Sri Lanka T-bill 03-month yields up 13bp

ECONOMYNEXT – Sri Lanka’s three month Treasury Bills yields rose 13 basis points to 7.14 percent at Wednesday auction, the debt office said.

The debt office, a unit of the central bank, got bids worth 16.3 billion rupees and accepted bids worth five billion rupees.

No bids were accepted for the six month and one year bills.

Norges Bank increases shareholding in Dialog Axiata

(LBO) – Norges Bank has increased its shareholding in Dialog Axiata PLC to 63.7 million shares as of end December, data filed with the Colombo Stock Exchange shows.

Norway’s Norges Bank, which manages the world’s biggest sovereign wealth fund, is now the sixth biggest shareholder in telecommunications company Dialog with a 0.8 percent stake.

The shareholding is up from 28.7 million shares as of end September.

Norges Bank Investment Management has close to a 800 billion dollars invested in global assets, a fund built from the country’s oil revenues.

Sri Lanka’s Dialog Axiata net down 58-pct in December quarter

(LBO) – Profits at Sri Lanka’s Dialog Axiata group, which has interests in mobile, fixed and pay television, declined 58 percent to 620 million rupees from a year earlier in the December 2015 quarter, interim accounts showed.

Revenues grew 16 percent to 20 billion rupees in the December quarter from a year earlier, direct costs rose 12 percent to 10.9 billion rupees and gross profits rose 21 percent to 9.1 billion rupees.

Net finance cost of the group has jumped close to two folds in the December quarter to 572 million rupees.

The group reported earnings of 8 cents per share for the quarter compared with 18 cents per share a year ago.

In the year to December profits of the group has declined 15 percent to 5.2 billion rupees from a year earlier, interim accounts showed.

At an entity level, Dialog Axiata featuring the mobile, international and tele-Infrastructure segments of the group portfolio contributed a major share of group revenue of 84 percent.

On the back of its Mobile customer base of over 10.8 million subscribers, Company revenue grew by 9 percent year on year to be recorded at 62.9 billion rupees.

Dialog Television, the digital pay television business of the group continued its positive growth momentum, recording a revenue growth of 23 percent year on year to reach 5.8 billion rupees in 2015.

DTV’s pay TV customer base was recorded at 650,000 subscriptions as at the end of December 2015.

Dialog Broadband Networks featuring the group’s fixed telecommunications and broadband business recorded revenue of 7.3 billion rupees, representing an increase of 19 percent year on year.

Group capital expenditure for in 2015 was recorded at 19.6 billion rupees.

The company said capital expenditure was directed in the main towards investments in high speed broadband infrastructure alongside the extension of the group’s Optical Fibre Network, and investments associated with the final phase of the Bay of Bengal Gateway Sub-Marine Cable project.

Dialog Axiata has proposed a cash dividend of 32 cents per share totaling to 2.6 billion rupees subjected to necessary approvals.

Sri Lankan shares fall to near 22-month low on rising rates

(Reuters) - Sri Lankan shares fell for an eight straight session on Wednesday, marking their lowest close in about 22 months as rising domestic interest rates and global economic worries dampened investor sentiment.

Sri Lanka's main stock index CSE ended down 0.53 percent at 6,220.82, its lowest close since April. 29, 2014. It has fallen 2.87 percent in the last eight sessions to Wednesday.

"Things are not looking bright. Investor confidence is very bad at the moment as they do not see a direction and the economy is getting weaker day by day," said Dimantha Mathew, research manager at First Capital Equities (Pvt) Ltd.

The key index has fallen 9.8 percent this year through Wednesday, amid a rise in market interest rates.

Yields on 91-day t-bills rose 13 basis points at a weekly auction on Wednesday to a more than two-year high, signalling a further rise in market interest rates. The central bank rejected all bids at 182-day and the 364-day t-bill auctions which is also at more than two-year highs. was 425.6 million rupees ($3 million), less than this year's daily average of 711 million rupees.

Foreign investors were net buyers of 91.9 million rupees worth of shares on Wednesday. But they have sold a net 201.7 million rupees worth of shares so far this year.

Shares of Sri Lanka Telecom Plc SLTL.CM fell 0.26 percent, while Distillers Sri Lanka Plc DIST.CM lost 2.32 percent and conglomerate John Keells Holdings Plc JKH.CM declined 0.44 percent. 

($1 = 144.0000 Sri Lankan rupees)

Sri Lanka Guardian Capital invests in Singapore tech firm

ECONOMYNEXT – Guardian Capital Partners has invested in a Singaporean technology firm run by Sri Lankan entrepreneurs that has developed a mobile payment application.

