Tuesday, May 14, 2013

Today 6,206.59 3,500.50 Point Change - 32.44 - 18.35 % Change -0.52 % q -0.52 % q

ASPI S&P SL 20 Index YTD Performance ASPI S&P SL 20 Index

Level 23, East Tower, World Trade Centre, Colombo 01 Tel: +94 11 727 7000, Fax: +94 11 727 7099 Email: research@equity.softlogic.lk

10.0% 13.5% 636.2 860.9 24.0 40.1 2,378.9 154.3 183.9 29.6 9.7

Today's Turnover (LKR mn) Annual Average Daily Turnover (LKR mn) Volume (mn) Annual Average Daily Volume (mn) Market Capitalization (LKR bn) Net Foreign Inflow / (Outflow) [LKR mn] - Foreign Buying (LKR mn) - Foreign Selling (LKR mn) YTD Net Foreign Inflow / (Outflow) [LKR bn]

Bourse on profit taking

CSE Diary for 14.05.2013

Bourse edge lower: The benchmark index stayed stagnant for the first half of the day, but was unable to sustain the level with selling pressure bringing down the index by 32 points. With strong buying interest in the previous week the index gained over 200 points resulting in the current profit taking. 72 counters gained for the day compared to 143 that dipped. Ceylinco Insurance, Cargills, Richard Peiris & Company and Commercial Bank were heavy weights leading the decline of the index. John Keells Holdings leads the turnover list: John Keells Holdings was identified as the top performer for the day amidst healthy buying interest taking counter passed the previous 52-week high to LKR274.0 while settling at LKR273.0 at end of day. One large on-board block was noted in the counter of 157k shares dealt at LKR273.0. With the announcement of earnings and dividends, investor

interest surrounded Piramal Glass, the coloured glass bottle manufacturer, touched a 52-week high of LKR6.9 today and closed at LKR6.8 with a gain of 3.0%. Some selling pressure on banking sector counters: Banking sector continued to remain heavily active with National Development Bank, Nations Trust Bank, Sampath Bank, Union Bank and Commercial Bank leading the turnover. Profit taking following last weeks run led most counters to end on a negative note. Retailers remain silent: With the index adopting a down trend today, activity of the retail investor segment saw a drastic decline with most investors of the segment remaining on the sidelines adopting a wait and see approach.

Statistical Look Up
Treasury Bill (%) 3 months 6 months 12 months AWPLR Excess Liquidity (LKR 'bn) Inflation (%) Apr-13 as at 14.05.2013 YoY Change Annual Avg Week ending 10.05.2013 9.18 11.29 13.48 -6.28 6.4 8.8 10.20

6400 6200

Index

6000 5800 5600 5400

ASPI
3550 3500 3450 3400 3350 3300 3250 3200

Turnover LKR ('mn)

5,000 4,000 3,000

150.0

Volume ('mn)

Index

100.0 50.0 0.0

2,000 1,000
0

S&P SL20

Turnover

Volume

Today All Share Price Index S&P SL20 Index Turnover (LKR mn) Turnover (USD mn) Volume (mn shares) Traded Entities Market Capitalization (LKR bn) Foreign Purchases (LKR mn) Foreign Sales (LKR mn) Net Foreign Inflow (LKR mn) Market PER (X) Market PBV (X) Market Dividend Yield SECTOR INDICES Banks, Finance & Insurance Beverage, Food & Tobacco Construction & Engineering Diversified Healthcare Hotels & Travels Land & Property Manufacturing Plantation Telecom 6,206.6 3,500.5 636.2 5.0 24.0 247 2,378.9 183.9 29.6 154.3 16.8 2.3 2.2 Today 13,967.4 17,330.1 2,907.8 2,069.8 715.8 3,566.6 597.1 3,002.0 820.3 172.5

Pre Day 6,239.0 3,518.9 535.0 4.2 24.6 246 2,391.3 176.9 23.9 153.0 16.9 2.3 2.1 Pre Day 14,095.7 17,444.7 2,981.9 2,074.8 717.6 3,578.4 602.7 3,010.8 825.2 174.0

