also the Sathosa Motors subsidiary.

Sales fell 2.4% to 4.56 billion rupees during the period, according to interim results filed with the stock exchange.

March quarter earnings per share were 64 cents.

EPS in the year ending 31 March 2016 was 2.47 rupees with net profit up 5.3% to 2.5 billion rupees from the year before while sales rose 6.9% to 17.7 billion rupees.

Stock market analysts said Norges Bank, Norway’s central bank which manages the government pension fund, one of the largest sovereign wealth funds, had increased its stake in Access to 21.4 million shares or a 2.1% stake.

JKH Chief welcomes Govt.’s thrust for PPPs

• Says move will give rise to opportunities for Group given strong balance sheet

Premier blue chip John Keells Holdings Chairman Susantha Ratnayake has welcomed the Government’s thrust on Public-Private Partnerships and the policy decision will widen opportunities for the Group.

“The economic policy pronouncements of the Government signalled its desire to encourage public-private-partnerships and exit investments  in non-core public owned interests and this, we believe, will give rise to opportunities for the Group, given our strong balance sheet,” JKH Chairman Ratnayake has said in his review in the company’s FY2016 Annual Report released yesterday.

“The Group is currently evaluating significant investment opportunities across its industry groups,” he said.

“We are confident that investments which we are making today in pursuing a sustainable long-term future will result in improved returns on our capital employed in the medium to long term,” Ratnayake added.

JKH, according to Ratnayake, despite facing a challenging operating environment in FY2016, posted satisfactory underlying business performance.

During the financial year ended 31 March 2016, JKH Group posted a revenue of Rs. 93 billion, up by 2% and a Group profit before tax of Rs. 19.12 billion, up by 3% from the previous year.

JKH’s bottom line was down 2% to Rs. 14 billion. However, recurring profit attributable to equity holders of the parent rose by 5%to Rs.13.85billion. JKH Group was employing 19,522 people up from 18,981 a year earlier.

Ratnayake said that from a portfolio and diversificationperspective, the investments in JKH’s ConsumerFoods and Retail businesses have borne fruit,contributing towards a diverse stream of cashflows and a more balanced portfolio, where anincreasingly higher proportion of profits aregenerated from businesses with significantlong-term growth potential.

This year’s Report of JKH has been prepared in conformance with the Integrated Reporting Framework of the International Integrated Reporting Council which focuses on the reporting of the Group’s value creation process.

During FY2016, JKH’s Leisure industry group reported revenues, including share of revenues from associated companies, of Rs.24.31 billion and a PAT of Rs.4.37 billion, contributing 23% and 28% to Group revenue and PAT respectively. The industry group continued to maintain its position as the largest contributor to Group PAT.

The Transportation industry group reported revenues, including the share of revenues from the associate companies, of Rs.16.83 billion and a PAT of Rs.2.45 billion, contributing 16% each to Group revenue and PAT respectively.

The Property industry group reported revenues of Rs.4.34 billion and a PAT of Rs.1.59 billion, contributing 4% and 10% to Group revenue and PAT respectively.

The Consumer Foods and Retail industry group recorded revenues of Rs.36.46 billion and a PAT of Rs.3.23 billion, contributing 35% and 20% to Group revenue and PAT respectively.

The Financial Services industry group recorded revenues, including the share of revenues from associate companies, of Rs.11.90 billion and a PAT of Rs.1.72 billion, contributing 11% each to Group revenue and PAT.

The Information Technology industry group recorded revenues of Rs.8.26 billion and a PAT of Rs.96 million, contributing 8% and 1% to Group revenue and PAT respectively.

The Plantation Services sector recorded revenues of Rs.2.42 billion, contributing 2% to Group revenue, and a PAT of Rs.6 million.

JKH’s total shareholder return (TSR) in 2015/2016 was a negative 12.2%.

Its Board declared a final dividend of Rs.1.50 per share to be paid on 13June. The first and second interim dividends for the year were Rs.4.50 per share and Rs.1.00 per share respectively. The first interim dividend included a special dividend of Rs.3.50 per share on account of the cash inflow of Rs.4.14 billion to the company from the share repurchase made by Union Assurance PLC.

Accordingly, the total pay-out in the year under review was Rs.8.04 billion compared to Rs.3.48 billion in the previous financial year.
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Aitken Spence FY16 pre-tax profit down 33% to Rs. 3.8 b

• Challenging year sees bottom line dip 43% to Rs. 2 b; Group revenue down 25% to Rs. 26 b
• Optimistic on future, invests Rs. 12.8 b in new ventures and capital assets

Aitken Spence Plc yesterday reported lower performance in FY2016 owing to challenging times in comparison to a year earlier.

Group revenue was down by 25% to Rs. 26 billion whilst pre-tax profit was lower by 33% to Rs. 3.8 billion. Net profit attributable to equity holders was down 43% to Rs. 2 billion.

“The past year has been a challenging one for the group, attributable to a number of factors including the cessation of the power agreement with the CEB, a slowdown in the national economy, disappointing performance in the Maldivian hotel sector and foreign exchange losses in a number of overseas investments,” Aitken Spence Chairman D.H.S. Jayawardena was quoted as saying in a company statement.

“However, we have proactively positioned ourselves for exponential growth in the medium and long term through strategic investments,” he added.

The statement said the conglomerate followed through on its strategy of investing in the medium and long term future amidst a challenging operational climate, by investing Rs. 10 billion on new ventures both local and overseas and a further Rs. 2.8 billion on property, plant and equipment.

The tourism sector recorded a growth of 1.9% in revenue to Rs. 17.2 b, while the Maritime and Logistics, and Services sectors reported revenues of Rs. 8 b and Rs. 1.1 b respectively, which grew by 6.9% and 5.5% respectively over the year. The Strategic Investments sector revenue dropped mainly due to the cessation of the power purchase agreement of the 100MW thermal power plant at Embilipitiya.

Aitken Spence PLC reported a profit attributable to shareholders of Rs. 2.03 b while earnings per share stood at Rs. 4.99.

The focus on meeting the tourism boom in the country has marked a theme for the year’s operations. The Group unveiled its newest hospitality offering – Heritance Negombo, an iconic 139-room property in the heart of the coastal city. Furthermore, the Sands Kalutara, was refurbished and rebranded as Turyaa Kalutara with an expansion of 90 rooms while the existing 110 rooms were upgraded and refurbished in order to command a strong position in the 4-Star plus segment.

Aitken Spence Hotels also became the first Sri Lankan hotel company to purchase a hotel in the Middle East with its acquisition of Al Falaj, the popular four-star hotel in Oman’s capital, Muscat.

During the previous financial year and the beginning of this financial year the Group invested on two new islands – Aarah and Raafushi. Construction has begun on a 150-roomed five star property on Aarah, which is due for launch in winter 2017, while plans are being finalised for a resort on Raafushi. The acquisitions will further strengthen the Group’s presence in the Maldives, where Aitken Spence is presently the largest international hotel operator with four renowned properties.

Aitken Spence Travels followed suit achieving a landmark 129,000 arrivals, the highest inbound volume handled by a single operator, an optimistic upturn for the group’s future focus on the sector and ‘Destination Sri Lanka’ at large.

“We are approaching a momentous milestone of completing 150 years in business since the formalised beginnings of the group. We have succeeded in staying relevant and agile throughout the decades, while transforming ourselves to meet the challenges of the macro environment. Throughout our entrepreneurial journey, our priority has been to maintain sustainability and responsibility in all of our practices. In light of the challenging operating environment we are experiencing at present, we have adopted a lean management style and made key investments for the medium and long term future. I’m optimistic about the future that we invest continuously in,” said Aitken Spence Deputy Chairman and Managing Director J.M.S. Brito

Aitken Spence invested approximately $ 16 million to acquire a 20% equity stake in Fiji Ports Corporation Limited, the regulator of the ports sector in Fiji and the owner of the infrastructure of all major ports in Fiji.

Listed in the Colombo Stock Exchange since 1983, Aitken Spence is a blue chip conglomerate with a strong regional presence in the Hotels, Travels, Maritime Services, Logistic Solutions, Plantations, Power Generation, Financial Outsourcing, Insurance, IT, Printing and Apparel sectors.
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Sri Lanka signs MOU with Siemens to develop Megapolis smart cities

(LBO) – Siemens, a German electronics and industrial conglomerate, has signed a memorandum of understanding with the Megapolis Ministry to offer sustainable, smart city solutions for Sri Lanka.

“We are extremely happy to partner with Siemens whose expertise and technologies will contribute to the Western Province’s intensive efforts to eliminate congestion pressures on urban infrastructure, services and environment with a focus on reducing the per unit capital cost of infrastructure,” Lakshman Jayasekara, project director, Western Region Megapolis Planning Project, said in a statement.

The prime objective of the Ministry of Megapolis and Western Development is to bring systematic changes and development processes into the urban community in Sri Lanka, which will ensure that the inhabitants of urban areas become a part of socio-economic development of the country while maintaining high levels in quality of life.

“This will pave the way for making Sri Lanka a commercial, naval and aviation hub of Asia,” the statement said.

“In this context the ministry envisages transforming the entire Western Province into a Megapolis area to usher in comprehensive development within the next five years.”

