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Ceylon Dollar Bond Fund gains on recovering Sovereign Bonds

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The Covid-19 financial crisis led to a crash in SL Sovereign Bond prices from $ 100 to an all-time low of $

48.15 in May as investors ran to the safety of US treasuries exiting Asian bonds. The run was common to all Asian Bonds including SL sovereign Bond (ISB).

Most other Asian ISBs had recovered except for Sri Lankan sovereign bonds due to concerns about SL ability to repay the $ 1 billion ISB maturity on the 4th of October 2020. SL was downgraded to B- by the rating agencies (Fitch, S&P & Moody’s) in April 2020 while some international media articles discussed the possibility of Sri Lanka defaulting.

However, with Sri Lanka receiving confirmation of currency swaps for $ 3 billion with India ($ 1.4 bn) and China ($1.63 bn) in July, while the Trade Deficit halved by 50% in May 2020 (YoY). The government has also entered into a $ 1 billion Repo (repurchase agreement) with US although the facility has not been drawn yet. The Central Bank has specifically committed to repay the $ 1 billion sovereign bond maturity in October out of the foreign currency reserves. The above factors along with Sri Lanka’s success in battling the epidemic has increased the confidence of foreign investors. As a result, the 2030 maturity sovereign bond price has increased to $ 74.5 reflecting a yield of 12.1% p.a on July 31, 2020.

Once Sri Lanka honours the $ 1 billion repayment on October 4th, 2020, analysts expect foreign investor confidence to return to SL sovereigns. As a result, investors can expect substantial capital gains in addition to the yield of 12.1% due to an increase in sovereign bond prices.

The Ceylon Dollar Bond Fund (CDBF) invests exclusively in Sri Lanka government guaranteed dollar Sovereign Bonds and Development Bonds. Ceylon Asset Management competes with international USD bond managers in operating the Ceylon Dollar Bond Fund (CDBF), Sri Lanka’s first international sovereign bond fund that navigates global market conditions. The fund reported a performance of 10.3% in US dollar during 2019.

The CDBF is managed by Ceylon Asset Management (CAM) while Deutsche Bank AG serves as the Trustee and Custodian of the fund. CAM is an associate company of Sri Lanka Insurance Corporation Ltd.

Local individual investors who hold a Personal Foreign Currency Account (PFCA), corporate investors with a Business Foreign Currency Account (BFCA) and Foreign Investors are eligible to invest in the fund. Investors can exit at any time without penalties, and repatriate dollars to the originating bank account.

The CDBF is the only dollar-denominated Unit Trust in Sri Lanka licensed by the Securities and Exchange Commission (SEC) and approved by the Central Bank.

Past performance is not an indicator of future performance, investors are advised to read and understand the contents of the explanatory memorandum on www.ceylonam.com.

 



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Galadari Colombo awarded ‘SLIM People’s Hotel Brand of the Year 2021’

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The Galadari Colombo was given a thumbs up from the people as the People’s Hotel Brand of the Year for the second time running at the recently concluded SLIM (Sri Lanka Institute of Marketing) People’s Awards 2021.

The uniqueness of the SLIM People’s Awards is the fact that it is awarded by the public which shows the popular choice of the Sri Lankan people.

This is the 15th successful running of the much-anticipated event conducted by SLIM in association with Nielsen which is globally renowned for its measurement and consumer insights.

Having stood the test time of time in the hospitality industry for more than 3 decades the Galadari Colombo is hopeful to remain in the hearts of its people as a brand that is trustworthy and dedicated to service.

 

 

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Expatriates’ organization painting competition for Sri Lankan children from care homes highlights close India-Sri Lanka ties

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Celebrating 75 years of India’s independence in Sri Lanka, Sri Lankan children from care homes converged in Colombo from all across Sri Lanka over 10-11 April 2021 for the final round of the nationwide painting competition organized by Colombo Expatriates Cultural Association (CECA) – a voluntary organization of expatriates consisting of mainly Indians – with support of the High Commission of India, Ministry of Education of government of Sri Lanka and several other partners.

Prof. G.L Peiris, Minister of Education was the Chief Guest and Gopal Baglay, High Commissioner of India was the Guest of Honour at the final round. Several other dignitaries including State Minister Piyal Nishantha were also present. The dignitaries lauded the effort as a shining example of strong people-to-people ties between India and Sri Lanka and stressed the enormous significance of the enriching experience for the children.