Change % -0.52% q -0.52% q 18.90% 18.90% -2.78% 0.41% -0.52% 3.96% 23.65% 0.87% -0.52% -0.52% 4.76% % Change -0.91% -0.66% -2.48% -0.24% -0.24% -0.33% -0.93% -0.29% -0.59% -0.87% q q q q q q q q q q

Last Week 6,201.7 3,512.0 1,386.6 11.0 54.4 255 2,377.0 322.5 73.7 248.8 16.8 2.3 2.2 Last Week 14,017.8 17,404.2 2,866.5 2,051.4 706.1 3,586.2 601.0 2,987.0 809.0 174.7

% WoW Change 0.08% -0.33% -54.12% -54.12% -56.00% -3.14% 0.08% -42.96% -59.81% -37.97% 0.08% 0.08% 0.00% % WoW Change -0.36% -0.43% 1.44% 0.90% 1.37% -0.55% -0.65% 0.50% 1.39% -1.27% Page | 2.

Softlogic Equity Research

High Index Calibre USD350 Mn

Company
JOHN KEELLS HOLDINGS CEYLON TOBACCO CARSON CUMBERBATCH NESTLE LANKA SRI LANKA TELECOM COMMERCIAL BANK [V] BUKIT DARAH DIALOG AXIATA HNB [V] AITKEN SPENCE DISTILLERIES LOLC CARGILLS DFCC BANK SAMPATH BANK ASIAN HOTELS & PROPERTIES

% of Mkt Cap 9.8% 6.5% 3.6% 4.2% 3.2% 3.9% 3.1% 3.3% 2.2% 2.3% 2.3% 1.2% 1.5% 1.6% 1.6% 1.4%

Volume 371,374 402 2,555 2,908 1,552 91,519 167 49,705 5,993 5,902 21,059 78,195 108 222 112,889 3,337

Turnover LKR ('000) 101,191.56 332.82 1,138.08 5,389.81 66.10 10,695.71 118.50 473.92 995.66 796.82 3,895.91 4,692.13 17.22 32.75 25,826.87 243.08

Turnover USD ('000) 801.55 2.64 9.01 42.69 0.52 84.72 0.94 3.75 7.89 6.31 30.86 37.17 0.14 0.26 204.58 1.93

Intraday Intraday High (LKR) Low (LKR) 274.00 833.00 448.50 1,860.00 42.90 117.90 713.00 9.60 170.00 135.60 185.10 61.00 159.50 148.50 229.90 73.90 270.50 820.00 440.00 1,840.00 42.20 116.50 705.40 9.40 165.00 135.00 182.00 59.50 159.10 147.10 227.00 72.50

Close 273.00 828.10 440.00 1,854.20 42.60 116.60 712.00 9.50 165.10 135.00 182.00 60.00 159.50 147.10 227.00 72.90

Price Gainers
Company
COLONIAL MTR DIMO SIGIRIYA VILLAGE E B CREASY CARGO BOAT

Price Losers
Today 107.40 605.40 77.90 1,136.40 107.40 Change + 17.40 + 85.40 + 7.80 + 111.20 + 10.40 % Change Company 19.33% 16.42% 11.13% 10.85% 10.72%
SERENDIB ENG.GRP HARISCHANDRA S M B LEASING CEYLINCO INS. MERC. SHIPPING