The scope of work under the Ministry’s purview would primarily include macro level planning of the Western Megapolis region based on bio-geo-physical and socio-economic aspects.

The statement says that further to design smart urban settlements in strategic locations of the country it will also seek to discover solutions to resolve distinctive issues related to urbanization such as garbage, slums, energy, traffic, environment and livelihoods.

“Siemens is delighted to partner with the Government of Sri Lanka and the Ministry of Megapolis and Western Development in its endeavour to achieve the status of a ‘high income developed nation,’” Sunil Mathur, managing director and CEO, Siemens limited India, said.

“With its global expertise, Siemens has the portfolio, the know-how, and the expertise to help cities become more liveable, more competitive and more sustainable. This will enable the national economy to leverage the benefits of economies of agglomeration brought about by urbanization.”

The Ministry plans to develop new cities in Bandaragama, Kadawatha, Kottawa and Kerawalapitiya surrounding the outer circular that will be soon under construction as a part of the Megapolis development plan.

Globally, Siemens is a leader in providing technology solutions for setting up intelligent (smart), sustainable cities. With solutions for Smart Grid, Building Technologies, Mobility and Power Distribution, Siemens has successfully set up smart cities in Vienna and New York, and is already involved in the Restructured Accelerated Power Development and Reforms Program (R-APDRP) of the Government of India for installing Smart Grid solutions in multiple cities in India.

The MoU was signed by Lakshman Jayasekara and Anirudh Tandon, Country Manager, Siemens Limited Sri Lanka.

Lanka Tiles March quarter net down 42-pct

ECONOMYNEXT – Sri Lankan floor tile maker Lanka Tiles said March 2016 quarter net profit fell 42% to 177 million rupees from a year ago with local sales down slightly.

Total sales fell four percent to 1.5 billion rupees in the quarter, according to interim accounts filed with the stock exchange.

The company’s tax charge for the quarter doubled to 221 million rupees from the previous year.

March 2016 earnings per share were 3.34 rupees. EPS for the year ending 31 March 2016 were 22.28 rupees with net profit up 41% to 1.2 billion rupees and sales up three percent to 6.1 billion rupees.

Annual export sales were down 20%, the accounts showed.

Sri Lanka's Ceylon Cold Stores in US$20mn expansion

ECONOMYNEXT - Ceylon Cold Stores Plc, a unit of Sri Lanka's John Keells Holdings, which owns the Elephant House ice cream brand said it started a 3.0 billion rupee (20 million US dollar) factory to expand capacity.

The expansion will be at the Seethawaka industrial zone, Jit Guneratne told EconomyNext. Its existing factory is at Ranala, in the Colombo district.

"In the Frozen Confectionery segment, production of the impulse range of products is near maximum capacity," Chairman Susanthe Ratnayake told shareholders.

Ceylon Cold Stores also owns the Elephant House soft drinks brand.

The firm has 18 flavours of drinks and 32 flavours of ice cream.

In 2015 beverage sales rose 26 percent and ice cream revenues rose 21 percent, Ratnayake said.

Sri Lanka's new administration raised state sector salaries and printed money to keep interest rates artificially low and the budget deficit expanded, expanding demand and pushing the country into a balance of payments crisis.

Growth is expected to be moderate in 2016 as an International Monetary Fund backed stabilization program and currency depreciation undermines people's income.

Falling international commodity prices in the wake of tighter US monetary policy has however dampened overall inflation in Sri Lanka.

Sri Lankan shares end at one-month closing low; higher rates weigh

Reuters: Sri Lankan shares fell to a near one-month low on Monday as investors sold large cap stocks on sentiment dented by a lack of catalysts for buying risky assets, amid concerns over foreign outflows and rising interest rates.

The benchmark Colombo stock index ended 0.28 percent, or 18.36 points, weaker at 6,552.85, its lowest close since April 29. It fell 0.94 percent during last week.

"The sentiment is very weak. All are waiting for some catalysts like a big foreign direct investment or IMF loan inflow or a big IPO," said Prashan Fernando, chief operating officer at Acuity stockbrokers.

Yields on treasury bills edged up by between 5 and 27 basis points to near three-year highs at a weekly auction last Wednesday, despite the central bank leaving key policy rates steady for a third straight month.

Foreign investors net sold 66.6 million rupees ($452,446) worth of shares on Monday, extending the year-to-date net foreign outflow to 5.64 billion rupees worth of shares.

Turnover stood at 740.2 million rupees, lower than this year's daily average of around 795.9 million rupees.

Shares in top conglomerate John Keells Holdings, ended steady while those in Distilleries Company of Sri Lanka edged down 0.2 percent. The two stocks collectively accounted for 72 percent of the day's turnover.

Shares in Ceylon Tobacco Company Plc fell 1.78 percent, while those in Sri Lanka Telecom Plc dropped 2.68 percent and Commercial Bank of Ceylon Plc fell 0.77 percent, dragging the overall index down.

($1 = 147.2000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Anupama Dwivedi)

Sri Lanka’s MTD Walkers losses up on rising costs

May 30, 2016 (LBO) – Sri Lanka’s infrastructure solutions provider MTD Walkers posted losses of 266 million rupees in the March 2016 quarter, up 333 percent from a year earlier, amid engineering segment losses with rising sales and finance costs, interim accounts showed.

The troubled firm reported losses of 1.59 rupees per share against the 48 cents loss per share reported a year ago.

Revenues rose 55 percent to 4.6 billion rupees and cost of sales rose at a faster 101 percent to 4.0 billion rupees, making 611 million rupees gross margin, a 39 percent drop against a year earlier.

Other income turned to a positive figure of 5.2 million rupees from a negative figure of 5.0 million rupees last year.

Finance cost rose 135 percent to 408 million rupees in the March quarter resulting in a 314 million rupees loss in net finance income.

In the twelve months to March, the firm lost 531 million rupees, against a 765 million rupees profit reported a year ago.

A segment analysis for the 12 months showed profit of the group’s main civil engineering sector falling.

The profit from civil engineering fell from 1.6 billion rupees to 446 million rupees in the twelve months while the engineering segment loss further increased to 312 million rupees from 94 million rupees.

The marine engineering sector reported a loss of 1.3 billion rupees while trading business reporting a 93 million rupees loss.

Debt to equity ratio stood at 190.36 percent in 2016 compared to 126.30 percent reported in 2015.

By the end of 2016 financial year there were 2,357 public shareholders holding 9.22 percent of company shares.

Vehicle importers claim tax calculations irrational

Vehicle importers have urged the Government to reconsider the increase in the Unit Rate Tax on the basis that calculations were irrational, resulting in prices of some vehicles soaring by as much as 60 percent.

Two of the leading vehicle importers associations said the move to increase the tax would have a severe impact on the vehicle industry and those planning to buy vehicles. The Ceylon Motor Traders Association (CMTA) said the increase in the Unit Rate Tax would mean the payment of tax based on the cubic capacity of the engines, a system that was agreed upon by the trade as an interim measure and not as a permanent solution to sort out the issue of undervaluation of vehicles.

“We believe that the auto trade should not be made to pay for the inefficiencies and the mistrust amongst government officials by making our businesses nonviable,” the Association said. It said the new rates virtually prohibited vehicle imports in some segments and the import duty itself could increase ranging from Rs. 200,000 to Rs. 15-20 million a unit, depending on the vehicle type.

The Vehicle Importers Association of Lanka said a number of people who had opened Letters of Credit also would be affected by the sudden increase in the Unit Rate Duty. The Association’s President Sampath Merinchchige said the Government should provide a concession for people who had already opened LCs.

If undervaluation was a problem, the Customs should work out a mechanism to overcome it, he said. A senior Finance Ministry official said the decision to revise the duty on vehicles from Friday was a fresh attempt to prevent undervaluation of vehicles and save foreign exchange by reducing imports.

He said previous attempts to prevent undervaluation had not been successful and therefore the ministry had decided on this Unit Rate System. The official said that after Finance Minister Ravi Karunanayake returned from Japan, the Government might consider providing some relief to those who had already opened LCs.

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Hilton reports Rs. 55 mln profit

State-owned Hotel Developers PLC (HDEV), the owning company of Colombo Hilton, has made a Rs. 55 million net profit for 1Q2016, against the loss of Rs. 35 million for the corresponding period of last year, its results show. The company has commenced a major refurbishment of the hotel from October 2014 which will see improvements in the property including rooms, food and beverage outlets and meeting spaces. “This programme is budgeted at US$35 million and will be financed by a USD loan amounting to $27 million and the balance from internally generated funds of $8 million,” the company has said. Government officials have said that preparations are underway to seek a buyer for the government stake in the entity.
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Sri Lanka cuts tax on smaller electric cars, Tesla EV prices to soar

ECONOMYNEXT - Sri Lanka has cut taxes on popular mid-sized electric cars from 2.7 million to about 1.7 million rupees and sharply raised levies on luxury larger brands such as Tesla, which are expected to go up steeply in price.

The price of the Nissan Leaf, Sri Lanka's most popular electric cars is expected to come down by about a million rupees.

However luxury Tesla models are expected to go up steeply under a sharply progressive tax system.

