By Hiran H. Senewiratne
Two newly listed companies, Cooperative Insurance and hSenid, saw their share prices appreciate significantly at the CSE yesterday, which is a notable occurrence, stock market analysts said.
Further, plantation sector companies were able to maintain their momentum as on the previous day. But there are notable activities happening in tourism/hotel sector counters due to the significant increase in tourist arrival to Sri Lanka from December 1 to 26th this year, amounting to 70000 arrivals, stock market analysts said.
Amid those developments both indices moved upwards. The All- Share Price Index went up by 104.5 points and S and P SL20 rose by 23.7 points. Turnover stood at Rs 6.5 billion with five crossings. Those crossings were reported in Commercial Bank, which crossed 3.9 million shares to the tune of Rs 308 million, its shares traded at Rs 79, Melstacorp two million shares crossed for Rs 110 million, its shares traded at Rs 55, LOLC Holdings 32000 shares crossed for Rs 37.3 million, its shares traded at Rs 1165.75, Royal Ceramic 500,000 shares crossed for Rs 37.2 million, its shares traded at Rs 74.40 and Bukitdarah 50000 shares crossed for Rs 20 million, its shares fetching Rs 400.
In the retail market, seven companies that mainly contributed to the turnover were; Expolanka Holdings Rs 815 million (2.2 million shares traded), Browns Investments Rs 546 million (37.8 million shares traded), Cooperative Insurance Rs 407 million (92.5 million shares traded), hSenid Rs 410 million (12.4 million shares traded), Lanka IOC Rs 179 million (2.5 million shares traded), Elpitiya Plantations Rs 179 million (1.2 million shares traded) and Richard Peiris Rs 161 million (6.4 million shares traded). During the day 509 million share volumes changed hands in 59000 transactions.
Price appreciations were noted in two newly listed companies. One was Cooperative Insurance, where the share price appreciated by 30 per cent or Rs 1.10. Its shares shot up to Rs 4.70 from Rs 3.60. The second was hSenid, whose share price appreciated by 16 per cent or Rs 4.50. Its share price shot up to Rs 32.80 from Rs 28.30. Further, Elpitiya Plantations share prices appreciated by Rs 21.25 or 16 per cent. Its share price shot up to Rs 156 from Rs 134.
Meanwhile, LOLC General Insurance, which oversubscribed 12 times, will be listed in the Divisavi Board today. The company will issue 1.2 billion shares, out of which 120 million will be offered to the public at Rs 7.90 a share to raise Rs 948 million.
It said high net worth and institutional investor participation was noted in Melstacorp, Commercial Bank and Sinhaputhra Finance. Mixed interest was observed in Expolanka Holdings, hSenid Business Solutions and Browns Investments, while retail interest was noted in SMB Leasing voting and non-voting and Industrial Asphalts.
Sector-wise, plantation stocks witnessed more traction during the session and ended sharply higher while Food, Beverage & Tobacco, Diversified Financials, Capital Goods and Banks sectors led activity, collectively accounting for 72.7% of turnover. Activity continued strong while the breadth of the market turned positive with 124 gainers and 91 decliners.
Separately Kelani Valley Plantations, Haycarb and Singer Sri Lanka announced their interim dividends of 25 cents, 75 cents and 35 cents per share respectively.
Yesterday the US dollar was quoted at Rs 201.96, which was the Central Bank controlled price. The actual price of the dollar is now touching Rs 250, market sources said.
Seven factors of concern at upcoming Monetary Policy Review
by Sanath Nanayakkare
The Central Bank of Sri Lanka (CBSL) is scheduled to announce its latest monetary policy review on 20th January 2022, with all eyes on dwindling foreign reserves and foreign currency exchange in the country.
In this context, First Capital Research has named 7 factors of concern that could be taken into account at the upcoming monetary policy review. They are as follows.
* Foreign Reserves USD 3.1 billion – Dec 2021
* Inflation CCPI 12.1% – Dec 2021
* GDP Growth -1.5% – 3Q2021
* Private Credit LKR 60.5 billion – Nov 2021
* 03M T-Bill rate 8.38% as at 12.01.22
Liquidity and CBSL Holdings LKR -364.0 billion and LKR 1.42 trillion
Balance of Trade (BOT) and Balance of Payment (BOP) USD -6.5 billion and USD -3.3 billion for Jan-Oct 21
First Capital Research’s Policy Rate Forecast – Jan 2022-Apr 2022 notes that they believe the CBSL may highly consider tightening the monetary policy rates in this policy review but given the concerns over economic growth, there is a probability of 40% for CBSL to maintain its policy stance at current levels.
“With high frequent indicators improving in line with expectations, we have eliminated any probability of a rate cut. We expect a continued increase in probability for a rate hike in order to prevent overheating of the economy amidst the given fiscal and monetary stimulus,” they said.
As per First Capital’s view, CBSL either can choose to hike policy rates by 50bps or 100bps or hold policy rates steady, while a rate cut is off the table due to the high debt repayment and the high domestic borrowing requirement.
First Capital believes that there is a 60% probability for a rate hike due to the remedial actions required in achieving external stability.
However, there is also a 40% probability to maintain the policy rates at its current level in order to further improve the high frequency indicators.30%, they noted.
Sri Lanka’s dash brand enters international markets
Multichemi International Ltd, which manufactures and distributes a wide range of products under dash, one of Sri Lanka’s leading detergent and household care brands, has begun exporting its products to several international markets in Asia and Oceania, with plans also to enter Africa. The dash brand includes a wide range of products in car care, household care, home fragrances and laundry care sectors. Multichemi International Ltd, which has been awarded ISO 9001:2015 certification, is a Sri Lankan pioneer in environment-friendly cleaning products, having launched the country’s first biodegradable, safe cleaning products over 28 years ago.
Amila Wijesinghe, General Manager of the Company said,”Having conquered the domestic market, we are now ready to capture the international market. We are confident that our products which are of high quality will receive a good demand overseas as well. The feedback we have received so far from our overseas customers is extremely encouraging. We are dedicated to taking our products to the international market, to bring in foreign currency to the country and help uplift the economy”,
Janaka Abeysinghe appointed SLT CEO
Sri Lanka Telecom PLC has announced the appointment of Janaka Abeysinghe as its Chief Executive Officer (CEO) with effect from February 1, 2022.
The incumbent CEO Kiththi Perera will be overseas on leave for a period of two years to pursue higher studies, according to a stock market filing by the company.
Abeysinghe joined SLT in 1991. In his present role, he leads the enterprise and wholesale business of SLT that provides integrated voice and data solutions to enterprises, government institutions, domestic telco operators and global wholesale carriers.
In his career at SLT spanning 29 years, he has held a number of senior positions, including general manager Enterprise and International Sales and has extensive experience in the areas of Enterprise Digital Services, Enterprise Communications Solutions, Data Communications, Business Development, Domestic and International Switching Operations and Global Wholesale Voice & Data Business.
He holds a Master’s Degree in Electrical and Computer Engineering from the University of Kansas, USA and a BSc degree in Electronics and Telecommunications Engineering with a First Class Honours from the University of Moratuwa.
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