Stockmarket Review Returning to the days of high turnovers
A week brimming with action!! That's what it was this week ending February with a small dose of margin calls, unlike the usual month-end destruction that takes place at the bourse. The turnover for the week was very impressive due to hyper-activity in Aitken Spence, Hayleys and L.B. Finance, as well as a few strategic deals like 1.8 million shares in Ascot Holdings and the 59.7% stake equivalent to 3.6 million shares in Sathosa Motors which transferred control to Access Engineering. It is now mandatory for the company to make an offer for the remaining shares at Rs. 235 per share. Would-be subscribers to the Access IPO are now asking some brokers as to why the company is effecting these new developments after it launched its IPO, and whether it is a confidence building exercise. Many have got burnt with some of the IPOS like Softlogic Holdings, Free Lanka Capital Holdings, People’s Leasing and Textured Jersey, and hence the various queries posed by investors.
Sampath Bank which rewarded its shareholders with a massive dividend and a scrip dividend had more good news with its success in its syndicate loan of Rs.7.5 billion. This is its second offshore fund, the first being the US$45 million which it received in 2007. Its price was up to Rs 186.30 earlier this week but eased to Rs.181 on Friday. Another significant and of greater economic benefit is the agreement which Laugfs Holdings signed with the Sri Lanka Institute of Nanotechnology to produce titanium oxide from mineral sands. Laugfs is aggressively venturing out into all branches of the economy eg - the leisure sector. From the leisure sector Beruwala Walk Inn had its share price rise steeply to Rs.157.80 with news that the hotel received Rs.210 million as a compensation claim. It however lost ground to end at Rs.150. In a different tone Watawala Plantations passed its resolution for the sale of its subsidiary Watawala Marketing amidst controversy at its recent EGM. Foreign inter- est was visible in Ceylon Tobacco, Sampath Bank, Aitken Spence Royal Ceramics JKH and Chevron, all stocks with heavy growth potential.
Analysts believe that the all share index should hold ground around the 5400 mark. It started the week in discomfort but managed to finish at 5460. There should be some interesting movements as the quarter draws to a close, with a variety of portfolio adjustments and window dressing.
Changes in directorates: DFCC Bank - J.E.A. Perumal was appointed independent Director on February 27; Lanka Hospital Corporation PLC -Dr. N. Bandula Chandranath Wijesiriwardena, nominee of Sri Lanka Insurance Corporation PLC, was appointed to the Board on 27th February; C.W. Mackie - Mangala Perera was appointed Executive Director effective 2nd April; Walkers PLC - P. Amaratunga, Niranjan DevaAditya, and H. R. Srilal Wijeratne were appointed to the Board on 29th February; Bukit Darah PLC - Ralph De Lanerolle was appointed Non Executive Independent Director on 28th February 2012.
Turnover for the week was satisfying at Rs. 11.1 billion against Rs.6.8 billion the week before. Both indices were lower, the ASI losing 106.11 points or 2% to close at 5460.19, while the Milanka lost 57.49 points or 1% to end at 4745.19.