CSE back in positive territory; recovers from last week’s dip

by Hiran H.Senewiratne

CSE trading bounced back yesterday and remained positive throughout the day subsequent to the dip in the market recorded last Friday due to price depreciations in the LOLC Group of companies.

More than Rs 41 billion off the floor transactions occurred when LOLC Holdings on Friday completed the transfer of the shares of three finance companies to LOLC Ceylon Holdings Ltd. (LOCH), which was not a listed company. The purpose of this move was to attract large foreign investors to the company, stock market analysts said.

The three companies were, LOLC Finance PLC (LOFC), Commercial Leasing and Finance PLC (CLC) and LOLC Development Finance PLC (NIFL). The off-the-floor transfer followed approval of the Securities and Exchange Commission (SEC), while the move was first announced in January this year.

A 44.79 per cent stake of LOLC Finance (LOFC), amounting to 2.35 million shares, was transferred. A stake of 98.92 per cent or 6.3 million shares of Commercial Leasing and Finance (CLC) as well as 55.55 per cent stake or 132.18 million shares of LOLC Development Finance (NIFL) were also transferred.

This transaction exceeds 10 per cent of the equity of LOLC as per the latest Audited Financial Statements. The Related Party Transactions Review Committee of LOLC is of the view that the transaction is on normal commercial terms and is not prejudicial to the interests of the entity and its minority shareholders.

Amid those developments both indices moved upwards. The All -Share Price Index went up by 158.52 points and S and P SL20 rose by 33.07 points. Turnover stood at Rs 6.1 billion with two crossings. Those crossings were reported in Softlogic Holdings, where 2.5 million shares crossed to the tune of Rs 34.6 million and its shares traded at Rs 13.50 and CIC 500,000 shares crossed for Rs 25 million, its shares traded at Rs 50.

In the retail market top seven companies that mainly contributed to the turnover were, LOLC Finance Rs 2.3 billion (90.7 million shares traded), Expolanka Holdings Rs 648 million (2.7 million shares traded), LOLC Holdings Rs 342 million (447,000 shares traded), Browns Investments Rs 245 million (22 million shares traded), ACL Cables Rs 233 million (three million shares traded), Sierra Cables Rs 191 million (14.5 million shares traded), Sunshine Holdings Rs 165 million (4.7 million shares traded). During the day 223 million share volumes changed hands in 40000 transactions. hSenid Business Solutions will go for an IPO soon and is set to offer 55,339,076 new ordinary voting shares at Rs. 12.50 per share, and plans to raise a total sum of Rs. 692 million to fund the company’s key growth initiatives, including strategic acquisitions, geographical expansions, and product enhancements.

Yesterday, the US dollar quoted in the local market was Rs 202.20, which was the controlled price of the Central Bank. This controlled price has been introduced to prevent the dollar rate from skyrocketing, which is now selling at more than Rs 240.