Business Times

Capricious behaviour at the bourse

Stockmarket Review
By Elton P. Ebert

The week opened with a substantial turnover of over Rs. 3 billion made possible through dealings of over 20 million Aitken Spence and two million in JKH which also brought in a foreign funds inflow of around Rs. 2.5 billion.

This was following last Friday's sensational Rs.15 billion turnover, and many expected at least a temporary bull run. But this was not to be as the market returned to its old losing ways for the rest of the week, except on Friday when a minor recovery took place promoting the All Share Index back to the 5400 mark. JKH which reached Rs.200 on Monday went into contraction with the rest of the market, but was in constant demand. Commercial Bank and HNB evoked fair interest while ERI and Free Lanka Capital were also fancied.

Nourishing interim dividends of Rs.7.50 and Rs.4.50 by Kegalle and Namunukula plantations injected enthusiasm into the two stocks which pushed the prices up while the other plantations, shares remained stagnant. Kegalle ended the week at Rs 103, while Namunukula ended at Rs.60.
Some analysts say that it is a paradox that export-based companies are still stuck in the grove because with US Dollar being quoted at these levels there should have been a big spurt in these stocks. Oil prices appear to be directed northwards which could mean plastic prices rising and as such some brokers have advised their clients to bear in mind that glass bottles will creep up in demand. Renuka Agrifoods announced a Rights issue of 2-for-5 at Rs 4 per share but the stock was on the slide ever since to close at Rs 6.

Access Engineering which issued 20 million shares at Rs.25, will commence trading on the Diri Savi Board on March 27. This stock which is in the Construction & Engineering Sector, should have many keen watchers of its price structure during the first few days of trading. Meanwhile the Rs.350-million Mackwoods IPO closed on Thursday being fully subscribed.

Many more companies are hoping to come out with their IPOs in due course. As part of its restructuring, Lankem Ceylon subsidiary Colombo Fort Hotels Ltd transfered its 19.73 stake or 118,351 shares in Beruwela Resorts Ltd. Dialog finally bought over the entire share capital of Suntel Ltd, with its share price hovering around the Rs 7 mark and ended at Rs.7.30 on Friday.

Changes in directorates: Nawaloka Hospitals - Dr. T. Senthilverl was appointed a Non Executive Director on February; People's Merchant - Dr. Chandrasena Samarasinghe was appointed CEO; Hemas Power - Husein Esufally tendered his resignation as Chairman effective April 1st and will be replaced by Imtiaz Esufally; Singer Finance (Lanka) - J.A. Setukavalar was appointed as an Independent Director. Turnover for the week was Rs.5.4 billion as against the unusual Rs.18.1 billion last week. The ASI at 5422.33 was 27 points or 0.25% lower while the Milanka was 16.39 or 0.1% better to finish at 4847.86.

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