7-Jul-2017 Focus: Green end for the week Market started the week on a red note and indices moved between gains and losses during the week to mark a green end. Foreigners remained as net foreign buyers in all five days of the week. Highest turnover was recorded on Friday pertaining to crossings recorded by LION,BREW and JKH. Diversified Holdings sector contributed mostly to the market turnover during the week while Plantations sector became the highest gainer (+5.12%). RICH, CARG and LOLC moved up ASPI by 18.93 points while AHPL, NEST and CCS dragged down the index by 12.41 points. During the week ASPI was down by 10 points while S&P SL 20 was also down by 25 points. Market Indicators This Week Last Week % Change YTD ASPI 6,738 6,747-0.14% 8.79% S&P SL 20 3,909 3,934-0.62% 12.57% For. Pur(LKR Mn) 2,054 2,684-23.45% 64,835 For.Sales(LKR Mn) 1,503 1,625-7.45% 42,285 Mkt Cap.(LKR Mn) 3,055,789 3,041,228 0.48% 15.08% Turnover (LKR Mn) 3,478 4,600-24.39% Volume (Mn) 148.75 214.83-30.76% PE 11.54 11.50 0.35% PBV 1.46 1.52-3.80% Daily avg.turnover(lkr Mn) 696 1,150-39.51% Rupee slightly depreciated during the week closed at LKR 153.70 per USD. One-year T-bill rate slightly decreased to close at 10.45%. Gold prices decreased to close at 1221.60$/Oz and oil price decreased to close at 44.39$/Barrel. Daily avg.for.pur(lkr Mn) 411 671-38.76% Daily avg.for.sales(lkr Mn) 301 406-25.96% YTD Net Foreign inflow/(outflow) - LKR Bn Top 5 Turnover ASPI, S&P SL 20 and Volume Company This Week Last Week % Change Price (LKR) 22.73 7,000 6,500 6,000 5,500 5,000 4,500 4,000 3,500 3,000 2,500 JKH.N 922,074,040 931,730,296-1% 178.00 RICH.N 215,737,984 38,412,418 462% 12.60 LION.N 156,370,815 256,782 60796% 445.00 HEMS.N 151,760,827 363,902,882-58% 153.00 BREW.N 147,651,000 468,000 31449% 115.00 Top 5 Gainers Company This Week Last Week % Change Volume ASPI S&P SL 20 UDPL.N 31.60 19.50 62% 33,599 BLUE.X 0.50 0.40 25% 597,441 TAP.N 5.50 4.40 25% 629,098 ASPI Contributors for the Week RICH.N 12.60 10.20 24% 18,490,555 Points RICH.N 12 LLMP.X 1.60 1.30 23% 1,210,186 10 8 6 4 2 CARG.N LOLC.N BIL.N LIOC.N Top 5 Losers Company This Week Last Week % Change Volume KZOO.N 552.90 692.60-20% 23,269 KDL.N 50.20 59.00-15% 623 0-2 -4-6 JKH.N SLTL.N CCS.N NEST.N AHPL.N NIFL.N 43.10 47.40-9% 2,594 MFL.N 12.00 13.10-8% 12,113 TFC.X 2.20 2.40-8% 185,694 Top 5 Sector Gainers Research Contact Sector This Week Last Week Gain % Shehan Bartholomeuz +94 011 5889835 PLANTATIONS 891.12 847.70 5.12% Gayan Rajakaruna +94 011 5889837 INVESTMENT TRUST 13,432.51 12,939.17 3.81% Hiruni Perera +94 011 5889809 POWER & ENERGY 135.70 132.05 2.76% STORES SUPPLIES 27,640.74 26,907.09 2.73% Important Disclosure and Contact Details: Page 5 FOOTWEAR TEXTILE 1,008.28 990.34 1.81%
LKR per kg LKR//US $ % Billions Sri Lanka Equity Turnover and Foreign Trading Local Market 1.1 0.9 ASPI S&P SL 20 % change 6,738-0.14% 3,905-0.71% 0.7 AWPR (Weekly) 10.15% 1.50% 0.5 USD:LKR 153.70 0.22% 0.3 0.1 JPY:LKR EUR:LKR 1.35-0.91% 175.40 0.10% -0.1 7/3/2017 7/4/2017 7/5/2017 7/6/2017 7/7/2017 Foreign Purchase Foreign Sales Turnover World Market % change WTI Crude Oil (USD/barrel) 44.39-3.67% T-Bill and AWPLR Gold (USD/Ounce) 1221.60-1.60% 13.0 12.0 S & P 500 2409.75-0.56% 12.5 12.0 11.5 11.0 MSCI AC Index 153.81-0.50% 11.5 10.5 11.0 10.0 10.5 9.5 10.0 9.0 9.5 8.5 9.0 8.0 7/7/2016 9/7/2016 11/7/2016 1/7/2017 3/7/2017 5/7/2017 7/7/2017 AWPLR (LHS) T Bill Rate- 12 months (RHS) Sector Multiples Sector PER(x) PBV(x) Banks, Finance and Insurance 7.50 1.20 Beverage, Food and Tobacco 17.20 3.80 Chemicals and Pharmaceuticals 10.70 0.90 Construction and Engineering 