India’s Oberoi hotels group keen to return to Sri Lanka

ECONOMYNEXT - India’s Oberoi hotels group wants to return to Sri Lanka and is interested in partnering with owners of island properties that are well located, a senior company official said.

“Anyone wants to speak to us of great locations they have, we would love to partner with them,” Kapil Chopra, President of The Oberoi Group told a tourism forum in Colombo.

“We’re open to equity partnerships, management contracts, we’re open to buying out owners,” he said.

While historically the Oberoi group has taken equity stakes in hotels they operate, it is also happy to do pure management contracts, Chopra said.

The Oberoi group built a hotel in Colombo in the 1970s but subsequently quit the island in the middle of an ethnic conflict whose end in 2009 led to a boom in arrivals.

Chopra said Sri Lanka has “room for growth” having received almost 1.8 million tourists in 2015 compared with Thailand’s 25 million and India’s seven million.

Almost a quarter of visitors were staying for a week or two “which means a good length of stay,” he told the Tourism, Hotel Investment & Networking Conference (THINC) organised by HVS, a hospitality consulting firm.

“And real estate valuations (in Sri Lanka) are a fraction of what they are in India. These are three things that make it a very attractive market for us.”

For the Oberoi group location of hotels was critical.

“We want each one of our hotels to be unique – we’re a luxury operator. We cannot compromise on location because we can’t compromise on the overall experience.”

Sri Lanka's Dialog may buy Airtel unit with share swap: report

ECONOMYNEXT - Sri Lanka's Dialog Axiata may acquire a unit of Bharti Airtel in the island by issuing its own stock for shares of the smaller player, a media report said.

India's Economic Times newspaper citing unnamed sources said the stock could be issued to a Singapore based unit of Airtel and negotiations were ongoing.

Axiata had already merged its Bangladesh units with Airtel.

Economic Times said Airtel said there was no development to report now and Dialog had declined to comment on "news which are of a speculative nature."

The reports said Dialog had 10 million customers and Airtel 2 million, raising concerns over competition.

Sri Lanka's Telecom minister Harin Fernando said earlier this month that authorities had been sounded out over the take-over.

However critics say Sri Lanka's telecom regulator had also already supported anti-competitive practices and stifled competition with floor rates.

Sri Lanka's Sunshine Holdings Dec net up 69-pct

ECONOMYNEXT - Profits at Sri Lanka's Sunshine Holdings Plc, which has interests in consumer goods, farming, pharmaceuticals and power rose 69 percent to 175 million rupees in the December 2015 quarter from a year earlier.

The group reported earnings of 1.30 rupees per share. In the nine months to December the group reported earnings of 3.77 rupees per share, on profits of 508 million rupees, which grew 25 percent.

The group said revenues grew 5 percent to 4.2 billion rupees, costs rose at a slower 4 percent to 3.1 billion rupees allowing gross profits to grow 10 percent to 1.13 billion rupees. In 2015, there was a one-off 61 million rupee write off of goodwill.

In the 9 months gross profits rose 13 percent to 3.1 billion rupees.

Chairman Vish Govindasamy, said healthcare revenues grew 17.2 percent to 5.3 billion rupees and after tax profits grew to 264 million rupees from 174 million rupees.

Consumer goods revenues grew 19.7 percent to 2.5 billion rupees and after tax profits grew to 343 million rupees from 245 million rupees.

Agricultural revenues fell 12.6 percent to 4.6 billion with tea and palm oil prices falling, but after tax profits grew to 450 million rupees from 409 million helped by a focus on quality, Govindasamy said.

In Sri Lanka palm oil prices are kept up with import duties.

Power sector revenues had grown to 104 million rupees from 88 million with better rainfall.

Sri Lanka Hayleys group December quarter net down 27-pct

ECONOMYNEXT - Sri Lanka Hayleys group said December 2015 quarter net profit fell 27 percent to 534 million rupees from a year ago,

Sales were virtually flat at 23.6 billion rupees, according to unaudited accounts filed with the stock exchange.

Earnings per share for the quarter were 7.12 rupees.