Under new tax rates announced this week, electric cars with a motor of less than 50kiloWatt will be charged 15,000 rupees per kW and those up to 100kW, 25,000 rupees.

Cars of between 100 and 200 kW will be charged 35,000 per kilowatt and those above 200 kW will be charged 45,000 rupees per kW.

A Tesla Model S with a motor of at least 270kW will now be charged taxes of 12.1 million rupees. The street value of the car is expected to top 20 million rupees, motor trade officials said.



Sri Lanka had an interventionist policy of charging very high rates of taxes from motor cycles, three-wheelers and small motor cars and charging low rates of taxes from electric cars.

Under the new rates announced this week, cars with hybrid and reciprocal engines are also taxed not simply on a non-discriminatory proportionate basis but under a sharply progressive system from this week, based on engine capacity.

In Sri Lanka the elected ruling cars pay no tax on their cars and state workers also get tax slashed cars while the ordinary citizens are squeezed with high taxes in the style of a neo-serfdom re-established after the end of British rule.

Under British rule both slavery and serfdom were abolished.

Sri Lanka Hemas March net down, annual profit up 38-pct

ECONOMYNEXT – Sri Lanka’s Hemas Holdings March 2016 quarter net profit fell 3.5% to 744 million rupees from a year ago with sharp increases seen in administrative expenses and finance costs.

Hemas group sales went up 9.4% to 9.7 billion rupees in the period, interim results ffiled with the stock exchange showed.

Diluted earnings per share were 1.32 rupees for the quarter. In the year to 31 March 2016 EPS was 4.71 rupees with net profit up 38% to 2.7 billion rupees while sales grew 17% to almost 38 billion rupees.

Hemas Holdings Chief Executive Steven Enderby said the group earned an additional interest income of 280 million during the year from investing the proceeds of the rights issue.

“We continue to focus on driving growth from our core Consumer and Healthcare businesses while seeking continuous innovation, and strong profitability for the year ahead,” he said.

Hemas group FMCG sector total annual revenues grew 20% to 14.3 billion rupees from the year before with earnings up 37.2% to 1.4 billion rupees.

“The strong performance was underpinned by our Bangladesh operation maintaining excellent revenue and profit growth, as well as strong sales across all our major brands in the domestic market,” Enderby said.

Hemas also benefitted from relatively weak commodity prices for key raw material inputs.

Group healthcare sector revenue for the twelve months rose 16% to 16.1 billion rupees with earnings up 22.8%.

Enderby said Hemas unit JL Morison earnings grew 43.4% for the twelve months ended March 31, 2016.

“Revenue growth was largely driven by the increase in sales from the buyback arrangement with Government of Sri Lanka and sales growth in key diagnostics agencies,” he said.

“The significant growth in operating profit resulted from increases in revenues in both consumer/OTC products and pharmaceuticals segments, efficiency and capacity gains at the plant, after a period of closure of the plant in Q1 2014/15 and a restructured distribution network.”

Hemas group leisure business made a loss during the year although sales grew 13% to 3.4 billion rupees.

“Our newest property, the luxury hotel Anantara Peace Haven Tangalle Resort, opened in December, finished its first operating quarter with an encouraging performance,” Enderby said.

Serendib Hotels posted a revenue growth of 12.2%, driven by strong performance from the popular Dolphin Hotel which recorded year-round occupancy of 83%.

Transportation sector revenue grew 17% to 1.8 billion rupees.

This was driven by “higher volumes through domestic logistics operations with warehouses operating at high levels of capacity, higher volume throughput at our container depot and new 3PL customers, specifically Hemas Logistics which was able to secure a warehouse and distribution agreement for Sathosa,” Enderby said.

“With subdued revenue growth from the aviation segment, the transportation sector registered an operating profit of 500 million rupees, a growth of 10.7% over the previous year.”

Japan to give budget support to Sri Lanka; loan US340mn for power and water

ECONOMYNEXT - Japan fund a 38 billion yen (340 million dollar) expansion of Sri Lanka's power and water supply system and also provide a budget support loan, a statement following a meeting with President Maithripala Sirisena and Prime Minister Shinzo Abe said.

The power loan will be used to construct transmission lines in Sri Lanka's former war torn Eastern Province and the North Central Province, the home district of President Sirisena.

A transmission line to carry power from planned power plants in Sri Lanka's Eastern Province to the capital will also be provided.

In addition to the 38 billion yen project loan a budget support loan "which supports policy and institutional reform in macro-economic and public financial management, as well as the promotion of the private sector," will be provided. The loan amount was not disclosed.

Sri Lanka was expected to get several budget support loans from the World Bank, Asian Development Bank, Japan and Korea in tandem with a deal with the International Monetary Fund to fix the islands' finances which were damaged in a January 2015 revised budget.

Sri Lanka Laugfs March net down 74-pct

ECONOMYNEXT – Sri Lankan liquid petroleum gas supplier Laugfs Gas said March 2016 quarter net profit fell 74% to 97 million rupees from a year ago as costs rose sharply.

Sales rose 42% to 3.9 billion rupees in the quarter, according to interim accounts filed with the stock exchange.

The accounts showed sharp increase in selling and distribution sxpenses and administrative expenses and finance costs.

Earnings per share for the March 2016 quarter were 25 cents.

Laugfs Gas EPS for the year ended 31 March 2016 was 3.32 rupees with net profit down 11% to 1.3 billion rupees while sales rose 15% to 13.3 billion rupees.

The accounts showed profits from its energy sector of Laugfs Gas fell during the year while the power business profits rose sharply as did proftts from transportation and logistics.

The group’s leisure sector losses reduced during the year but property development business losses rose.

Sri Lanka's Kelani Valley expands to cinnamon as tea loses shine

ECONOMYNEXT - Kelani Valley Plantations, a unit of Sri Lanka's Hayleys group said it is expanding into cinnamon cultivation as tea and rubber prices fall.

Kelani Valley Chairman Mohan Pandithage told shareholders that the firm had invested 43 million rupees to grow cinnamon in 58 hectares out of which 33 was in Kitulgala.

Kelani Valley was until the mid-1990 state-owned and the sector was a burden to the ordinary people with their taxes being used to pay salaries, until it was privatized.

Along with other privatized planations it started paying lease rentals and taxes to the Treasury.

Pandithage said the company was developing Oliphant Bungalow in Nuwara Eliya into a plantation boutique hotel.

Hayleys Global Beverages (Pvt) Ltd, which will make value added teas for export is expected to start operations in 2016. Pandithage said Mabroc Teas (Pvt) Ltd, a branded tea marketer also made a profit.

The firm was also perusing direct exports of rubber.

Global commodity prices are falling as the US Federal Reserve tightened monetary policy sending the dollar up and pushing down prices of oil, gold, metals and food commodities.

Countries like Russia, which depend on oil exports, also printed money and saw their currencies collapse.

Countries like Saudi Arabia and UAE which do not follow active monetary policy but mimic US interest rates, have maintained their strongly pegged exchange rates.

Sri Lankan shares end steady; higher rates weigh

Reuters: Sri Lankan shares ended steady on Friday as gains led by consumer shares were offset by losses in the telecom stocks amid investor sentiment dented by foreign outflow and rising interest rates.

Yields on treasury bills edged up by between 5 and 27 basis points to near three-year highs at a weekly auction on Wednesday despite the central bank left key policy rates steady for a third straight month.

The benchmark stock index ended up 0.04 percent, or 2.45 points, at 6,571.21, recovering from its lowest close since April 29 hit on Thursday, and posting a fall of 0.94 percent this week.

"The retail and high-net-worth investors are concerned on the rising interest rates. Until the IMF money comes in, the market will be volatile," said Dimantha Mathew, head of research of First Capital Equities (Pvt) Ltd.

"Foreign selling continued and it is worrying the investors."

Foreign investors net sold 657 million rupees ($4.49 million) worth of shares on Friday, extending the year-to-date net foreign outflow to 5.57 billion rupees worth of shares.

Turnover stood at 1.08 billion rupees, the highest since May 19 and well above this year's daily average of around 796.6 million rupees.

Shares in Ceylon Tobacco Company Plc climbed 1.82 percent while Dialog Axiata Plc slipped 1.8 percent.

($1 = 146.4300 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sherry Jacob-Phillips)

SL Funds: Equity Unit Trusts now outperform market, says Guardian Acuity

There’s good news in fund management. Most of the professionally managed funds that invest in the Colombo market tend to outperform the market.

In 2014, for instance, the Guardian Acuity Equity Fund, gave a return of 37.9 percent, compared with the All Share Price Index (ASPI) which rallied 23.4 percent.

Sri Lankan equity funds, or open-ended growth funds, outdid the market in 2012 and 2013 as well. They gave returns of between 8.2 and 15.86 percent annually, although some didn’t do so well.

Even in 2015, which wasn’t a good year for stocks, Guardian Acuity gave a return of 2.5 percent, when the S&P Sri Lanka 20 index plunged 11.33 percent.

For investors who want higher returns linked to Sri Lanka’s emerging market, equity Unit Trusts offer an attractive proposition. But outperforming the market isn’t the only criterion for evaluating a fund.

