Sri Lanka car registrations up in March, Wagon-R leads

ECONOMYNEXT - Sri Lanka's vehicle purchases rose 6.5 percent in March 2018 from a year earlier, with car registration up 107 percent to 5,968 units with Suzuki Wagon-R becoming the market leader after a tax change, an analysis of vehicle registry data shows.

In March 2,380 Wagon-Rs were registered up from only 626 a year earlier, JB Securities, a Colombo-based equities brokerage said.

Indian-made Maruti vehicles were market leaders before Mercantilist crackdown on car imports after the central bank triggered a balance of payments crisis by printing money in 2015 and 2016. A recent tax change made Wagon-Rs more affordable.

"Maruti Alto recorded 17 units in the month, as a point of reference in Sep 2015 there were 7,556 units registered – another case of how government policy can tilt the playing field so precipitously," JP Securities said in a note to clients.

"Under the unit method of duty the taxes on a 660 cc hybrid engine found on most Japanese small cars is LKR 825,000, on an 800cc Alto it is LKR 1.4 million although the landed price of the former is probably 50% less."

Sri Lanka's politicians and bureaucrats, who get tax free and tax slashed cars also cracked down on three wheeler's raising taxes and squeezing credit in the wake of the money printing bout, denying mobility to lower income segments in another vicious intervention, freedom advocates say.

Three wheeler registrations were down 54 percent to 1,525 units in March 2018.

Before the crackdown by Sri Lanka's rulers, people imported between 6,000 to 10,000 three-wheeler units a months. In rural areas the three-wheeler is a the only public transport available.

They were also used by craftsmen like carpenters and masons as personal transport, and small business owners until the crackdown.

Sri Lankan shares hit 5-week closing high in thin trade

Reuters: Sri Lankan shares hit a five-week closing high in thin trade on Tuesday, rising for a fifth straight session, as many market participants stayed away due to extended holidays after the Sinhala-Tamil New Year festival over the weekend, brokers said.

The Colombo stock index ended 0.74 percent higher at 6,544.25, its highest close since March 13. The index gained 0.44 percent last week.

Shares of Distilleries Company of Sri Lanka Plc rose 10.2 percent, while Melstacorp Ltd ended 1 percent higher. Ceylinco Insurance Plc rose 5.2 percent, while fixed line telephone operator Sri Lanka Telecom Plc closed 2.2 percent firmer.

Turnover stood at 315.4 million rupees ($2.02 million), less than this year’s daily average of 1.13 billion rupees.

“Market is up on low volumes. Lack of investors in the market resulted in the low volumes, most investors are on holidays and not active still,” said Dimantha Mathew, head of research, First Capital Holdings.

The market was waiting for some political stability after President Maithripala Sirisena suspended parliament until May 8, brokers said.

Foreign investors bought shares worth a net 9.5 million rupees on Tuesday, but they have net sold 1.36 billion rupees worth of equities so far this year.

The central bank unexpectedly cut its key lending rate by 25 basis points last week, as policy makers sought to revitalise an economy growing at its weakest pace in 16 years and facing heightened political uncertainty. 

($1 = 156.2000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal; Editing by Biju Dwarakanath)

Sri Lanka Nations Trust Bank, SLT, People's Leasing debt issues oversubscribed

ECONOMYNEXT - Sri Lanka's Nations Trust Bank said its 3.5 billion Basel-III-compliant debenture issue was oversubscribed on opening day last Wednesday (11).

Sri Lanka Telecom and finance company People's Leasing and Finance Plc which also opened debenture issues Wednesday, closed the same day after being oversubscribed.

Sri Lanka Telecom said it raised 7 billion rupees and People's Leasing and Finance said it collected 6 billion rupees.

Nations Trust Bank's five-year debentures have a 12.65 percent coupon rate paid every six months or 13 percent interest paid annually.

People's Leasing debentures comprise tenures of four and five years. The four year debenture carries a coupon rate of 12.40 percent and the five year debenture 12.80 percent.

Sri Lanka's Telecom's 10-year debentures have a 12.75 percent coupon rate.

Four year risk-free government bonds closed 9.60/65 in two-way quotes Thursday, a five year bond was quoted at 9.75/85. Ten-year bonds were quoted at 10.10/15, according to Wealth Trust Securities.

Nations Trust last traded at 80.10 rupees, Sri Lanka Telecom at 28.70 rupees and People's Leasing at 15.80 rupees.

Sri Lankan shares hit near 6-week closing high; turnover slumps to 4-year low

Reuters: Sri Lankan shares rose slightly on Monday and posted their highest close in nearly six weeks in light trade, as many market participants were on extended holidays after the Sinhala-Tamil New Year festival over the weekend, brokers said.

Turnover was 101.9 million rupees ($653,833.81), the lowest since March 17, 2014, and less than a 10th of this year’s daily average of 1.16 billion rupees.

