Sri Lanka shifts tyre plant location after land owner protests

ECONOMYNEXT – Sri Lanka has shifted the location of a proposed tyre plant by Ceylon Steel Corporation, for which Italy’s Marangoni will supply equipment from a closed plant, after protests by land owners.

The Ministry of Development Strategies and International Trade had originally proposed taking about 100 acres from private coconut estates in Gonapola, Horana, 5km from the southern expressway.

But objections from land owners meant that option was not feasible, the ministry has said.

Instead, a plot of land at Wagawatta, Horana, under the administration of the Board of Investment will now be given for the plant.

The factory is to be set up by the Ceylon Steel Corp with technical collaboration from Marangoni.

Sri Lanka Kelani Valley Plantations losses rise

ECONOMYNEXT – Sri Lanka’s Kelani Valley Plantations sank even further into the red in the September 2016 quarter with losses rising 90% to Rs168 from a year ago, according to interim accounts filed with the stock exchange.

Group sales of the firm, part of the Hayleys conglomerate, rose two percent to Rs1.5 billion but costs rose even more, including sharply higher finance costs.

The accounts showed lower sales in tea and rubber as the firm suffered from dry weather and the continuing commodities slump.

Kelani Valley Plantations reported a loss per share of Rs4.94 compared with a loss of Rs2.60 a year ago.

The tea business made a loss compared to a profit the year before while rubber profits were sharply lower.

The firm has three subsidiaries - Kalupahana Power Company (Private) Limited, Kelani Valley Instant Tea (Private) Limited and Mabroc Teas (Private) Limited.

Sri Lanka’s People’s Leasing & Finance Sept net down 9.8-pct

ECONOMYNEXT – People’s Leasing & Finance’s net profit for the September 2016 quarter fell 9.8% to Rs1.1 billion with lower earnings from its leasing and higher purchase business although interest income from loans grew.

Net interest income of the firm, a subsidiary of People’s Bank, fell 2.3% to Rs2.6 billion with interest income up 19.2% to Rs5.45 billion, while interest expenses rose 49.2% to Rs2.85 billion.

Net earned premiums rose 12.2% to Rs917 million and net fee and commission income rose 41.5% to Rs167 million, interim accounts filed with the stock exchange showed.

There was a sharp increase in net trading income to Rs78 million and a 44% increase in personnel expenses to Rs714 million.

People’s Leasing & Finance’s accounts showed value added tax rose 26.2% to Rs178 million.

Earnings per share for the September quarter were 74 cents. For the six months ended 30 September 2016 EPS was Rs1.44.

Palm oil propels Sri Lanka Watawala Sept profit to Rs309mn

ECONOMYNEXT – Watawala Plantations PLC more than doubled net profit in the September 2016 quarter to Rs309 million from a year ago largely owing to gains from its palm oil business.

Losses in the tea growing business increased while the group’s new dairy business made a modest profit.

According to interim results filed with the stock exchange, group sales rose five percent to Rs1.6 billion in the quarter.

Earnings per share for the quarter were Rs1.31. EPS for the six months ending 30 September 2016 were Rs2.31 with sales up two percent to Rs3.3 billion.

The accounts showed palm oil profits more than doubled in the September quarter while the tea business continued to make losses and dairy yielded a small profit.

“Our company continues to enhance the quality of its teas in order to gain a price advantage, while continuing to increase the palm oil yield,” Watawala Plantations Managing Director Vish Govindasamy told shareholders in a note accompanying the accounts.

Colombo Stock Exchange Market Review – 25th Oct 2016

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Colombo Stock Exchange Trade Summary 25-Oct-2016

Colombo stock market turned green on Tuesday with thinnest market turnover in 31 months. All Share index started the day at 6,417 mark and gained 18.63 index points or 0.29% to end at 6,436.97. High cap constituent, S&P SL20 index slightly gained 0.51 index points or 0.01% to end at 3,587.47.

Price gains in Ceylon Tobacco (closed at LKR 846.80, +2.0%), Sri Lanka Telecom (closed at LKR 37.00, +1.9%) and Bukit Darah (closed at LKR 279.60, +3.8%) drove the index up.

Daily market turnover was LKR 136mn. Renuka Agri Foods top the turnover list with LKR 34mn supported by a single crossing of 8.9mn shares at LKR 3.50 per share. Lion Brewery (LKR 16mn), Hatton National Bank (LKR 8mn), Lanka Orix Leasing & Company (LKR 6mn) and Ceylon Grain Elevators (LKR 5mn) were among top contributors.

Market breadth was positive where out of 207 traded counters, 65 advanced, 53 slipped while 89 remained unchanged.