Lanka Business Online, which plans a series of articles on Sri Lankan Unit Trusts, spoke to the fund managers at Guardian Acuity to get their insights.

Similar to mutual funds in the U.S., the Sri Lankan variety gives investors tax-free returns. Foreign investors can invest as well.

But picking an equity fund is a bit like picking a stock. An investor should have good timing, be willing to ride the waves, and in Sri Lanka, take a three to four year view.

“We encourage investors to take a three to four year view rather than look for short-term returns,” said Ruvini Fernando, the joint CEO of Guardian Acuity Asset Management. She highlighted that steady long-term returns is a good option within this asset class.

After the end of a war with Tamil Tiger separatists in 2009, Sri Lanka is showing strong growth, with some sectors such as tourism booming. Many Sri Lankan companies offer attractive ROEs, but it generally takes a fund manager to extract those returns.

Since the fund launched in 2012, the 410 million rupee Guardian Acuity Equity Fund has given a 65.5 percent absolute return as of April 2016. In comparison, the All Share Price Index has grown by 18.9 percent.

In annualized terms, the fund has given a return of 12.8 percent, compared with a 4.25 percent annualized return on the All Share Price Index during this period.

Equity funds in Sri Lanka have to compete with government securities which often crowd out the private sector. One-year treasury bills at the beginning of 2012 yielded 9.3 percent, which rose to 11.38 percent at the beginning of 2013. They ranged around 6-7 percent for most of 2014 and 2015 and currently yield 10.3 percent.

Risk-free Treasury bills, which are an important benchmark for Unit Trusts in Sri Lanka, should experience a structural adjustment downwards as alternative instruments are better priced.

Share owning democracy

Although the current Sri Lankan government has promoted share ownership to the public, it seems individual investors would be better off investing via an equity fund.

“A share owning democracy is a great idea, but the way people can manage risks and volatility better is by using an instrument like a unit trust,” she said.

This is because they often don’t have the time to monitor, react to market developments and pour over research.

“If you are a professional and you want to access capital markets, be it securitizations or commercial paper, or stocks and bonds, there are fund managers who will dedicate their time to doing that for you,” she said.



Regulated by Sri Lanka’s Securities and Exchange Commission, investors get the benefit of diversification and liquidity to extract funds.

The tax free returns, when grossed up, compare well against bank fixed deposits, said Asanka Jayasekara, a fund manager at Guardian Fund Management.

If the corporate tax rate is 28 percent, a 10 percent yield when grossed up increases to around 13.8 percent.

A good pedigree is important too, and the parent companies of Guardian Acuity are blue-chip Carson Cumberbatch, HNB and DFCC Bank.

Guardian Acuity discloses its top five stock allocations monthly, which are currently Distilleries, Sampath Bank, Seylan Bank, Dialog Axiata and Aitken Spence Hotel Holdings.

Fernando said they disclose a lot more information such as fund allocations and credit quality of investments than required to by Sri Lanka’s SEC. Some of the better managed Unit Trusts follow the same practice, she said.

For investors who want predictable returns over a short-term horizon, Guardian Acuity has a Money Market Gilt Fund, with 410 million rupees under management, and a Money Market Fund with 4.5 billion rupees under management.

The Money Market Gilt fund sticks to treasury bills and repurchase agreements, and the Money Market Fund diversifies into fixed deposits, government securities and commercial paper.

“We have an emphasis on quality. We make sure all investments are investment grade and above. We don’t rely on the ratings alone, but have an internal research team dedicated to analyzing companies, cash flows and balance sheets,” Sumith Perera, senior fund manager at Guardian Acuity Asset Management, said.

Over 70 unit trusts are regulated in Sri Lanka and registered with the Unit Trust Association of Sri Lanka (utasl.lk) under categories such as open-ended income funds, index funds, balanced funds, shariah funds, IPO funds and gilt and money market funds. Analysts say closer public scrutiny is needed to highlight the strong performers as well as the under-performers in the industry.

Sri Lanka ups taxes on larger cars, SUVs up by two million

ECONOMYNEXT - Sri Lanka has cut taxes on small cars with engines capacity below 1,000 cubic centimetres but upped taxes on larger cars, motor trade officials said.

A Nissan X-Trail were taxes were earlier about 4.6 million rupees had gone up to 7.9 million which may push the street price to 10 to 11 million rupees, an importer said.

The tax on an Outlander which was about 5.4 million had now gone to 7.96 million rupees. The retail price may move close to 13 million, sources said.

A mid-sized Axio hybrid which had a tax of about 2.8 million would now draw a tax of 29.8 million rupees taking the retail price to around 6.4/6.5 million. The prices of Aqua and Fit cars will also go up.

The taxes on a Wagon-R which was about 1.5 to 1.6 million would now come down to about 1.35 million, sources said.

However auction prices in Japan had already started to move up on small cars.

The auction prices on larger cars can also come down, when import demand falls.

Secondary market price tax free permits of the elected ruling class and state workers will also go up, giving them more tax-arbitrage profits.

A permit which a member of parliament could sell at about 20 million rupees up to yesterday, may now go up to about 30 million or more depriving tax to the state said, firm prices are not yet available.

Sri Lanka sells Rs47.7bn in 2 to 10 year bonds, yields up

ECONOMYNEXT - Sri Lanka has sold 47.7 billion rupees of 2 to 10 year bonds accepting near announced volumes in all maturities with yields edging up, data released by the state debt office showed.

The debt office sold 12.86 billion rupees of 2-year 4-month bonds maturing on 15.10.2018 to yield 11.83 percent after offering securities worth 10 billion rupees, 11.6 billion rupees of 5-year 4-month bonds maturing on 15.10.2021 to yield 12.48 percent after offering 15.0 billion.

On May 19, 15.11.2018 bonds were sold at 11.75 percent.

It also sold 14.1 billion rupees of 7-year 7-month bonds maturing on 01.01.2024 to yield 12.77 percent (up 37 basis points from May 19), after offering 12.0 billion and 8.1 billion rupees of 10 year bonds maturing on 01.06.2026 to yield 12.98 percent (up 16bp from May 19) after offering 8.1 billion rupees.

On May 10, 01.01.2024 bonds were sold at an average yield of 12.40 percent and 01.06.2026 bonds were sold at 12.82 percent.

The bonds have a settlement date of 01 June 2016.

Ceylinco to settle all flood claims by June 3

Ceylinco Insurance will settle all claims of flood victims on or before June 3.The sum is expected to be in the excess of Rs. 1.6 billion.

Ceylinco General Insurance Chief Executive Officer Ajith Gunawardane said they have received over 2,000 claims which include 800 for motor vehicles and around 1,200 for property which also include factories and other business establishments. “We have all ready paid ove Rs. 425 million so far.”

Gunawardane said that they will look at the issue from a humanitarian angle as they did for the 2004 tsunami. “If any of our customers are affected and have

made a claim we will settle it 100%. We have gone a step further and have decided to pay a percentage to other damages sustained by our customers.” If a person has taken car insurance and his property or business was not insured Ceylinco Insurance will pay a percentage of that damage as well.” Gunawardane said Ceylinco has also taken a decision to pay a percentage of damage to community centers that also include places of religious, health and others who are never insured.

The company has made huge profits and we are ready to give them back to

people who need it now. “We have now appointed a special task force for this.”

He recalled that during the tsunami too Ceylinco paid the highest claims in

the Sri Lanka history to the tune of Rs. 4 billion.

Meanwhile an official from Sri Lanka Insurance said they too received claims to the value of over Rs. 1.5 billion. “We will start paying them from Friday.”

www.dailynews.lk

Sunshine packaging arm to expand with US$ 2 mn

Sunshine Packaging Lanka is poised for further expansion following the receipt of US$ 2 million in Foreign Direct Investment (FDI) from Primeco Holdings Limited , a conglomerate incorporated in Hong Kong.

The FDI infusion is via an issue of new shares amounting to a 40% stake in Sunshine Packaging by Primeco Holdings which has interests in steel, coal and other commodities.

The funds from the new investment will be used for further enhancement and expansion of the operations of Sunshine Packaging – which at present manufactures tea caddies, confectionary tins and printed tin sheets. With the new investment, Sunshine Packaging expects to step up its focus on the lucrative export market and significantly increase its business volumes – particularly by expanding its international orders via the partnership with Primeco Holdings.

“The investment from Primeco Holdings reflects the strong confidence of international investors in the companies of the Sunshine Holdings Group,” Sunshine Holdings Group Managing Director Vish Govindasamy said.
www.dailynews.lk

Ceylinco Life’s Life Fund crosses Rs 70 billion in 28 years

Ceylinco Life said the company’s Life Fund crossed Rs 70 billion at end April 2016, making it the only local life insurer to achieve the feat in 28 years.

The Life Fund had grown by Rs 2.75 billion in four months, enabling it to become the fastest to cross Rs 70 billion in Sri Lanka.

“This is an important milestone for the company because the size of the life fund is one of the key benchmarks for the financial strength of a life insurance company,” Ceylinco Life Managing Director and CEO R. Renganathan said.

Ceylinco Life also reported that total assets of the company had grown by 4.3 per cent since December 2015 to Rs 83.6 billion at the end of April and that its investment portfolio had increased by Rs 2.57 billion over the four months.

