Share depreciation in two LOLC Group companies dampens bourse

By Hiran H.Senewiratne

CSE trading activities were negative throughout yesterday due to two index heavy companies belonging to LOLC Group, i.e., LOLC Finance and Commercial Leasing Finance share prices depreciating; pushing the All-Share Price Index into negative territory. However, the turnover level was quite healthy like on most other trading days, stock market analysts said.

The share depreciation witnessed in those companies followed the announcement by the CSE on the revision/changing of index calculation methodology with effect from January next year. The stock market index will change from a weighted market capitalization method to an index -based calculation method.

Due to these developments, stock market analysts and brokers said, investors who had invested in the said LOLC companies tended to sell their stocks in those two companies. However, other blue-chip companies traded well and drove the S and P SL20 index to positive territory.

LOLC Finance shares depreciated by 30 percent or Rs 11.40. Its shares started trading at Rs 37.20 and at the end of the day their price dropped to Rs 25.80 by contributing 134 negative points to the All -Share Price Index. Commercial Leasing and Finance shares depreciated by 19 percent. Its shares started trading at Rs 78.50 and at the end of the day they dropped to Rs 66.10, contributing 214 negative points to the All -Share Price Index.

Amid those developments mixed reactions were witnessed in both indices. All Share Price Index went down by 366.17 points and S and P SL20 went up by 38.37 points. Turnover stood at Rs 9.3 billion with two crossings. Those crossings were reported in Chevron Lubricants, where 2.6 million shares crossed for Rs 284 million and its shares traded at Rs 105.50 and Alumex two million shares crossed for Rs 28 million; its shares traded at Rs 14.

In the retail market top seven companies that mainly contributed to the turnover were LOLC Finance Rs 2.8 billion (91.2 million shares traded), Expolanka Holdings Rs 1.5 billion (6.6 million shares traded), Browns Investments Rs 554 million (50.4 million shares traded), Sierra Cables Rs 491 million (38.5 million shares traded), LOLC Holdings Rs 356 million (471,000 shares traded), Commercial Leasing and Finance Rs 266 million (3.9 million shares traded) and Royal Ceramic Rs 218 million (3.9 million shares traded).

CSE yesterday fell by two percent even with a healthy turnover level. During the day 322 million share volumes changed hands in 62000 transactions. Yesterday, the US dollar was quoted at Rs 201.78, which was the Central Bank controlled price to prevent price escalations in the prices of essential goods.