Sri Lanka SEC approves All or None blocks in trading of stocks

(LBO) – Sri Lanka’s securities regulator has approved the Automated Trading System rules and corresponding amendments to the Central Depository Systems rules developed by the CSE to facilitate trading of All or None (AON) blocks.

AON is an instruction used on a buy or sell order that instructs the broker to fill the order completely or not at all. If there are not enough shares available to fill the order completely, the order is canceled when the market closes.

An AON order is considered a duration order because the investor provides instructions to the trader about how the order must be filled, which impacts how long the order remains active.

The SEC said in a statement that the ATS is designed to match buy and sell orders placed by stock broker firms of the CSE.

Accordingly, several mechanisms can be used to transact securities including the Normal Order Book, Crossings and the AON facility.

The AON order facility is designed to facilitate the sale or purchase of a large quantity of securities. The minimum number of securities required for an AON Block shall be at least 10 percent of the number of securities issued.

“In the wake of the Government’s programme to restructure SOEs, the AON can be a medium through which strategic stakes in Government owned entities can be transacted in a transparent manner in a competitive environment,” the SEC said.

“The AON method will assist in the disposal of such assets at the optimum price.”

The SEC said the AON method has many advantages over using the Normal Order Book and Crossings mechanism.

“Transactions using the AON method will be open for bidding for 3 market days whereas there is no such requirement either in the Normal Order Book or the Crossings mechanism,”

“Further, transactions using the AON method will have a lower systemic risk since clearing and settlement of transactions will take place on a defacto delivery vs payment basis.”

Another facility provided in the AON method is the facility for a consortium of buyers to bid for the parcel collectively which will help improve liquidity.

Sri Lankan shares edge up; beverage, telecoms lead

Reuters: Sri Lankan shares closed slightly firmer on Monday, after posting a more than three-week closing low in the previous session, with beverage and telecom stocks driving the gains.

However, investor sentiment continued to remain low amid concerns about rising interest rates.

The Colombo stock index ended up 0.26 percent at 6,117.19, after posting its lowest close since Feb. 9 on Friday. It shed 0.6 percent last week in its second straight weekly decline.

Foreign investors were net buyers of shares worth 384.7 million rupees ($2.55 million) on Monday, extending the year-to-date net foreign inflow to 1.35 billion rupees worth of equities.

Turnover was 711.9 million rupees, more than this year's daily average of 680.1 million rupees.

"Some crossings boosted the turnover. The good sign is we are seeing continued foreign buying these days," said Dimantha Mathew, head of research, First Capital Equities (Pvt) Ltd.

"Local investors are on the sidelines, mainly because of the high interest rates and economic uncertainty."

Shares in Ceylon Cold Stores Plc jumped 6.12 percent, Lion brewery (Ceylon) Plc rose 6.27 percent, Ceylon Tobacco Company Plc gained 0.71 percent, and Sri Lanka Telecom Plc climbed 2.41 percent.

Yields on treasury bills have risen to a more than four-year high since October, while the central bank has kept key policy rates on hold. 

($1 = 151.0000 Sri Lankan rupees) 

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

Sri Lanka February tourist arrivals down 0.1-pct

The number of tourists visiting Sri Lanka down 0.1% in February 2017 from a year ago with strong gains seen from traditional markets like United Kingdom and new markets India maintaining their growth momentum.

Sri Lanka received 197,517 visitors in February and tourist arrivals in the first 2 months of the year have risen 6.4% from the year before, the tourist office said.

India remained the main market in February 2017.

Sri Lanka's Sampath Bank flags competition from telcos

ECONOMYNEXT - Sri Lanka's Sampath Bank Plc has drawn attention to the threat banking faces from competition from mobile phone companies which are offering payment and other transaction services.

“The year ahead is likely to present an uncertain operating environment,” Sampath Bank Managing Director Nanda Fernando told shareholders in the firm’s annual report.

“We are also likely to experience strong competitive pressures, not only from peers in the banking industry, but also from telcos that appear to be intruding into our territory.”

Nonetheless, Fernando said, Sampath Bank stands firm in its determination to maintain its growth momentum, both in terms of the top line as well as the bottom line.

Fernando said Sampath Bank was focusing in improving its digital online banking facilities to cater to changing technology and consumer trends.

“Additionally, cost management and the promotion of electronic delivery channels will continue to be absolute priorities in our medium term growth agenda,” he said.

