Plans to sell controlling stake in Dankotuwa Porcelain boost market; Lanka IOC shares up as well

By Hiran H.Senewiratne

CSE trading was slightly volatile yesterday but in mid- session the market received a boost when plans were announced for the sale of the controlling stake in Dankotuwa Porcelain, market analysts said.It is said that a share purchase agreement was announced between Ambeon Holdings and Ceyline Investments. Ambeon Holdings plans to sell a 50.1 percent stake in Dankotuwa Porcelain to Ceyline Investments, running into Rs 2.3 billion.

The overall market is moving up on domestic debt optimization assurances, picking up several stock counters in the market, analysts said. According to Ambeon, the transaction is subject to completion on conditions precedents identified in the said share sales and purchase agreement.

The Lanka IOC share price also moved up with the announcement that Sri Lanka is in talks with India to build an oil pipeline to transport fuel to the Eastern Port of Trincomalee.

‘There are on-going discussions on bringing an oil pipeline from India to Trincomalee, President Ranil Wickremesinghe told energy investors, according to a statement from his media office.

Trincomalee has a World War II-era 99 tank farm. A part of the tank farm is under the control of Lanka Indian Oil Corporation. The rest is under the joint control of IOC and the Ceylon Petroleum Corporation.

Further, the banking and diversified financial sectors are picking up on domestic debt optimization assurances, while investors are seeking alternative investments, bringing up the market on green, an analyst said. The consumer durables and apparel sector drew in 2.3 billion rupees in revenue in mid- day trade.

Amid those developments both indices moved upwards marginally. The All- Share Price Index was up by 1.5 points and S and P SL20 rose by 8.2 points. Turnover stood at Rs 5 billion with eight crossings. Those crossings were reported in Dankotuwa Porcelain, where 81.4 million shares crossed to the tune of Rs 2.3 billion and its shares traded at Rs 28.30, Distilleries 1.5 million shares crossed for Rs 33.7 million; its shares traded at Rs 32.50, HNB’s 200,000 shares crossed to the tune of Rs 32.8 million; its shares traded at Rs 164.

Sunshine Holdings 602,000 shares crossed to the tune of Rs 30.1 million; its shares traded at Rs 50, Hayleys 300,000 shares crossed for Rs 27 million; its shares traded at Rs 90, JKH 145,000 shares crossed for Rs 23 million and its shares fetched Rs 159m, Bahira Farms 125,000 shares crossed to the tune of Rs 21.2 million and its shares traded at Rs 170 and Expolanka Holdings 150,000 shares crossed for Rs 21.15 million; its shares traded at Rs 141.

In the retail market top seven companies in the market that contributed to the turnover were Lanka IOC, Rs 409.7 million (2.9 million shares traded), Sunshine Holdings Rs 371 million (7.4 million shares traded), Hemas Holdings Rs 109.7 million (1.4 million shares traded), Sampath Bank Rs 98.2 million (1.5 million shares traded), JKH Rs 74.6 million (469,000 shares traded), Commercial Bank Rs 70.1 million (874,000 shares traded) and Aitken Spence Rs 69.6 million (512,000 shares traded). During the day 172 million share volumes changed hands in 13000 transactions.

Lankem Group’s Agarapatana Plantations Ltd. is to list on the Colombo Stock Exchange via an Initial Public Offering worth Rs. 747.6 million.The CSE has approved, in-principle, an application by the company to list on the Diri Savi Board.

The IPO involves 83,070,111 Ordinary Voting Shares at Rs. 9 each. The quantity of shares amount to 16.61% of the post-issue Ordinary Voting Shares of the company.Net Asset Value per share of the Equity (NAV) is Rs. 8.43 and the Offer Price is 1.07 times the NAV. Capital Alliance Partners Ltd. is the manager of the IPO.

Funds raised via the IPO are for investment in modern equipment to develop APL factories to “State of the Art – Processing Centres” (Rs. 672.6 million) and settlement of high-cost term loans worth Rs. 75 million.Yesterday the Central Bank’s US dollar buying rate was Rs 308.16 and selling rate Rs 321.87.