EPS for the nine months ending December 31, 2015 were 22.48 rupees with net profit flat at 1.7 billion rupees and sales also flat at 68 billion rupees.

“The group’s results reflect the challenges faced by the plantations and hand protection sectors during the nine months in review,” a statement said.

“The plantation sector faced a number of challenges during the year including the global commodities crash which caused lower tea and rubber prices , and lackluster demand from traditional markets, compounded by inclement weather in Sri Lanka.”

Hayleys glovers business also faced “significant mixed challenges” from the global market as Sri Lanka faced relatively higher input prices compared to competing countries, the statement said.

“The company has already initiated a number of projects to move into more value added hand protection products to overcome the price sensitivity in the mass produced glove segments.”

Sri Lankan stocks end at over 3-wk low on weak global cues

Reuters: Sri Lankan shares fell for the fourth straight session on Thursday to end at a more than three-week low, as weaker global markets weighed and as investors stayed off risky assets on concerns over rising domestic interest rates.

Turbulence tore through global markets on Thursday as investors sought the safety ofJapanese yen, gold and top-rated bonds while dumping U.S. dollars on bets the Federal Reserve could be done with raising interest rates.

Sri Lanka's main stock index ended 0.78 percent or 49.58 points weaker at 6,314.82, its lowest close since Jan. 20.

"Weak economic conditions are the main cause for the lack of confidence among the investors, and also the investors are expecting interest rates to go up further," said Dimantha Mathew, research manager at First Capital Equities (Pvt) Ltd.

The key index has fallen 8.4 percent this year through Thursday.

Yields on t-bills rose between 8 and 17 basis points at a weekly auction on Wednesday, with the 182-day and the 364-day t-bill yields rising to over two-year highs, signalling a further rise in market interest rates.

Some investors are shifting to fixed interest rate-bearing assets due to a gradual rise in interest rates, analysts said.

Foreign investors were net buyers of 22.2 million rupees (about $154,273) worth shares on Thursday, but they have been net sellers of 188.7 million rupees worth of equities so far this year.

Turnover was 207.2 million rupees, less than a third of this year's daily average of 749.99 million rupees.

Shares of conglomerate John Keells Holdings Plc fell 2.4 percent, while Hemas Holdings Plc lost 4.9 percent and the biggest listed lender Commercial Bank of Ceylon Plc dropped by 1.40 percent. 

($1 = 143.9500 Sri Lankan rupees) 

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

India tops tourism arrivals overtaking China

Tourist arrivals to Sri Lanka in January 2016, saw a 24.3% increase as against the previous year’s corresponding month. By end January there were 194,280 arrivals.

After a long period India once again topped the arrivals list overtaking China. The number of arrivals from India grew 26 percent to 28,895 in January 2016 from a year ago while that from China. Chinese arrivals recorded 26,083 which is an all time record 122.3%. United Kingdom remained the biggest contributor from Europe with a 21% increase and accounting 16,253 visitors last month while Germany grew 23% to 12,760. Gulf arrivals was disappointing accounting 10,109.

Despite direct air services Kuwait arrivals saw a minus growth. However in comparison to 2015 January it has seen a 14% increase. Both Thailand and Pakistan arrivals also saw a major decline with arrivals dropping.

Also despite the former Sri Lanka Tourism Promotions Bureau officials spending millions of rupees and conducting road shows and going on tours,the Russian market also saw a dip in arrivals. (SS) 

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Sri Lanka’s John Keells Hotels December net down 13-pct

ECONOMYNEXT – Sri Lanka’s John Keells Hotels said net profit fell 13 percent to 365 million rupees in the December 2015 quarter from a year ago.

Sales of the company, a unit of the John Keells Holdings group, were virtually stagnant at 2.8 billion rupees, interim results filed with the stock exchange showed.

Sales were stagnant at both Sri Lankan and Maldivian hotels but profits were up slightly in the Sri Lankan hotels and down in the Maldivian resorts.

Earnings per share for the December quarter were 25 cents.

EPS for the nine months ending December 2015 fell to 58 cents from 61 cents with net profit down five percent to 846 million rupees and sales virtually stagnant at eight billion rupees from a year ago.