“The quality of our investments has always reinforced our operational strength, as represented by the premium income of the company,” Renganathan said disclosing that investment income for the first four months of 2016 had exceeded Rs 2.49 billion.

The company’s investment portfolio at 30th April 2016 comprised of Government Securities (62 per cent); Licensed Private Banks (7 per cent); State Banks (1 per cent); Real Estate (8 per cent); Corporate Debt (21 per cent) and Other Investments (1 per cent).

These investments are made in conformity with the investment guidelines stipulated under the Regulation of the Insurance Industry Act No 43 of 2000 and are subject to regular monitoring by the Insurance Board of Sri Lanka (IBSL).

Ceylinco Life commenced operations in January 1988 and has been the market leader in Sri Lanka’s life insurance industry for 12 consecutive years since 2004. The company has close to a million lives covered by active policies and is acknowledged as the benchmark for innovation in the local insurance industry for its work in product research and development, customer service, professional development and corporate social responsibility.

www.dailynews.lk

Hemas Holdings posts Rs 4 bn profit for 2015-16

Hemas Holdings PLC (HHL) and its subsidiaries achieved consolidated revenues of Rs.37.9 bn, a year-on-year (YoY) growth of 16.9% for the twelve months ended March 31, 2016.

During this period operating profit reached Rs.4 bn and earnings Rs.2.7 bn, growth of 17.5% and 37.7% respectively. An additional interest income of Rs.280 mn was earned from investing the proceeds of the rights issue.

The FMCG sector achieved total revenues of Rs.14.3 bn for the twelve months, a 20.2% YoY increase over the previous financial year. Operating profits were Rs.1.8 bn, 50.5% YoY growth, whilst earnings grew at 37.2% to stand at Rs.1.4 bn. Strong performance was underpinned by our Bangladesh operation maintaining excellent revenue and profit growth, as well as strong sales across all our major brands in the domestic market and relatively weak commodity prices for key raw material inputs. Overall healthcare sector revenue for the twelve months under review stood at Rs.16.1 bn, a YoY increase of 16.0%, whilst earnings grew at 22.8%. During the year, Hemas Hospitals opened its first wellness centre at Orion City, three new laboratories and invested in building capabilities in the Urology specialty. Our hospitals growth in revenue contributed 34.7% of the overall segment’s revenue growth. Hemas pharmaceutical distribution operation registered a YoY topline growth of 8.2% maintaining its market leadership position. Our pharmaceutical sales growth continues to be driven by our strong presence in growing therapeutic segments.

JL Morison posted a YoY growth of 22.8% and earnings growth of 43.4% for the twelve months ended March 31, 2016. Revenue growth was largely driven by the increase in sales from the buyback arrangement with Government of Sri Lanka and sales growth in key diagnostics agencies.

The significant growth in operating profit resulted from increases in revenues in both consumer/OTC products and pharmaceutical segments, efficiency and capacity gains at the plant after a period of closure of the plant in Q1 2014/15 and a restructured distribution network. Transportation sector reported a revenue of Rs.1.8Bn, a 17.2% YoY topline growth. Revenue growth was driven by higher volumes through our domestic logistics operation with warehouses operating at high levels of capacity, higher volume throughput at our container depot and new 3PL customers,

www.dailynews,lk

Ceylon Cold Stores March net up 61-pct

ECONOMYNEXT - Ceylon Cold Stores said March 2016 quarter net profit rose 61% to 967 million rupees from a year ago as the firm benefitted from higher consumer spending as disposable incomes increased.

Sales grew 28% to 9.5 billion rupees during the quarter, interim accounts filed with the stock exchange showed.

Earnings per share for the period were 10.17 rupees, said the firm, part of the John Keells Holdings group.

In the year ended 31 March 2016, EPS was30.25 rupees with net profit up 88% to 2.9 billion rupees while sales rose 23% to 34 billion rupees.

Sri Lankan shares hit 4-wk closing low; rising rates weigh

Reuters: Sri Lankan shares closed at a four-week low in thin trade on Thursday, led by blue chips amid foreign investor outflow as investor sentiment took a hit on rising interest rates despite the central bank keeping key policy rates steady last week.

Yields on treasury bills edged up by between 5 and 27 basis points to near three-year highs at a weekly auction on Wednesday. The central bank left key policy rates steady for a third straight month.

The benchmark stock index fell 0.22 percent, or 14.73 points, to 6,568.76, its lowest close since April 29. It fell 1.12 percent last week, its first weekly fall in seven weeks.

"We expect negative trend to continue with the rising interest rates and also on the continued foreign outflow," said Dimantha Mathew, head of research of First Capital Equities (Pvt) Ltd.

"We expect the market to bounce back once the expected IMF and sovereign bond inflows come."

Foreign investors net sold 205.8 million rupees ($1.41 million) worth of shares on Thursday, extending the year to date net foreign outflow to 4.91 billion rupees worth of shares.

Turnover stood at 398.1 million rupees ($2.71 million), the lowest since March 26 and nearly half this year's daily average of around 797.8 million rupees.

Top conglomerate John Keells Holdings, which on Tuesday announced a share subdivision, fell 1.71 percent. Keells posted a 13 percent fall in March quarter earnings on Wednesday.

Shares in Sri Lanka Telecom Plc fell 0.73 percent while Cargills (Ceylon) Plc lost 3.13 percent, dragging down the overall index.

Concerns over a government move to increase the value added tax and impose new taxes effective May 2, which could hit the bottom line of many companies, also dented sentiment, analysts said. 

($1 = 146.9000 Sri Lankan rupees) 

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

Sri Lanka Blue Diamonds Jewellery audit reveals fraud: SEC

ECONOMYNEXT - Sri Lanka's Securities and Exchange Commission said an audit ordered of the books of Blue Diamonds Jewellery Worldwide Plc, has found possible misappropriation of public funds and capital market offences and offences under the penal code.

A statement said the SEC will conduct further investigations into the company and was taking all steps necessary to protect the interests of investors.

The audit by Ernst and Young, an accounting firm, was ordered by the SEC over allegations of accounting fraud and mis-use of funds in a rights issue.

The SEC said the audit by found “several irregularities in the conduct of business affairs of Blue Diamonds by the management which may point to the possible misappropriation of public funds” raised by the rights issue.

It also found “possible commission of one or more capital market offences as well as offences under the penal code,” the SEC said.

It said Blue Diamonds Jewellery Worldwide had sought time to respond to the audit report.

SLI expects flood damage claims to exceed Rs. 1 bn

By Hiran H.Senewiratne

"We are are expecting more than Rs one billion in claims from our clients, which we could recover from our re-insurers,among whom are several of the world's leading insurance companies. Therefore, it is not a big deal for us, Managing Director, Sri Lanka Insurance T. M. R. Bangsa Jayah said.

He told The island Financial Review that SLI is now waiting until claims are made by their customers for settlement.

Rs.7 billion in insurance payments for compensation and reconstruction, following destruction caused by the recent floods, will be borne by foreign reinsurers due to appropriate transfer of risks, some local insurance industry officials said.

Jayah said that the bottom lines of insurance companies are of no concern and that the insurance companies are currently focused on processing all insurance claims, evaluating them, and paying back the right amounts to their customers.

"However, it is too early to forecast the value of claims that would be paid by the industry, which implies the importance of insuring properties to minimize the loss, he said.

"The economic losses are quite high and there would be a significant impact on insurance companies, because they have re-insured their risks with international re-insurers, Insurance Association of Sri Lanka chairman Dirk Pereira said.

Finance Minister Ravi Karunanayake on Monday said the post flooding reconstruction costs would likely be between Rs.150 and 250 billion.

About 30 percent of the liabilities of insurance companies are required to be reinsured with the National Insurance Trust Fund (NITF) by law. "We still haven’t got adequate information, but the losses are heavy. We’re predicting it to be Rs. 4-5 billion or more. In a worse case situation, the claims could run up to Rs. 10 billion, NITF chairman Manjula Silva said.

"A lot of people are not insured. Some have insurance policies, but we have to look at the little man. We will have to evaluate if the houses are fully damaged or partially damaged. In some instances, we just have to clean and reframe. It’s difficult to give a number but it may run into a couple of million rupees, he said.

Silva said the NITF, which is worth Rs. 10 billion, has to only pay for 30 percent of the reinsurance of private sector claims, which would run up to about Rs. 1.5 billion. For government claims, NITF has to pay Rs.500 million, plus an additional 20 percent of the remainder. "The rest, we have reinsured with top weighted insurance companies around the world, he said.

Fitch assigns Sampath Bank’s subordinated debt final ‘A(lka)

Fitch Ratings-Colombo-24 May 2016: Fitch Ratings has assigned Sampath Bank PLC's (A+(lka)/Stable) Basel II-compliant subordinated debentures of up to LKR6bn a final National Long-Term Rating of 'A(lka)'.

The final rating is the same as the expected rating assigned on April 26 and follows the receipt of documents conforming to information already received.

The debentures will mature in five years and carry fixed and floating coupons. Sampath Bank plans to use the proceeds to strengthen its Tier 2 capital base. The debentures are to be listed on the Colombo Stock Exchange.