The company, the fund management arm of the Carson Cumberbatch group, holds 438 million rupees in cash which it is looking to deploy if attractive deals are available, according to December 2015 interim accounts filed with the stock exchange.

“We have been seeing lot of activity in the IT vertical concentrated around early stage start up companies,” a note to the accounts said.

The company said it has made a commitment to invest 10 million rupees in Kashmi Singapore Pte Ltd., based in Singapore.

Kashmi has developed and runs a Peer to Peer mobile payment solution with embedded social media functionality which enables cash transfers between individuals and vendors through a mobile app.

The company is promoted by a group of young Sri Lankan entrepreneurs, operating out of Singapore and Sri Lanka.

Guardian Capital Partners said Kashmi will initially launch the product in Singapore and then it hopes to expand into other ASEAN countries like Malaysia and Indonesia.

Sri Lanka Megapolis plan downsizes China Port City

CITY PLAN: One of the options proposed for the China Port city in the new Sri Lanka Megapolis

ECONOMYNEXT - A structure plan to expand Sri Lanka's capital into a 'Megapolis' of nine million people by 2040 has proposed a sharp downsizing of a 'port city' to reclaimed out of the sea by Chinese state firm.

A concept plan for the Megapolis developed with Singapore's Surbana Jurong has proposed a 90 hectare city with a marina instead of a 200 plus hectare reclamation protected by a breakwater originally proposed.

"When you say Port City most people refer to the Chinese company that is developing the port city near the South Colombo Port," Megapolis Minister Champika Ranawaka told a business forum on January 22.

"But our port city is bigger. It is a maritime city that is planned from Mutuwal to Wellawatte. The entire area will be developed into a one big city, with port related activity.

Se we proposed to the Chinese to company to re-design their port city program to suit our Mega plan."

About 40 hectares of area had already been reclaimed from the sea. The

A concept plan for the Western Province Megapolis showed two options which will add either another 44 or 49 hectares incorporating a marina with no outer breakwater.

It will fit with the existing 'Colombo Downtown' instead of being a self-contained area.

"To cater for good connectivity and seamless extension, the development parcels at the Port City are planned based on a grid urban pattern which extends from the existing road network within the downtown area," the concept plan said.

"This grid creates a flexible framework with a series of land parcels that can be combined or sub-divided to meet requirements or cater to changing demands and allow the phasing of developments.

"The Port City will be Sri Lanka’s most exciting and ambitious urban project designed to support continuing growth as a major business and financial hub in South Asia. It will raise the international profile of Sri Lanka while spurring growth and investment."

Fitch rates HNB's subordinated debt final 'A+(lka)

Fitch Ratings has assigned Hatton National Bank PLC's proposed subordinated debentures of up to Rs 7 bn a final National Long-Term Rating of 'A+(lka)'.

The assignment of the final rating follows the receipt of documents conforming to information already received, and the final rating is the same as the expected rating assigned for the subordinated debt on September 4, 2015. The issue will have a tenor of five years with fixed coupon payments. HNB expects to use the proceeds to reduce asset and liability maturity mismatches while improving its Tier 2 capital base. 
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MTD Walkers posts Rs 2.7 bn revenue in Q3

Integrated infrastructure and engineering solutions provider MTD Walkers has posted a revenue of Rs 2.7 billion for the third quarter of 2015/16.

The Group has managed to increase its gross profit margin to 25% from 16% in the third quarter last year in what continues to be a tough year for the construction industry.

"It is encouraging to see that the Government remains committed to infrastructure development. The Group has been able to broaden its scope of work and undertake a range of new projects with many countries funding development activities in Sri Lanka. The Group is now poised to return to a high growth phase leveraging on structural changes made during the slowdown experienced earlier this year," MTD Walkers Executive Deputy Chairman Jehan Amaratunga said. "We are delighted to be recognised for our commitment to the industry by being awarded the Gold Award in the construction sector at the National Business Excellence Awards. This award has reaffirmed our position in the industry and the Sri Lankan business environment."

Group Chief Financial Officer Viraj de Silva said the construction industry is recovering quickly and expect the industry to continue to spur economic growth in Sri Lanka. "The cost control measures adopted by the Group at sites and head office have enabled us to record a profitable quarter compared with the first half of the year. We expect the new operating practices of the Group to be sustainable and positively affect margins in the coming quarters,"he said.
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