34.50 1.00 Diversified 14.20 1.10 Footwear and Textiles 24.00 0.60 Exchange Rate Healthcare 16.90 2.90 160.00 158.00 156.00 154.00 152.00 150.00 148.00 146.00 144.00 142.00 140.00 47.30 2.10-0.50 - - 9.20 0.90 8.10 1.50 7.70 0.80 54.40 1.40-0.60 9.30 1.40-1.30 15.00 0.70 Tea and Rubber Prices Telecommunication 15.70 1.30 730 680 630 580 530 480 430 380 330 280 230 180 7/7/2016 9/7/2016 11/7/2016 1/7/2017 3/7/2017 5/7/2017 7/7/2017 Latex Rubber Low Grown Tea Source: Rubber Development Department of Sri Lanka/Forbes & Walker Tea Brokers Hotels and Travels IT Investment Trust Land and Property Manufacturing Motors Oil Palm Plantations Power and Energy Services Stores and Supplies Trading 13.00 0.90 Quote of the Week: It s far better to buy a wonderful company at a fair price than a fair company at a wonderful price. - Warren Buffett Page 2
Weekly Crossings Dividend Announcements Security No Price(LKR) Quantity Security DPS(LKR) Type XD Date Monday JKH 3 179.00 880,021 AAF 0.07 Final 13/7/2017 HHL 1 154.00 242,873 AINS 0.40 Interim 17/7/2017 DIAL 1 11.90 3,005,610 Tuesday HNB 1 240.00 100,000 COMB 1 140.00 238,927 Wednesday COMB 1 140.00 313,838 DIAL 1 11.90 2,862,001 HHL 1 153.00 354,063 CCS 1 850.00 135,000 Thursday AEL 1 56.70 500,000 REXP 1 235.00 386,775 Friday BREW 1 600.00 239,300 LION 1 438.00 345,094 JKH 1 179.00 233,040 Corporate Disclosure Softlogic Holdings PLC (SHL) announced that Softlogic Retail (Private) Limited (a subsidiary of the company) has entered into a share and purchase agreement on 30th june 2017 in order to acquire all of the shares in issue of Suzuki Motors Limited, at a total consideration of Rupees Two Hundred and Fifty Million ( LKR 250, 000, 000). CSE CCorporate Announcements Kotagala Plantations PLC (KOTA) announced that in terms of section 8 of the listing rules, the parent company of KOTA, Lankem Plantation Holdings Ltd has changed its name to "Consolidated Tea Plantation Limited" with the effect from 29th June 2017. Page 3
Corporate News The Asian Development Bank has doubled its assistance to Sri Lanka, aiming to give up to a billion US dollars annually from 2017 with the government proposing railways, ports and roads as potential sectors to be developed. A finance ministry statement said that currently, the ADB provides around USD 400 to 500 million in annual assistance for road development, sanitation, fisheries, irrigation and skills and educational sector development projects. - economynext The Extra Ordinary General Meeting (EGM) held by Hatton National Bank PLC with regard to the issuance of shares by way of a Rights Issue was successfully concluded yesterday. As per the resolution passed by majority shareholders, the bank will issue one new share for every six shares held by ordinary voting and ordinary non-voting shareholders. The shares to be provisionally allotted to each shareholder would be based on the shares held as at the end of trading on the date of the EGM. - Daily Ft LB Finance accomplished a stellar performance overall for the year ended 31 March as total assets crossed the Rs. 100 billion milestone to reach Rs. 102.8 billion, a growth of 21.6% over the previous year.the company has been able to record compounded annual growth rates (CAGR) of 19.2%, 17.3% and 19.6% respectively in total assets, customer deposits and loans and advances over the past five years. Profit before tax on financial services grew by 17%, reaching Rs. 6.9 billion for the financial year 2016/17.