The issue is rated one notch below Sampath Bank's National Long-Term Rating to reflect the subordination to senior unsecured creditors.

Sampath Bank's rating reflects its lower capitalisation relative to that of its peers and relatively higher risk appetite, which offset benefits from the growth of its franchise. The Outlook is Stable.

The rating on the proposed debentures will move in tandem with Sampath Bank's National Long-Term Ratings.

Fitch views the upside potential of Sampath Bank's ratings as limited as long as the trend of higher risktaking and declining capitalisation persists. A sharp decline in its asset quality could result in a rating downgrade.

www.island.lk

Vehicle imports up 60%, registrations up 56% in 2015: CCC Vehicle Market Report

Expenditure on imports of motor vehicles into Sri Lanka recorded a 60% growth in 2015 compared to 2014 according to the latest edition of the ‘ Statistical Analysis and Industrial Overview of Sri Lanka’s Vehicle Market 2015,’ an annual publication issued by the Ceylon Chamber of Commerce.

According to the release, which is now available for purchase, Sri Lanka’s expenditure on motor vehicle imports during 2015 has accounted for 7% of the total import bill of the country and took up 13% of total export earnings.

With sharply increased vehicle imports, the registration of motor vehicles also has risen by 56% during 2015, thus pushing the country’s total vehicle population to 6.3 million.

Import of passenger vehicles recorded the highest growth in vehicle imports, growing by 88% year-on-year, mainly driven by imports of motor cars.

According to the report, more than half (53%) of the current vehicle population consists of motor bicycles followed by three-wheelers (17%) and motor cars (11%).

The report, compiled by the Economic Intelligence Unit of the CCC, features latest information on vehicle registration; vehicle population; imports of vehicles by vehicle category, popularity of key vehicle brands; and an overview on the global vehicle market. The newest addition to this year’s report is the information provided on the hybrid and electric vehicles market.

To obtain a copy of the report, contact Saumya Amarasiriwardene, Research Analyst, Economic Intelligence Unit of the CCC on 011-55-888-83 or saumya@chamber.lk.

www.ft.lk

Sri Lanka’s Hayleys net up 49-pct in March 2016 quarter

(LBO) – Profits at Sri Lanka’s diversified Hayleys group surged 49 percent to 1.3 billion rupees in the March 2016 quarter amid strong net income growth, interim accounts showed.

The group reported earnings of 17.57 rupees per share for the quarter, up from 11.83 rupees per share from a year earlier.

Group revenues rose 2 percent to 24.6 billion rupees and cost of sales rose at a slower 1 percent to 18.2 billion rupees making gross profit to grew 6 percent to 6.36 billion rupees.

Other income rose to 322 million rupees, from 182 million rupees a year earlier and distribution expenses rose 46 percent to 906 million rupees.

Finance income rose to 242 million rupees, from 93 million rupees a year earlier.

Hayleys posted a profit before tax of 6.8 billion rupees for the financial year, a 7 percent increase over the previous year.

Earnings per share increased to 40.05 rupees from 34.42 rupees per share in the previous year.

The group’s income tax paid during the year inclusive of super gain tax amounted to 2.3 billion rupees and it ended the year with a group turnover of 92 billion rupees.

“Hayleys has focused on the segments with the greatest long-term growth potential,” CEO Mohan Pandithage said.

“All our sectors have shown profitability while we have further strengthened our market leadership in most of the sectors we operate in.”

The transportation sector contributed 1.5 billion rupees profit to the group bottom line and agriculture sector profits grew to 1.2 billion rupees from 1 billion rupees in the last fiscal year.

The purification sector contributed over 1.2 billion rupees in profits for the financial year.

As at 31 March 2016, net assets per share was at 411.40 rupees against 388.05 reported a year earlier.

Annualized price earnings ratio stood at 6.13 rupees at the end of financial year against 8.72 rupees recorded a year ago.

Sri Lanka's Dipped Products buys full control of Italian marketing unit

ECONOMYNEXT – Sri Lankan rubber gloves manufacturer Dipped Products said it has bought full control of ICOGUANTI S.p.A., its Italian marketing company, with an investment of 3.2 million euro (about 535 million rupees).

The firm, part of the Hayleys Group, said that with the latest investment, ICOGUANTI S.p.A., which was a 60% owned subsidiary, was now a fully owned unit of the company.

Sri Lanka appoints managers for billion dollar sovereign bond: Finance Minister

ECONOMYNEXT - Sri Lanka has appointed eight financial institutions to manage a sovereign bond of at least a billion US dollars which may go to the market next month, Finance Minister Ravi Karunayake said.

Sri Lanka may take more than a billion US dollars if the rates are favourable, he told a meeting of Sri Lanka's Foreign Correspondents Association.

Four investment banks and four non-banks were in the group, he said.

Sri Lanka has reached preliminary agreement with the International Monetary Fund for a 1.5 billion US dollar Extended Fund Facility, which is expected to get the lender's Board approval in early June.

Sri Lanka's Central Bank Governor Arjuna Mahendran had said earlier that the country would go to the market armed with the IMF deal as rates would be lower.

Conditions in international capital markets have with the US expected to raise interest rates in a June meeting of the Federal Reserve, but Sri Lanka was confident of raising funds Karunayake said.

"There is a lot of money in the Middle and Asian areas," he said.

Sri Lanka would raise more than a billion dollars if rates were favourable, he said.

Sri Lanka is expecting wrap a 500 million US dollar three year syndicated loan with Citi, Emirates NBD, HSBC as early as next week to which Credit Suisse was also joining.

Karunanayake said Sri Lanka was in talks with Credit Suisse to float another 500 million dollar loans and was also eying Sukuk and Panda bond markets.

"We are looking at all options and will be taking the best ones," Karunanayake said.

Sri Lanka has a budget limit of raising 3.5 billion dollars in foreign loans this year.

Sri Lanka rolls over maturing Treasuries, yields up

ECONOMYNEXT - Sri Lanka's 3 and 6-month Treasuries yields edged up at Wednesday's auction with bids for 12-month bills rejected, data from the state debt office showed.

The debt office sold 9.15 billion rupees of 3-month bills at 8.71 percent up 05 basis points from a week earlier and 21.5 billion rupees of 6-month bills at an average yield of 9.67 percent, up from 9.40 percent on May 11.

A total of 30.7 billion rupees of bills was sold, successfully rolling over an estimated 30.6 billion rupees of maturing bills.

Sri Lanka's central bank precipitated a balance of payments crisis by rejecting bids and purchasing Treasuries to its own balance sheet, but there has been a series of successful auctions over the last few weeks.

When the central bank buys Treasuries with printed money (central bank credit), excess credit and imports puts pressure on the rupee. Unless the cash is mopped up in forex market by dollar sales the rupee will fall.

Sri Lanka JKH March profit down 13-pct

ECONOMYNEXT – Sri Lanka’s John Keells Holdings group said March 2016 quarter net profit fell 13 percent to 4.5 billion rupees from a year ago.

Sales were flat at 24.9 billion rupees, according to interim results filed with the stock exchange.

Other operating income fell while finance costs surged 300 percent to 529 million rupees from the year before.

Diluted earnings per share for the quarter were 3.79 rupees. EPS for the year ended 31 March 2016 were 12.09 rupees.

Annual net profit fell 02 percent to 14 billion rupees while sales went up just 02 percent to 93.3 billion rupees.

Sri Lankan shares snap losses to end higher, but foreign investors sell

Reuters: Sri Lankan shares snapped three straight sessions of losses on Wednesday to edge up from a 3-week closing low despite foreign investor outflows, as investors picked up telecom and diversified shares.

The benchmark stock index rose 0.2 percent, or 12.91 points, to 6,583.49, edging up from its lowest close since May 4 hit on Tuesday. It fell 1.12 percent last week, its first weekly fall in seven weeks.

"Market ended in the green zone, but the foreign selling is worrying," said Yohan Samarakkody, head of research, SC Securities (Pvt) Ltd.

Foreign investors net sold 446.4 million rupees ($3.05 million) worth of shares on Wednesday, extending the year to date net foreign outflow to 4.71 billion rupees worth of shares.

Shares in Dialog Axiata Plc rose 0.89 percent while Hemas Holdings Plc rose 2.58 percent, pushing up the overall index.

Top conglomerate John Keells Holdings, which on Tuesday announced a share subdivision, gained 0.2 percent. After the market closed, Keells posted a 13 percent fall in March quarter earnings.

Turnover stood at 952.2 million rupees ($6.52 million), more than this year's daily average of around 797.8 million rupees. 

($1 = 146.2000 Sri Lankan rupees) 

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

Central Bank following up on Panama Papers’ Lankan names

Sri Lanka is following up on the disclosure of Sri Lankan individuals who were named in the Panama Papers leaks, Central Bank Governor, Arjuna Mahendran said.

Speaking to Daily News Business he said that Central Bank Financial Intelligence Unit (FIU) has contacted authorities in Panama to obtain an official list of these people.

“Subsequently we will take appropriate steps after concluding the Sri Lanka Customs, Inland Revenue Department and may be event the Police Department unit to commence investigations,” he said.