Norway's Norges Bank fund invests US$65mn in Sri Lanka stocks

ECONOMYNEXT - Norges Bank Investment Management (NBIM), a sovereign wealth fund in Norway has invested 65 million US dollars in Sri Lanka stocks over the past two years, the Royal Norwegian Embassy said.

NBIM, which comes under the Norges Bank, the country's central bank, has started by investing 31 million dollars in 2016 and doubled it to 65 million dollars in 2016.

"It must also be noted that the Norwegian Central Bank is completely independent from the Norwegian Government, therefore, this fund is not used as an instrument of the Norwegian government’s foreign policy, or as a tool in foreign aid," the statement said.

"The only mandate for the Norwegian Central Bank is to safeguard and ensure further growth of the fund.

"Therefore, the investments in Sri Lanka from the Norwegian sovereign wealth fund is an indication of the investor confidence and the potential investment opportunities that are available in the market."

The Norwegian Government Pension Fund Global is a sovereign wealth fund, which manages oil and gas profits of the government, where real returns are used for budgetary spending.

It has 890 billion dollars in assets, (about 1.3 percent of world stocks) of which 16 percent is in Asia. Japan has 9 percent, China 2.7 percent and India 1 percent. About 0.6 percent is in Africa.

Europe and North America has 78 percent.

"However, this is likely to change as the Norwegian Central Bank has indicated that they will shift more of their investments toward emerging economies in the future," the statement said.

Sri Lanka Telecom December quarter loss turns to profit

(LBO) – Sri Lanka Telecom group, the island’s largest fixed line operator, said profits rose to 124 million rupees in the December quarter from 383 million rupee loss reported a year earlier.

The group’s interim accounts reported earnings of 0.07 rupees per share for the quarter against a loss of 0.21 rupees per share recorded a year ago.

In the 12 months to December, the group reported earnings of 2.65 rupees per share on total profits of 4.7 billion rupees.

The company’s stock was last traded at 33.60 rupees on Wednesday.

Sri Lanka Telecom revenues in the quarter were 18.1 billion rupees, up six percent from 2015, and operating costs rose three percent to 13.9 billion rupees.

During the year ended December 2016, the group has acquired assets at a cost of 31,069 million rupees excluding capitalized borrowing costs — as at 31 December 2015 it was 12,390 million rupees.

No dividend was declared by the company for the quarter ended 31 December 2016 though a dividend of 1,606 million rupees was paid 24 May 2016 for the financial year ended 31 December 2015.

Percentage of public holding as at 31 December 2016 is 5.52 percent and number of shareholders representing the public holding is 12,213.

Mobitel (Pvt) limited acquired 87.59 percent of shares of E-channeling through a voluntary offer for a total consideration of 641.85 million rupees.

The transaction of the acquisition was completed on 14 September 2016. E-channeling has been consolidated as a subsidiary for the financial year ended 31 December 2016.

The group is primarily involved in providing broad portfolio of telecommunication services across Sri Lanka.

The services provided by the group also include internet services, data services, domestic and international leased circuits, broadband, satellite uplink, maritime transmission, IPTV service and directory publishing service.

Sri Lankan shares edge up on foreign investor buying

Reuters: Sri Lankan shares closed marginally higher on Thursday after posting a near three-week closing low in the previous session, as foreign investors bought recently battered stocks while concerns about rising interest rates continued to hurt investor sentiment.

The Colombo stock index ended up 0.09 percent at 6,127.11, after closing at its lowest since Feb. 9 on Wednesday.

Foreign investors were net buyers of 292.6 million rupees ($1.94 million) worth of shares, extending the year-to-date net foreign inflow to 892.2 million rupees worth of equities.

Turnover was 783.9 million rupees, more than this year's daily average of 666.6 million rupees.

"Market continues to move sideways but today we have seen some institutional and foreign buying," said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

Sri Lanka Telecom Plc ended 3.87 percent higher after reporting a group net profit of 289 million rupees for the December quarter, compared with a net loss of 157 million rupees a year earlier.

Trans Asia Hotels Plc jumped 8.12 percent, while Commercial Leasing & Finance Plc rose 3.45 percent.

Yields on treasury bills have risen to a more than four-year high since October, while the central bank has kept key policy rates on hold. 

($1 = 151.1000 Sri Lankan rupees) 

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