Today 141.00 2,050.70 0.90 990.00 149.60

Change - 40.00 - 249.20 - 0.10 - 100.00 - 11.40

% Change -22.10% -10.84% -10.00% -9.17% -7.08%

Top 05 Performers for the Day

Company
JKH NAT. DEV. BANK NATIONS TRUST PIRAMAL GLASS SAMPATH

Today 273.00 179.00 65.10 6.80 227.00

Pre Day 269.90 178.90 65.00 6.60 227.90

% Change 1.15% 0.06% 0.15% 3.03% -0.39%

Volume (mn) 0.37 0.49 0.57 3.87 0.11

Contribution to Total T/O 4.3% 3.7% 1.6% 1.1% 1.1%

Turnover (LKR) 101,191,564 87,383,342 37,009,222 26,340,411 25,826,868

Most Active
Company
PIRAMAL GLASS UNION BANK EXPOLANKA SOFTLOGIC TOUCHWOOD

Today 6.80 20.30 7.30 12.00 6.10

Pre Day 6.60 20.70 7.40 12.50 6.30

% Change 3.03% -1.93% -1.35% -4.00% -3.17%

Volume (mn) 3.87 0.91 0.83 0.79 0.73

Contribution to Total T/O 1.1% 0.8% 0.3% 0.4% 0.2%

Turnover (LKR) 26,340,411 19,099,468 6,065,644 9,560,046 4,496,510

Softlogic Equity Research

Page | 3.

Currency Board
Local - Indicative Rate against LKR
Currency Australia China EU India Japan Malaysia Russia Saudi Arabia Singapore Switzerland Thailand UK USA Dollar Yuan Euro Rupee Yen Ringgit Rouble Riyal Dollar Franc Baht Pound Dollar Indicative Rate 14.05.2013 126.01 20.55 164.32 2.31 1.24 42.28 4.03 33.66 101.91 132.46 4.26 193.39 126.25

Announcements
Dividends
Company Balangoda Plantations PLC 0 0 0 0 0 0 0
Company Description

DPS (LKR) 1.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Proportion 0

XD Date 27-06-2013 0 0 00-Jan-00 00-Jan-00 00-Jan-00 00-Jan-00 00-Jan-00

XR Date

Payment Date 04-07-2013 1/0/1900 1/0/1900 00-Jan-00 00-Jan-00 00-Jan-00 00-Jan-00 00-Jan-00
Renunciation

Rights Issues / Scrip Dividend / Sub division / Capitalization

No Announcements 0 0 0 0 0 1/0/1900 1/0/1900 1/0/1900 1/0/1900 1/0/1900 1/0/1900

Source: www.cbsl.gov.lk

Global Markets
Index AMERICA Dow Jones Industrial Average S&P 500 Index EUROPE EURO STOXX 50 Price EUR FTSE 100 Index ASIA Nikkei 225 Hong Kong Hang Seng Index
* Time is as at ET

Value 15,091.7 1,633.8 2,764.3 6,624.3 14,758.4 22,930.3

Change -26.8 0.1 -13.1 -7.5 -23.8 -59.5

Change % -0.18% q 0.00% p -0.47% q -0.11% q -0.16% q -0.26% q

Time* 0-Jan 0-Jan 06:59 07:00 02:28 04:01

Source: www.bloomberg.com

Commodity Markets
Commodity ENERGY Crude Oil (Brent) Crude Oil (WTI) AGRICULTURE ICE Cotton #2 CBOT Wheat METALS COMEX Gold COMEX Silver COMEX Copper
* Time is as at ET

Units USD/bbl. USD/bbl. USd/lb. USd/bu. USD/t oz. USD/t oz. USd/lb.

Price 102.13 94.70 85.87 711.75 1,427.40 23.38 328.70

Change -0.69 -0.47 -0.17 2.00 -6.90 -0.32 -7.25

Change % -0.67% q -0.49% q -0.20% q 0.28% p -0.48% q -1.33% q -2.16% q

Time* 06:43 06:43 06:43 07:03 06:43 06:43 06:43

Source: www.bloomberg.com

Softlogic Equity Research

Page | 4.

CSE Announcements
Kotagala Plantations [KOTA: LKR55.0]: Mr Rajaratnam has relinquished his position as Chairman with effect from 13th May 2013 and Mr. S.D.R Arupragasam who serves as a Director on the board has been appointed Chairman of the company. Mr C.P.R Perera has been appointed as Deputy Chairman of the Company.