High investor preference was seen in Watawala Plantations where counter advanced to LKR 20.70, +3.5% supported by favourable earnings release and dividend announcement. Company declared an interim dividend of LKR 0.65 per share. First Capital Holdings, Commercial Credit & Finance and Ceylon Grain Elevators were among highly traded counters.

Further, LKR 6bn debenture issue of Hatton National Bank was oversubscribed within few hours of opening for subscription today. Accordingly, the issue was closed today as per the prospectus.

Foreign investors continued to remain on the buy side for the eleventh consecutive session with a net foreign inflow of LKR 18mn. Foreign participation was 13%. Net foreign inflows were seen in Lion Brewery (LKR 16mn), Commercial Bank (LKR 5mn), Ceylon Grain Elevators (LKR 3mn) while net foreign outflow was mainly seen in Hatton National Bank (LKR 4mn).

Source: LSL

Sri Lankan shares recover from 12-wk low in dull trading

Reuters: Sri Lankan shares edged up on Tuesday from a 12-week closing low hit in the previous session, but trading volume slumped to a more than 2-1/2-year low as investors awaited cues from the government budget and five-year plan as well as corporate earnings.

Sri Lanka's quarterly earnings season started two weeks ago, but most of the firms listed locally reports in late October or early November. The national budget is scheduled to be presented on Nov. 10.

The benchmark index of the Colombo Stock Exchange ended 0.29 percent or 18.63 points higher at 6,436.97, edging up from Monday's close of 6,418.34, its lowest since Aug. 1. The index fell 0.54 percent last week, its second straight weekly loss.

Tuesday's turnover was 135.9 million rupees ($921,355.93), its lowest since March 17, 2014 and lower than a fifth of this year's daily average of around 736.2 million rupees.

"It was a very dull day. It's a waiting game now and nothing is happening," said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

"The equity market is dead and all are waiting for the government's five-year plan and the budget."

Stockbrokers said the market was also digesting political concerns over the resignation of the head of Sri Lanka's anti-corruption body on Oct. 17, a few days after President Maithripala Sirisena implied that the agency was favouring the rival party of his prime minister.

This is likely to delay one of the promises of Sirisena's coalition government, eliminating corruption, and could hurt business confidence, analysts said.

Foreign investors bought a net 17.6 million rupees worth of equities on Tuesday, in the eleventh straight session of net foreign inflows and bringing the total net inflows to 1.23 billion rupees over that period.

They have sold a net 1.74 billion rupees worth of shares this year.

Shares in Ceylon Tobacco Company rose 2 percent, while Carson Cumberbatch Plc rose 1.65 percent. 

($1 = 147.5000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Amrutha Gayathri)

Colombo Stock Exchange Market Review – 24th Oct 2016

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Colombo Stock Exchange Trade Summary 24-Oct-2016

Colombo bourse slumped on week’s opening day as investors remained on the sidelines, awaiting direction from the budget. All Share index lost the way after reaching 6,449 in the opening minutes to closed at 6,418.34, down by 29.19 index points or 0.45%. Blue-chip constituent, S&P SL20 index dipped by 7.63 index points (-0.21%) to end at 3,586.96.

Ceylon Tobacco (closed at LKR 830.20, -2.0%) dragged the index down along with price depreciations in high caps namely, Sri Lanka Telecom (closed at LKR 36.30, -2.2%), Commercial Leasing & Finance (closed at LKR 3.60, -5.3%). Further, Chevron Lubricants declined by 1.8% to LKR 167.00 on the XD day.

Daily market turnover was LKR 301mn. Commercial Bank was the top contributor to the turnover with LKR 35mn followed by John Keells Holdings (LKR 34mn), Lanka Orix Leasing Company (LKR 29mn) and Sampath Bank (LKR 26mn).

Losers offset the gainers 91 to 29, while 77 scripts remained unchanged. High investor activity was witnessed in Lanka IOC and stock closed with loss of 1.5% at LKR 33.50. First Capital Holdings, John Keells Holdings, Lanka Orix Leasing Company and Hayleys Fabrics were among highly traded counters.

Meanwhile, LKR 7bn debenture issue of Commercial Bank was oversubscribed within few hours of opening for subscription today. Accordingly, the issue was closed today as per the prospectus. Lanka Walltiles declared an interim dividend of LKR 2.00 per share.

Foreign investors continued to bag stocks for the tenth consecutive session with a net foreign inflow of LKR 63mn. Foreign participation was 22%. Net foreign inflows were seen in Commercial Bank (LKR 35mn), Sampath Bank (LKR 16mn), Teejay Lanka (LKR 11mn) while net foreign outflow was mainly seen in Hatton National Bank (LKR 5mn).
Source: LSL