The competition was held in three categories – Sub Junior, Junior and Senior. The first round of the competition had seen enthusiastic participation of 4,375 students from child care homes across Sri Lanka. Contestants from all provinces who had produced sixty best paintings were invited along with one care-giver for the final round held in Colombo on April 10 at Hotel Taj Samudra. While top three winners in all the three categories were awarded SLR 100,000, SLR 75,000 and SLR 50,000 respectively in addition to various other gifts, certificates and medals, all the 60 finalists received cash awards, desktop computers, and other gifts contributed by various sponsors.

The event also formed part of ‘India @ 75’ celebrations in Sri Lanka which comprise events and activities in the run up to completion of 75 years of India’s Independence in August 2022. Prime Minister of India Shri Narendra Modi had launched these celebrations in India on March 12 2021, 75 weeks before the 75th Anniversary of Independence. In Sri Lanka, formal launch of these celebrations had taken place on April 9 2021 with the inauguration of ‘India Corner’ at the Nagananda Institute for Buddhist Studies.

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Chrissworld to raise Rs. 56.25 million through IPO

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By Hiran H.Senewiratne 

Chrissworld Ltd. (CWL), an SME company  engaged in the provision of third-party logistics (3PL) services, is gearing to raise up to Rs. 56.25 million via an initial public offering (IPO) on the Colombo Stock Exchange, sources said.

The company plans to offer 7,500,000 Ordinary Voting Shares for subscription at Rs. 7.50 per share. The subscription will open on April 27, with Atara Capital Partners representing the company as managers to the issue.

Meanwhile, the CSE noted in a statement that it has approved an application submitted by Chrissworld Ltd. for the listing of its Ordinary Voting Shares by way of an offer for subscription on the Empower Board of the CSE.

The company,  starting off with Rs. 6 million capital in 2019, expanded its capital to Rs. 22.5 million and projects to obtain Rs. 79 million after the IPO.

Chrissworld will be earmarking milestones with the IPO as the first to be listed on the Empower Board, CSE’s newest listing platform, dedicated to SMEs. Further, Central Depository Systems (Pvt.) Ltd., a subsidiary company of CSE, will step in for the first time as the registrar to the issue.

Amid those developments the CSE  started  on a bullish note yesterday and during the latter part of the day with heavy retail investor participation the CSE witnessed a bullish trend. It is said that manufacturing sector counters became the most popular stocks during the day. Notable price appreciation was reported in Hayleys Group, Royal Ceramic Group and  Distilleries.    

Both indices moved upwards. The All Share Price Index went up by 100.10 points and S and P SL20 rose by 49.18 points. Turnover stood at Rs. 3.51 billion with a crossing. The crossing was reported in JKH, which crossed 1.32 million shares to the tune of Rs. 199.3 million and its share price was Rs. 151.

In the retail market, companies that mainly contributed to the turnover were; Royal Ceramic Rs. 511.2 million (1.46 million shares traded), Expolanka Holdings Rs. 359.9 million (4.5 million shares traded),  Hayleys Group Rs. 359.9 million (4.5 million shares traded), Dipped Products Rs. 321 million (5.5 million shares traded), JKH Rs. 290 million (1.9 million shares traded), and Haycarb Rs. 177 million (1.5 million shares traded). During the day 87.8 million share volumes changed hands in 23900 transactions.

Hayleys shares appreciated by Rs. 6 or eight percent. Its shares started trading at Rs. 75.90 and at the end of the day they moved to Rs. 82. Royal Ceramic shares appreciated by Rs. 13.5 or nine percent. Its shares started trading at Rs. 328.25 and at the end of the day they moved to Rs. 358.75. Expolanka shares appreciated by Rs. 2.70 or five percent. Its shares  started trading at Rs. 49.70 and at the end of the day they shot up to Rs. 52.40 and Distilleries shares appreciated by 70 cent or 3 percent from Rs. 20.20 to Rs. 20.90  

Sri Lanka’s rupee quoted steady at 202.00/203 to the one month US dollar Monday, while gilt yields remained unchanged, dealers said.

The rupee last closed in the one-week forward market at 202/203 to the US dollar on Friday. Sri Lanka markets were dull as seasonal bliss kicks in.

 

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