Sri Lankan shares snap 5-day wining streak

Reuters: Sri Lankan shares ended marginally lower on Thursday, snapping a five-session winning streak, as investors booked profit in telecommunications shares and foreign investors continued to exit risky assets.

Investors were also concerned that the government's move to increase the value added tax and impose new taxes, effective from May 2, would hit the bottom lines of companies.

"It (the stock index) hit the resistance level and turned back. There is a lot of selling pressure but people are waiting to see where the level is," said Dimantha Mathew, head of research, First Capital Equities (Pvt) Ltd.

"The fall indicated the weakness in the market and the selling pressure but John Keells was holding the market."

The benchmark stock index ended 0.08 percent, or 5.33 points, weaker at 6,656.12, after posting its highest closing level since Jan. 8 on Wednesday.

Shares of Sri Lanka Telecom Plc fell 5.1 percent, while Asiri Hospitals Plc dropped 2.7 percent.

Conglomerate John Keells Holdings Plc rose 1.2 percent.

Turnover was 1.03 billion rupees ($7.08 million), more than this year's daily average of around 786 million rupees.

Foreign investors offloaded a net 226.2 million rupees worth of shares, extending the net selling so far this year to 3.97 billion rupees worth of equities.

The 14-day relative strength index stood at 80.539 on Thursday, compared with Wednesday's 81.677, Thomson Reuters data showed. A level of 70 and above indicates the market is overbought. 

($1 = 145.5000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal; Editing by Subhranshu Sahu)

Sri Lanka’s Dialog Axiata net up 35-pct in March quarter

(LBO) – Profit after tax at Sri Lanka’s Dialog Axiata group, which has interests in mobile, fixed and pay television rose 35 percent to 2.6 billion rupees from a year earlier in the March quarter, interim accounts showed.

Revenues grew 22 percent to 21.1 billion rupees in the quarter from a year earlier, direct costs rose at a slower 19 percent to 11.4 billion rupees and gross profits rose 26 percent to 9.7 billion rupees.

The group reported earnings of 33 cents per share for the quarter compared with 24 cents per share a year ago.

As at the end of financial year mobile segment of the group has made revenue of 18 billion rupees while the fixed and broadband segment reporting 2 billion rupees in revenue.

Pay television has recorded 1.5 billion rupees revenue while crossing 701,000 subscriptions as at the end of March 2016.

The Group has remitted a total of 6.8 billion rupees to the Government during March 2016 quarter and capital expenditure for the quarter was recorded at 2.9 billion rupees.

Capital expenditure has been directed in the main towards investments in high speed broadband infrastructure alongside the extension of the Group’s Optical Fibre Network.

As at the end of 2016 financial year, 21,020 public shareholders were holding 16.68 percent of the total shareholding of the company.

Sri Lanka Com Bank March quarter net up 29-pct

ECONOMYNEXT – Sri Lanka’s Commercial Bank said group net profit for the March 2016 quarter grew by 28.7% to almost 3.3 billion rupees from a year ago.

Earnings per share for the three months were 3.72 rupees, a stock exchange filing said.

The bank, in a statement, attributed the performance to a “notable improvements in business volumes and reduced growth in charges.”

A 101 billion rupee year-on-year growth in its loan book resulted in interest income increasing by 2.4 billion rupees or 15.45% in the quarter to 18 billion rupees at bank level.

“Net interest income for the three months was 8.1 billion rupees, a growth of 12.17%, the lower growth rate due to an 18.27% increase in interest expenses (9.9 billion rupees) consequent to a rise in rates,” the statement said.

Commercial Bank said it achieved a “noteworthy reduction” of 25.17% in total impairment charges to 995 million rupees through a reversal in the provision for individual impairment due to an improvement in Non Performing Loans.

Total assets grew by 45 billion rupees or 5.09% from 31st December 2015 to 924 billion rupees at 31st March 2016.

Loans grew to 537 billion rupees from 508 billion rupees while deposits went up 28.9 billion rupees to 653 billion rupees.

Deposit growth over the three months averaged 9.65 billion rupees per month.

“This is a solid start to the new year, particularly when viewed against the prevailing market conditions,” Commercial Bank Chairman Dharma Dheerasinghe said.

“The Bank’s ability to increase volumes in all key areas of business, thereby minimising the impact of a drop in gains from bond trading, indicates an operational strength that augurs well for the rest of the year.”

Commercial Bank Managing Director Jegan Durairatnam said projections based on the steady growth of its asset base indicated the bank is poised to record significant improvements in all areas in the current year.

Commercial Bank said net fees and commissions improved by 16.19% to 1.5 billion rupees and total other income grew by 17.87% to 1.4 billion, the latter as a result of higher net gains from trading, mark to market gains and exchange gains.

However, other income including gains from bond trading declined by 81.36% or 1.47 billion rupees compared to the previous year’s figure.

Sri Lanka 01-year T-bill yield up 10bp to 10.37-pct

ECONOMYNEXT – One-year Sri Lankan Treasury Bill yields rose 10 basis points to 10.37 percent at Wednesday’s auction, the public debt department said.

The department, a unit of the Central Bank of Sri Lanka, rejected bids for 03-month T-bills.

The yield on the 06-month bill fell 23 basis points to 9.40 percent at the auction.

The public debt department received bids worth 72 billion rupees and accepted bids worth 8.2 billion rupees.

AIA Sri Lanka reports excellent Q1 results

AIA Insurance Lanka PLC announced financial results of the company and its subsidiaries for the three months ended March 31,2016.

Gross Written Premium (GWP) of life insurance business, grew by 31 per cent to Rs 2,372 million. The outstanding growth was supported by a strong increase in both premium persistency and a change in premium mode mix which saw an increase in annual premium collection.

Investment income increased 25 per cent to Rs 1,107 million due to increase in interest rates.

Consolidated Revenue of the life insurance business increased 23 per cent to Rs 3,215 million compared to the same period in the previous year. Profit after tax increased 135 per cent to Rs 87 million.

AIA Sri Lanka CEO Shah Rouf said AIA Sri Lanka had a strong start in 2016 by achieving a significant growth in GWP in the first quarter. “We continued to stay focused on meeting customer needs through improving our product portfolio, distribution reach and capabilities of both our Agency and Bancassurance channels providing a strong platform for growth.”

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Ceylinco Insurance announces record 225% dividend

Ceylinco Insurance has announced record 225% dividend to shareholders. This constitutes a 225% dividend of the original share price. This is also an increase of 12.5% of the dividend declared in 2014.

Ceylinco Insurance said that the company was able to declare this dividend due to the outstanding results of its two wholly owned subsidiaries, Ceylinco General Insurance Ltd and Ceylinco Life Insurance Ltd. Ceylinco Insurance PLC believes that its success is a reflection of its resilience and strength, expressed through the shareholder and customer confidence in the company.

The revenue of Ceylinco Insurance exceeded Rs. 34.6 billion in 2015 with its insurance sector contributing Rs. 32 billion, the education sector Rs. 2.1 billion, the power and energy sector Rs. 445 million, with the others contributing the balance.

Ceylinco Insurance Managing Director and Chief Executive Officer Ajith Gunawardena said this record dividend, probably the highest dividend declared by a company in the financial sector was made possible by the unwavering confidence placed by customers and shareholders.

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