Several companies and individuals with links to Sri Lanka were on the list, and more than 50 Sri Lankan addresses were also identified in the papers.

On May 9, client data stolen from the Mossack Fonseca law firm in Panama was published online by the ICIJ as part of its Offshore Leaks database.

The searchable database contains a portion of the offshore financial records given to the journalists by anonymous whistle-blowers since 2013; it does not include leaked emails and other explanatory data that ICIJ reporters use to write about the offshore financial holdings of newsworthy individuals.

The so-called Panama Papers, a trove of 11.5 million financial documents tracing the Mossack Fonseca law firm’s efforts to help politicians, celebrities and criminals shield their money from taxes, contain links to Soros, who funds the journalism group that is disseminating the information. So far, the International Consortium of Investigative Journalists (ICIJ) has been silent on its benefactor’s ties to the law firm.

www.dailynews.lk

Govt.’s 4 year development plan coming soon!

• PM unveils plans to release master plan in two weeks during National Summit on Foresight and Innovation address
• Medium term strategy to ensure rapid sustainable development 
• Stresses need for Sri Lanka to join global value chain, improve living standards
• Says SL can harness human resources and strategic position in the Indian Ocean to innovate
• Insists Megapolis must be large city in Asia, but also sustainable and livable
• Emphasises need for reconciliation and strengthening democracy

By Dharisha Bastians

The Government will unveil its four year development plan in two weeks, focused on rapid sustainable development to improve the country’s living standards and harness Sri Lanka’s strategic location and human resources, Prime Minister Ranil Wickremesinghe said yesterday.

Prime Minister Wickremesinghe, who participated in a Panel Discussion at #2030NOW, the National Summit on Foresight and Innovation for Sustainable Human Development last evening, said the Government was also looking to set up a Sustainable Development Council, a proposal that would be put to Cabinet and eventually to Parliament. The Premier said that Sri Lanka must join the global value chain, and the country’s economy must change and become more competitive. “We are living in an age profits alone, competition alone is not sufficient. Have to ensure people have good living standards to avoid popular revolts due to economic inequality,” Wickremesinghe explained.

He said a lot of countries had sacrificed the environment, their values and democracy for the sake of economic development. The Government was hoping to ensure development initiatives remained sustainable, Wickremesinghe added.

The Premier who addressed the session on “Reimagining Governance: An Opportunity for Sri Lanka,” posed important questions: “Can a Government have a dream? Can a Government have a vision? Just after 1947, Sri Lanka was leading Asia in economic and social development. What happened to us, that others overtook us? What happened to us, that we got left behind?”

The people of Sri Lanka want to catch up on lost opportunities, Premier Wickremesinghe noted.

“This is a challenging task, and in a democracy, to meet challenges you need consensus and a challenging team. This is why we have opted for a National Government – what we could not achieve as two separate political parties, perhaps we can achieve together,” Wickremesinghe hoped.

Outlining the two fold strategy for economic prosperity and innovation, Prime Minister Wickremesinghe said the Government was focused firstly on reconciliation and strengthening democracy. “Without reconciliation, the end of the war will never bring peace. We will never be one nation. Without strengthening democracy there will be no free flow of ideas that could lead to innovation,” he explained.

Wickremesinghe also highlighted the need to strengthen economic cooperation across the globe through free trade agreements and economic partnerships.

Since time immemorial Sri Lanka has traded with the world, but to trade with the world today the country requires an edge in a competitive market system, he explained.

“First we need to move in and ensure we have a sufficient number of FTAs which will enable you to deal with a large number of countries. We need to focus on economic and trade cooperation from Europe to Japan, including India, China, Malaysia, Indonesia, Thailand and Korea. Where all this leads for us is an agreement with the United States – of course this will be decided only after November 2016,” the Prime Minister said, referring to the US Presidential election.

Sri Lanka needed to focus on its greatest capital – human resources – and build on this resource and skills. “A policy for human development, combined with our strategic position, can lead to innovation,” the Premier told summit participants at Water’s Edge, Battaramulla at the closing session.

Wickremesinghe said part of the Government’s plan to make Sri Lanka competitive included its ambitious plans to turn the Western Province into a mega city.

“We will make it a large, livable city in the Indian Ocean. There are many issues left to be resolved, as last week’s flooding showed us – much of the disaster was man made,” he said.

The Prime Minister said the Megapolis must not only be the largest city in the Indian Ocean, but it must also rank high in sustainable development. “It must be a livable city. In South Asia now many cities are no longer livable,” Wickremesinghe explained.

As Sri Lanka puts plans in place for innovation and technology to boost economic growth, Prime Minister Wickremesinghe emphasised that it was important not to forget the countryside, and the Government would strive to modernise the rural economy.

In the war-battered Northern Province, it was not only the economic fabric that had been destroyed, but also the social fabric that tied communities together, the Prime Minister said.

“In the north now, a village is a group of houses built in one place. We have to find a way to restore the social fabric and build community in these regions. The culture in the north is strong enough to rebuild,” he asserted.

The session attended by Prime Minister Wickremesinghe was moderated by UNDP Resident Representative, Peter Batchelor and included Vice President, myForesight Institute, of the Government of Malaysia, Director of Mindlab, Government of Denmark, Thomas Prehn, Performance and Social Innovation Lead – eGov Center, Government of Moldova, Cornelia Amihalachioae and Lead, Kolba Lab, UNDP Armenia, Marina Mkhitaryan.

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Sri Lanka’s John Keells Holdings to subdivide ordinary shares

(LBO) – Sri Lanka’s diversified John Keells Holdings has decided to subdivide ordinary shares of the company while making an adjustment to its warrants.

The company said in a stock exchange filing, the directors have recommended a share subdivision where by every seven existing ordinary shares will be subdivided to eight ordinary shares.

Accordingly, number of ordinary shares as well as the number of warrants in issue will be increased and the purchase price of a warrant will be reduced to 149.29 rupees from 170.62 rupees.

John Keells Holdings said the number and exercise price of employee share options in issue will also be adjusted proportionately.

The proposed subdivision is subjected to shareholder approval at an extraordinary general meeting.

A share subdivision is generally the opposite of a consolidation with the number of shares in issue being increased by a set ratio.

In turn the nominal value of the shares and the market price per share of the shares will decrease by the same ratio.

Fitch assigns ‘A(lka)’ to Sampath Bank debentures

Fitch Ratings has assigned Sampath Bank’s Basel II-compliant subordinated debentures of up to Rs 6 bn, a final National Long-Term Rating of ‘A(lka)’.

The final rating is the same as the expected rating assigned on April 26, 2016 and follows the receipt of documents conforming to information already received.

The debentures will mature in five years and carry fixed and floating coupons. Sampath Bank plans to use the proceeds to strengthen its Tier 2 capital base. The debentures are to be listed on the Colombo Stock Exchange.

The issue is rated one notch below Sampath Bank’s National Long-Term Rating to reflect the subordination to senior unsecured creditors.

The Outlook is Stable.
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Asian Alliance Insurance posts Rs 267 mn profit in Q1

Asian Alliance Insurance posted impressive growth for the first quarter of 2016.

Asian Alliance Insurance PLC recorded a profit after tax (PAT) of Rs 267.2 million for the first quarter of 2016 for Life business where profits were determined based on actuarial assessment, whilst the combined profit after tax including its fully owned subsidiary Asian Alliance General Insurance Ltd was Rs 212.4 million.

Life insurance premiums topped the billion rupee mark to reach Rs 1.4 billion, with a growth of 48% compared with the same period of the previous year,double the industry growth of 23% for the first quarter of the 2016.

The Company has stepped up the intensity of its operations with a number of industry firsts in its Life business. Amongst these, ‘eAdvisor’ which is the latest technological innovation from the country’s most innovative insurance provider, will simplify and streamline a range of functions, by eliminating paper and by enabling instant generation of Life Insurance quotations.

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Hayleys posts Rs. 6.8 billion in PBT

Hayleys has posted Profit before Tax (PBT) of Rs. 6.8 billion for the financial year 2015/16, a 7% increase over the previous year.

Earnings per Share (EPS) increased to Rs. 40.05 from Rs. 34.42 per share in the previous year. This strong growth reflects the effectiveness of the conglomerate’s focused strategy on expanding its core business sectors and ended the year with a Group turnover of Rs 92 bn. The Group’s Income Tax paid during the year, inclusive of Super Gain Tax, amounted to Rs 2.3 bn.

Hayleys PLC Chairman and Chief Executive, Mohan Pandithage said, “Hayleys has focused on the segments with the greatest long-term growth potential and I am extremely pleased to note that all our sectors have shown profitability while we have further strengthened our market leadership in most of the sectors we operate in.”

The Transportation and Logistics Sector contributed Rs. 1.5 billion Profit Before Interest and Tax (PBIT) in profits to the group bottom line. The sector has continued to drive new business opportunities both locally and internationally and has introduced a number of outstanding innovations across its business segments that boost its service offerings. Among the noteworthy new ventures is the Hayleys - Free Zone, a state-of-the-art entreport trade facility, including cold storage, which offers businesses the opportunity to value-add and repackage products for export.

