Financial Times

Good time for rights issues

With the Colombo stock market at record-breaking levels everyday, the current time is the best for rights issues from firms wanting to cut their debt as well as those planning to expand their ventures, according to analysts.

“When a stock market is doing well, it is the right time for firms to raise cash to settle their debts as well as for their expansion projects,” Naren Godamanna, Director- Sales, Acuity Stockbrokers told the Sunday Times FT.

During the last few days Lion Brewery (Ceylon), Renuka Holdings and Touchwood announced rights issues where the latter wants to raise cash for expansion while the other are looking to reduce their gearing.

Thakshila Hulangamuwa, Vice President Business Development Asha Phillips Securities said that many such firms will announce their rights issues in the coming months. Analysts said that the market is doing so well – that you can sell almost anything. “There is a certain herd mentality, but it is on an upward trend. Much of the good news is factored in the share prices of certain firms and the retailers are punting on them,” an analyst said.

The Hemas Power Initial Public Offering (IPO) for 31.3 million ordinary shares to raise Rs. 600 million or more was oversubscribed at Rs. 20 per share by late morning on Thursday, while NAMAL Acuity Fund IPO was also oversubscribed.

The Colombo share market created history on Thursday by recording its highest ever market capitalisation with Rs 942.6 billion while also churning a highest turnover of Rs 1.5 billion.

Top to the page  |  E-mail  |  views[1]
Other Financial Times Articles
> Bureaucratic bungling stalls IRD building reconstruction
> Trade union to address EU Parliament Human Rights Council on GSP+
> Gotabhaya: Sri Lanka heads for new economic goals
> Plantations getting back to normal
> Big corporate names in Jaffna as interest grows
> Aitken Spence gung-ho on hotel expansion
> COMMENT - GSP+: Unions enter the picture
> The saga of oil exploration in the Mannar Basin
> ICASL holds 30th National Conference
> Good time for rights issues
> Vasu considers legal action against ICASL Council, Ethics Committee
> People's Bank reduces interest rates
> LSE's buyout of MillenniumIT - a done deal
> Unregulated finance companies crisis forum at ST Business Club
> Sri Lankans' potential yet to be fully tapped
> GSK introduces treatment for breast cancer
> Ceylinco Finance PLC repositioned as ‘Nation Lanka Finance’
> MBAs and their perverse Bonus Schemes?
> Political risk insurance in Sri Lanka
> Day/night car care clinic from AMW
> Tea estate company losses rise due to amendment in accounts
> MTI CxO Survey on Business Technology: Findings out soon
> WSO2 Carbon wins InfoWorld award
> Lanka Princess Hotel wins TUI award
> Unemployment on increasing trend in Sri Lanka
> Lankan manufacturing base to export 4,000 computers monthly to Pakistan
> New IT-BPO workforce survey expected in December
> UAE's Etisalat bids for Sri Lanka’s Tigo
> Footwear and Leather Fair 2009 in November
> Michael Elias back as President of Sri Lanka Germany Business Council
> International University soon under public-private partnership
> Rights based approach for labour migration
> Kelani Cables PLC to centralise operations
> Czech Republic to welcome the Pope
> Sri Lankan $500 mln bond next month
> Details of forcibly acquiring property of F&G revealed in court
> CB wants independent verification on Ceylinco Shriram assets
> Global airline industry forecasts rising losses this year
> Harpo's Pizza completes one year in the Maldives
> Sri Lanka will not submit to an investigation by another country - Minister of International Trade
> Directors of F&G Property Developers (Pvt) Ltd released on bail
> Sinhala fonts not widely available
> CIMA Business Leaders Summit: The challenge – ‘Now and Ahead’
> Wage pressures could spur inflation -CB Asst. Governor
> TIENS says it’s not a pyramid scheme, operates within the law
> Biggest economies adjusting investment policies to attract investments
> New President at Sri Lanka – Italy Biz Council
> Seven -judge bench hears PBJ case
> AGM of the Sri Lanka – Australia – New Zealand Business Council
> SriLankan Catering posts Rs. 1.2 billion net profit


Reproduction of articles permitted when used without any alterations to contents and a link to the source page.
© Copyright 2009 | Wijeya Newspapers Ltd.Colombo. Sri Lanka. All Rights Reserved.| Site best viewed in IE ver 6.0 @ 1024 x 768 resolution