Sri Lankan shares climb to near 2-month closing high

Reuters: Sri Lankan shares rose on Friday, closing the first week of the new year on a firm note, on the back of heavy foreign buying in blue chips.

The Colombo Stock Index ended 0.85 percent firmer at 6,514.73, its highest close since Nov. 11.

It rose 2.3 percent this week, in its second consecutive weekly rise.

Foreign investors net bought shares worth 357.1 million rupees ($2.33 million) on Friday, extending the net foreign inflow in this year to 1.96 billion rupees.

They had net bought 18.5 billion rupees worth equities in 2017 and 633.5 million rupees in 2016.

Turnover stood at 1.4 billion rupees on Friday, more than last year’s daily average of 915.3 million rupees.

Shares in conglomerate John Keells Holdings Plc rose 2.6 percent, Dialog Axiata Plc gained 3.1 percent and Melstacorp Ltd climbed 3.1 percent.

There was continued buying interest with an added interest in blue chips, said Dimantha Mathew, head of research at First Capital Holdings.

“There is renewed interest from foreign investors which is a good sign,” said Mathew, adding that he expected the positive trend to continue due to declining market interest rates.

Treasury bill rates fell 188 basis points to 216 basis points between March and end-December 2017, mainly driven by foreign investors buying treasury bonds, resulting in declining market interest rates.

The country’s 2018 economic growth trajectory is likely to help boost market sentiment, analysts said.

Sri Lanka’s economic growth in 2018 is forecast at 5-5.5 percent, bouncing back from an anticipated four-year low of less than 4 percent last year, central bank Governor Indrajit Coomaraswamy said on Wednesday.

The central bank kept its benchmark interest rates unchanged last week, saying inflation and private sector credit growth have cooled to a manageable level as policy makers focus on supporting a slowing economy. 

($1 = 153.4500 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Subhranshu Sahu)

DFCC Bank to raise Rs 7 bn via debenture issue

DFCC Bank PLC has decided to raise Rs 7 billion via a debenture issue.

Accordingly, the bank will issue 50 million Basel III compliant, subordinated, listed, rated, unsecured, redeemable debentures with a non - viability conversion option, each at an issue price (par value) of Rs. 100 with a term of up to 7 years (“Debentures”), with an option to issue a further 20 million of said debentures in the event of an over-subscription, subject to obtaining all necessary regulatory and other approvals.

DFCC Bank PLC is a fully-fledged Commercial Bank that offers an array of seamless retail banking solutions. This includes Savings and Deposit products that give customers unmatched value and unique benefits.

The Bank has been rapidly growing its footprint across the country with a network of 138 service points and 95 fully fledged branches.

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Renuka Capital acquires shares of ONAL

Renuka Capital PLC, acquired by way of a crossing transaction on the Colombo Stock Exchange, 2,143,035 ordinary shares of On’ally Holdings PLC (“ONAL”) at a price of Rs. 48 per share representing 12.245% of the voting rights in ONAL.

Renuka Capital PLC therefore now owns a total of 6,175,790 shares in ONAL representing 35.29% of the voting rights of ONAL.

Pursuant thereto, a mandatory offer at a price of Rs. 48 per share will be made by Renuka Capital to the remaining shareholders of ONAL in terms of Rule 31(1) (a) of the Company Takeovers and Mergers Code 1995 as amended in 2003, to acquire the ordinary shares held by such shareholders in ONAL.

Accordingly, in compliance with the provisions of the Code, Renuka Capital will make a detailed announcement on the mandatory offer in terms of Rule 8(1) read together with Rule 9 of the Code shortly.
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