Agriculture sector PBIT grew to Rs. 1.2 billion from Rs. 1 billion in the last fiscal year. The sector diversified into a number of new business areas during the last two years, which have contributed to growth.

The Purification sector contributed over Rs. 1.2 billion in PBIT for the financial year 2015/16.In addition to being a major contributor to Group profits, the sector has also lead the Group’s efforts to improve the living and economic conditions of the people in the North and North Central Province suffering from Chronic Kidney Disease (CKD). As of May 2016, Hayleys companies have contributed over Rs. 44 million towards setting up ten Reverse Osmosis (RO) plants. The ten plants provide a cumulative 100,000 litres of clean drinking water per day to 15 villages and over 20,000 people in the region.
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Sri Lankan shares close at 3-wk low on flood woes

Reuters: Sri Lankan shares fell for the third straight session on Tuesday to a 3-week closing low, led down by large caps and stocks likely to be hit by the country's worst natural disaster since the 2004 Asia tsunami.

The benchmark stock index fell 0.95 percent, or 62.69 points, to 6,570.58, its lowest close since May 4.

The index fell 1.12 percent last week, its first weekly fall in seven weeks.

On Monday, the government said the cost of landslides and floods will be between $1.5 billion and $2 billion at the minimum, as it struggles to recover from days of torrential rains that have so far claimed the lives of 94 people.

"Flood situation was the main reason for the drag down. People have started to realise the real impact and going forward more negativity should come into the market," said Yohan Samarakkody, head of research, SC Securities (Pvt) Ltd.

Lion Brewery Plc dropped 4.76 percent on Tuesday, after the alcoholic beverages manufacturer said last week it had halted production in its main factory in a Colombo suburb due to the floods.

It fell 3.45 percent on Monday.

Stockbrokers said manufacturing and banking sectors are likely to be hit due to the low employee turnout during the floods.

Concerns over a government move to increase the value added tax and impose new taxes effective May 2, which could hit the bottom line of many companies, also dented sentiment.

Turnover was 762.9 million rupees ($5.23 million), in line with this year's daily average of around 796.1 million rupees.

Foreign investors, who have net sold 4.26 billion rupees worth equities so far this year, were net buyers of 44.8 million rupees worth of shares on Tuesday.

Sri Lanka Telecom Plc fell 4.42 percent and conglomerate John Keells Holdings Plc lost 0.19 percent, dragging down the overall index. 

($1 = 145.8000 Sri Lankan rupees) 

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

Asia Asset Finance plans to double profit by 2017

Asia Asset Finance PLC (AAF) is looking to almost double their profits (PAT) by next financial year.

The company posted Rs. 175 million PAT in and now has set up a Rs. 300 million target for 2017 March 31.

Muthoot Finance Ltd. (MFL) which acquired 51% equity shares of Asia Asset Finance PLC (AAF), and later increased it to 60% is also aggressively pursuing this goal and are jointly looking to introduce more financial tools.

The 128 year old Indian family owned company is India’s largest gold financing company.”We will certainly look at the Gold loan segment more aggressively and also look at more SME and Micro financing,”MFL Chief General Manager K.R. Benjamin told the Daily News Business. “We are also keen to enter the insurance segment in Sri Lanka.”

Asia Asset Finance [formerly known as the Finance and Land Sales Ltd], has been serving the Sri Lankan community since 1970 and with their strong presence we are also looking at introducing some of our other 15 fields to Sri Lanka.”

“The tie up with Muthoot Finance has enabled AAF to secure low cost diversified funding lines on top of the increasing customer deposit portfolio. It has also transferred technology and ‘business know how’ especially in the Gold Loan product which was hitherto not in the product offers of AAF. The strength in the treasury has enabled AAF to be more creative with the products being offered and also make products more flexible to cater to a bigger demographic,” said Chairman Asset Managemnt Manohan Nanayakkara. (SS)

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Vehicle registrations drop sharply

Motor car registrations recorded 3,618 units in April up from 3,326 units a month ago and significantly down from 5,116 units 12 months ago.

According to J. B. Securities the precipitous fall in registrations recorded in January and February may not entirely be explained by a fall in demand but by a go slow from the Registrar of Motor Vehicles (RMV) that resulted in a reduction in the number of registrations. In a similar vein part of the pickup in numbers in the subsequent month’s maybe clearing of the previous months’ backlog.

Brand new segment registrations recorded 1,709 units in April significantly up from 1,186 units the previous month but significantly down from 2,926 units recorded 12 months ago. Maruti recorded 1,142 units in April significantly recovering from 639 units the previous month and the extremely low 255 units in Jan but yet significantly down from 2,239 units 12 months ago.

Micro recorded 141 units up from 108 units the previous month and Hyundai recorded 125 units gaining on 112 units recorded the previous month.

Re-owned car registrations recorded 1,909 units in April marginally down from 2,140 units a month ago and also marginally down from 2,190 units 12 month ago. Toyota recorded 798 units in April marginally down from 906 units in March and Suzuki recorded 624 units in the month marginally down from 675 units the previous month. The taxes have increased by around 80% and the CIF value of vehicles in Rs have also increased doubling their value. Financing share was 66.3% significantly up 55.9% the previous month.

Electric cars recorded 85 units in April significantly down from 160 units the previous months and 152 units 12 months ago. Nissan Leaf accounted for 85 of the units down from 185 units the previous month.

SUV registrations recorded 706 units in Apr up from 610 units the previous month and marginally up from 704 units 12 months ago. Hybrid registrations recorded 2,253 units in Apr up from 2,328 units the previous month and 2,300 units 12 months ago.

The 3-wheeler registrations recorded 4,151 units in Apr up from 3,978 units the previous month but significantly down from 10,839 units 12-month ago. At the peak in Nov 2015 registrations hit 13,668 and in Feb registrations at 2,939 units was a 60-month low. The two -wheeler registrations recorded 23,956 units in April down from 28,619 units the previous month but 27,669 units 12 months ago. Bajaj claimed a segment share of 33.3% followed by Honda with 24.6%, Hero with 19.8%, TVS with 12.3% and others accounted for 10%.

Van registrations recorded 295 units in Apr down from 429 units the previous month and down 68% from 12 months ago. Financing share was 72.9%.

Pickup truck registrations recorded 236 units in Apr marginally up from 228 units the previous month but significantly down from 403 units 12 months ago. Tata is the market leader with 66.9% followed by Toyota with 17.8% and Mahindra with 5.5%. Mini truck registrations were 788 units in Apr down from 840 units in Mar and significantly down from 1,357 units recorded 12 months ago.

Lite truck registrations recorded 541 units in April up from 595 units the previous month and 504 units 12 months ago. Medium trucks registrations were 107 units in Apr down from 163 units the previous month and 167 units 12 months ago. Heavy trucks registrations were 81 units in Apr down from 132 units the previous month and significantly down from 284 units 12 months ago. Ashok Leyland unseated Tata to claim segment leadership with a share of 47.5% followed by Tata with a segment share of 41.3%. Financing share was 53.8% institutional purchase.

Buses recorded 144 units in Apr down from 182 units the previous month but up from 122 units recorded 12 months ago. Ashok Leyland is the market leader with a share of 41.3%. Financing share was 85.7%.

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Sri Lanka nation-wide inflation surges to 4.3-pct in April 2016

ECONOMYNEXT – Sri Lanka’s consumer prices nation-wide rose 4.3 percent in April 2016 from a year ago, accelerating from 2.2 percent in March, its third straight monthly rise, the statistics department said.

On a month-on-month basis, the new National Consumer Price Index (NCPI), compiled using prices collected from all nine provinces with a base year of 2013, in April rose 1.5 percent after having fallen 0.7 percent in March.

Consumer prices in the Sri Lankan capital Colombo, measured by the Colombo Consumer Price Index, had risen 2.0 percent in March 2016 from a year ago.

The statistics department said on an year-on-year basis, contribution of food commodities to NCPI was 2.14 percent in April 2016 and that of Non food items was also 2.14 percent.

FinanceAsia names Commercial Bank ‘Best Bank’ in Sri Lanka

ECONOMYNEXT - FinanceAsia magazine has declared Commercial Bank of Ceylon as the ‘Best Bank’ in Sri Lanka in 2016 in its latest awards.

“This is the sixth ‘FinanceAsia Country Banking Achievement Award’ presented to Commercial Bank in the eight years since the Bank became the first entity in Sri Lanka to receive this coveted tribute in 2009,” a statement said.

As FinanceAsia celebrates 20 years covering Asia’s financial markets this year, the magazine chose Commercial Bank for a one-off Platinum Award presented to banks and corporations that have consistently excelled over the past two decades.

The FinanceAsia Country Award is based on the banks’ financial performance.

It considers profits, bad loan ratios, provisioning, return on equity, capital adequacy ratios, totalassets, loans, deposits, branch network, vision and long-term strategy, market position versus the nearest competitor, principal sources of profit, and feedback of stock market analysts.

“There are no subjective assessments for the FinanceAsia awards, which are based strictly on hard facts and figures,” Commercial Bank’s Managing Director/CEO Jegan Durairatnam said.

“They are, therefore, an excellent benchmark not only to reaffirm the Bank’s position in the market, but to compare its performance with other top banks in the region.”