“Many people are on vacation and we expect the same to continue until the end of this week,” said Prashan Fernando, CEO, Acuity Stockbrokers.

The Colombo stock index rose for a fourth straight session and ended 0.19 percent higher at 6,496.44, its highest close since Feb. 1. The index gained 0.44 percent last week.

Brokers said the market was awaiting some political stability after President Maithripala Sirisena suspended the parliament until May 8.

The president will reshuffle the cabinet soon, cabinet spokesman Rajitha Senaratne said on Wednesday, after some ministers defected and voted for the no confidence motion against Prime Minister Ranil Wickremesinghe.

Foreign investors sold shares worth a net 8.1 million rupees on Monday, extending the net foreign outflow from equities to 1.36 billion rupees.

Shares of Distilleries Company of Sri Lanka Plc rose 6.2 percent, while fuel retailer Lanka IOC closed 5.2 percent firmer.

The central bank unexpectedly cut its key lending rate by 25 basis points on Wednesday, as policy makers sought to revitalise an economy growing at its weakest pace in 16 years and facing heightened political uncertainty. 

($1 = 155.8500 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Subhranshu Sahu)

Sri Lanka hotel group Citrus Leisure to drop Kalpitiya hotel

ECONOMYNEXT - Hikkaduwa Beach Resorts Plc, a unit of Sri Lanka's Citrus Leisure, said it was seeking shareholder approval to abandon plans to develop an Ayurveda Resort and Spa in Kalpitiya and will use 283.5 million rupees from anpublic offering to settle debts.

A feasibility study on the proposed resort found that Kalpitiya was not ideal location for the project after raising funds from a public offer, the company said.
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"The assessment was that Kalpitiya will not be an attractive location to build a star class resort in the foreseeable future due to several factors including the unavailability of required infrastructure facilities," the company said in a stock exchange filing.

Hikkaduwa Beach Resorts Plc will now dispose its lands and use the funds to develop other projects.

In 2017, the company, a unit of Sri Lanka's Citrus Leisure, absorbed three other listed hotel companies of the group as part of a restructure: Waskaduwa Beach Resort Plc, Kalpitiya Beach Resort Plc and Passikudah Beach Resort Plc.

Hikkaduwa Beach was trading 20 cents lower at 7.10 rupees Friday.

Sri Lankan shares hit near 4-wk closing high in thin trade ahead of holidays

Reuters: Sri Lankan shares on Thursday rose to a near four-week closing high led by financials amid lean trading ahead of the Sinhala-Tamil New Year this week, brokers said.

Markets will be closed for a public holiday on Friday on account of the New Year.

The Colombo stock index ended 0.51 percent higher at 6,483.92, its highest close since March 19. The index has gained 0.44 percent this week.

“It was a lacklustre day though the index rose. Most of the investors are on leave,” said Prashan Fernando, CEO, Acuity Stockbrokers.

“After the holidays, investors will be looking for political stability. It will be the key for investor confidence.”

Cabinet Spokesman Rajitha Senaratne on Wednesday said President Maithripala Sirisena will reshuffle the cabinet soon after some ministers defected the cabinet and voted for the no confidence motion against Prime Minister Ranil Wickremesinghe.

The day’s turnover was 356.9 million rupees ($2.29 million), less than a third of this year’s daily average of 1.16 billion rupees.

Foreign investors sold shares worth a net 102.1 million rupees on Thursday, extending the net foreign outflow from equities to 1.36 billion rupees.

Market sentiment improved after Prime Minister Ranil Wickremesinghe survived a no-confidence motion last week, dealers said.

Capital Trust closed 4.3 percent higher, while top conglomerate John Keells Holdings closed 0.5 percent stronger.

The central bank unexpectedly cut its key lending rate by 25 basis points on Wednesday, as policy makers sought to revitalise an economy growing at its weakest pace in 16 years and facing heightened political uncertainty.

($1 = 155.6000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Vyas Mohan)

Colombo’s Port City ready for investors

LBO - CHEC Port City Colombo (Pvt) Ltd., presented the Development Control Regulations (DCR) for the Colombo Port City project.to the authorities, Tuesday.

“This is a signal for the marketing team to sell it as real estate,” Minister of Megapolis and Western Province Development Champika Ranawaka said at the presentation ceremony in Colombo.

“The DCR will benchmark standards for the the rest of country as well.“

The DCR was prepared by Surbana Jurong, a Singaporean urban design consultancy and Atkins, a UK-based engineering consultancy.

When complete the city will have reclaimed 269 hectares with 116 hectares being handed over to China Communications Construction Company (CCCC), which is the parent company of China Harbour Engineering Company (CHEC).

The remaining land, which will be owned by the Sri Lankan Government and will be divided with 62 hectares to be used to set up a financial city and 91 hectares to be used as public spaces.