-Daily Ft Economic News The rupee ended weaker on Tuesday as importer dollar demand outpaced greenback sales by exporters and banks, dealers said. Expectations of a rise in imports also weighed on the local currency, they added.the spot rupee ended at 153.63/70 per dollar, weaker from Monday s close of 153.57/63. The spot rupee resumed trading on June 19 for the first time since 5 May, when the Central Bank fixed its reference rate at 152.50. We have seen some demand from state banks to cover oil bills, and there is demand from the construction sector as well, said a currency dealer, requesting anonymity. -Daily Ft Moody s Investor Service yesterday gave Sri Lanka s new Inland Revenue Act a thumbs up, saying it paves the way for revenue reforms and IMF loan disbursement, which would be a credit positive. On 19 June, Sri Lanka s (B1 negative) Government made public a new income tax bill that will replace the existing law with a more efficient, modern and broad-based tax framework, it said in its latest report. The proposed revisions to the Inland Revenue Act, which were gazetted by the Department of Government Printing, will contribute to an increase in Sri Lanka s very low level of government revenues, a key constraint on the sovereign credit profile. -Daily Ft The Sri Lankan government is to sign a deal with the International development Agency of the World Bank for a loan of US$75 million to modernise its financial sector. The Cabinet of Ministers this week approved the decision to get the loan, equivalent to 55.4 million SDR (special drawing rights), Gayantha Karunathilleka, cabinet spokesman and Minister of Land and Parliamentary Reforms, said. The interest rate on the loan had increased to 3.36% from 3.20%, when the original talks had been held, he said. - economynext Global Buzz Asian stocks climbed as Japanese and Hong Kong markets staged a turnaround. Geopolitical concerns in the wake of North Korea s missile test remained, though demand for haven assets ebbed. Japanese and Hong Kong equities reversed early declines, led by gains in automakers and technology companies. The yen and gold pared gains even amid lingering concerns that North Korea is closer to building a device capable of hitting the U.S. Oil retreated after climbing for eight straight sessions. U.S. equity and bond markets are set to reopen after the July 4 holiday The U.S. confirmed the rocket launched on July 4 was an intercontinental ballistic missile, with Secretary of State Rex Tillerson calling it a new escalation of the threat to the U.S. and its allies that would be brought before the United Nations Security Council.- Bloomberg Page 4
Head Office Branches LOLC Securities Limited No.481, T.B.Jayah Mawatha Colombo 10, Sri Lanka Tel: +94 11 5 889 889 Fax: +94 11 2 662 883 Kurunegala Branch No 06, 1st Floor, Union Assurance Building, Rajapilla Mawatha Kurunegala, Sri Lanka Tel: +94 377 201221 Fax: +94 372 225511 Matara Branch Kandy Branch 1 st floor, 88, Dalada Weediya, E.H. Cooray Towers, Kandy. No 24, Anagarika Dharmapala Mw. Matara, Sri Lanka Tel: +94 414 936079 Contact Us Sriyan Gurusinghe Manjula Kumarasinghe Sales Head Office Maniesh Rodrigo Imesh Fernando Naleen Sadeesh Damith Chaminda Dushan Rajaguru Dinuka Niwantha Niraj Jayamanne John Ravindu Ushan De Silva CEO/Managing Director 011 5889888/ 077 7891871 COO - Sales & Marketing 011 5889808 / 077 7874310 Assistant General Manager- Sales 011 5889805/ 077 7896064 Assistant Manager Sales 011 5889814 / 077 3954992 011 5889839/ 077 2383209 011 5889819/ 077 3367313 011 5889834/ 077 9090511 011 5889838 / 077 7769461 011 5889813 / 077 5965645 Investment advisor 011 5889842/ 0717101805 011 5889842 / 077 1927998 sriyang@lolcsecurities.com manjulak@lolcsecurities.com manieshr@lolcsecurities.com imeshf@lolcsecurities.com naleensa@lolcsecurities.com damithc@lolcsecurities.com dushanr@lolcsecurities.com dinukan@lolcsecurities.com nirajj@lolcsecurities.com johnr@lolcsecurities.com ushand@lolcsecurities.com Kurunegala Branch Rohana Chandrasiri Assistant General Manager 037 7201221 / 077 3623001 rohanac@lolcsecurities.com Anurudda Rajakaruna 037 7201221 / 077 3409464 anuruddhar@lolcsecurities.com Bandula Senarathne Investm 037 7201221 / 076 8743157 bandulase@lolcsecurities.com Nuwan Fernando 037 7201221 / 077 8365921 nuwanfe@lolcsecurities.com Matara Branch Bimal Malinda Ahamed Aadil Thilina Sameera Branch Head 041 4936079 / 077 3409243 bimalm@lolcsecurities.com 041 4936079 / 077 7538986 aadila@lolcsecurities.com 041 4936079 / 077 8894968 thilinawa@lolcsecurities.com Kandy Branch Samadhi Jayasinghe Manager Institutional Sales 077 3954993 samadhij@lolcsecurities.com RESEARCH Shehan Bartholomeuz Head of Research 011 5889835 / 077 7699148 Gayan Rajakaruna Senior Research Analyst 011 5889837 / 077 4469070 Hiruni Perera Associate Research Analyst 011 5889809 / 077 4805784 shehanb@lolcsecurities.com gayanraj@lolcsecurities.com hirunipe@lolcsecurities.com General Disclaimer: LOLC Securities Limited is a company incorporated in Sri Lanka and licensed by the Securities and Exchange Commission of Sri Lanka to operate as a stockbroker/stock dealer in Sri Lanka. LOLC Securities Limited is a trading member of Colombo Stock Exchange. This research is based on information from sources that LOLC Securities Limited believes to be reliable. Whilst reasonable care has been taken to ensure accuracy of the information presented in the research, LOLC Securities Limited does not give a guarantee on the accuracy of the information presented in the paper nor will take the responsibility on investment decisions taken based on the information provided by the research and hence LOLC Securities Limited nor its employees accepts any liability whatsoever for any loss arising from investments decisions taken using the information provided in this paper. The reader also should note this paper does not give recommendations to any particular category of investors and investor should consult investment advisors for further clarifications regarding risks involved in investing in equity market. Investing in securities has inherent risks with no guaranteed return and price may be subjected to significant volatilities. No part of this report should be considered as a solicitation to buy or sell any security or product or to engage in or refrain from engaging in any transaction. LOLC Securities Limited or its employees may or may not hold positions in the securities discussed in the research and the information provided in the research should not be construed as a buy or sell instruction for any securities mentioned in the research, Unless otherwise specifically mentioned. This research is intended for general use for clients of LOLC Securities Limited and must not be copied in whole or in part or distributed to any third party for commercial use without permission from LOLC Securities Limited. If the reader is not the intended recipient please inform LOLC Securities Limited immediately by return email to research@lolcsecurities.com. LOLC Securities Limited s other staff including sales people, traders and other professionals may provide oral or written market commentaries or trading strategies to our clients which reflect opinions which are contrary to the opinions expressed in this research which may be influenced by different circumstances. OLC SEC Research Reports are also available at Bloomberg LOLC <GO> Page 5