Local News
Sri Lanka gets USD218 mn FDI in first quarter 2013: Sri Lanka has received USD218 mn of foreign direct investments in the first quarter of 2013 and is targeting two billion dollars for the full year, investment promotion minister Lakshman Abeywardena said. The money has come from 37 projects greater than a million US dollars and 144 projects smaller than a million US dollars. The investors came from, Taiwan, Canada, Virgin Islands, Netherlands, Singapore, UK, Australia and India. Minister Abeywardena said Sri Lanka's Board of Investment had received a number of applications greater than USD300 mn which were worth USD5.0 bn. Abeywardena said special attention was being give to speed up approvals. Once approved, it took about two to five years for the FDI to flow into the country, he said. [Source: www.lbo.lk] Sri Lanka market interest rates drop after rate cut: Sri Lanka's market interest rates has eased down with the effective policy rate settling at around 7.8% though cash auctions down from around 8.3% before a 50 basis point rate cut last week, dealers said. On Tuesday gilt backed overnight repurchase transactions were quoted 8.30/40 percent levels in the interbank market down from 8.60/70 levels last week. Call money which is uncollateralized, was down to about 8.60/90 levels from 8.90/9.00 percent levels. On Friday markets were short and some banks borrowed from the 9.0% standing facility keeping rates elevated, after the Central Bank lowered its policy corridor by reducing the standing facilities by 50 basis points to 7.0% and 9.0%. Rates started to adjust from Monday as markets liquidity increased and the Central Bank withdrew money though a repo open market auction at 7.83%, effectively setting a new policy signal rate within the standing facility corridor. [Source: www.lbo.lk] Sri Lanka hydro reservoirs get highest inflows in single day: An Indian Ocean cyclone named after an ancient Sri Lankan king who is famed for building irrigation tanks had brought the highest water inflows in a single day to the island's hydro power storage system. State-run Ceylon Electricity Board said 106 mn cubic meters of water which can generate 144 mn units of electricity (GigaWatt hours) had flowed in to the reservoirs in the 24 hours ending Tuesday morning. The water is worth about LKR3.2 bn in electricity based on the CEB's estimated cost of production of LKR23.0 for 2013. Hydro storage had risen to 794.4 GWh or 63.1 percent of total capacity from 52.6% or 661.5 GWh. Sri Lanka started building hydro power station from the middle of the last century and now has about 1,200GWh or capacity in various reservoirs some of which are also used for irrigation and flood prevention. The CEB said if not for the dams that kept the water from flowing down the 106 cubic meters of flow in a single day could have wreaked havoc downstream. [Source: www.lbo.lk] Sri Lanka's Dialog gains 2.3GHz spectrum from acquisition: Dialog Axiata [DIAL: LKR9.5] said it is buying a pay TV operator for LKR800 mn rupees to gain control of 2.3GigaHertz brand spectrum which will be used for fixed broadband services. Dialog, a unit of Malaysia's Axiata, said its fixed access division, Dialog Broadband Networks (Pvt) Ltd has entered into a deal to buy Sky Television and Radio Network (Pvt) Ltd, a company licensed to operate pay TV services. The company will be merged after the purchase, allowing Dialog Broadband to use the spectrum for its fourth generation (4G-LTE) services. Dialog said Sri Lanka's telecom regulator had given the nod for the merger and re-deployment of spectrum for broadband services. Dialog launched fixed broadband services using a 15MegaHertz frequency block in December 2012. The additional spectrum will allow the company to boost capacity, burst speeds and bandwidth delivered to its customers. [Source: www.lbo.lk] Softlogic Equity Research Page | 5
5

 Massive USD100 mn retail mall from Abans: For the first time, Sri Lankans would see an international standard retail mall with an investment of over US $ 100 million by SilverNeedle Hospitality Singapore and the ABANS Electricals [ABAN: LKR106.1] at an excellent two acre land close to the Beira Lake at Sir James Peiris Mawatha, Colombo 02. The development which had been named the Colombo City Centre, would comprise three parts, the residential component, a shopping centre and a 200 roomed upper scale five star hotel, NEXT Hotel TM, primarily targeting the business market. The construction would commence early 2014 and was scheduled to be completed in three years. SilverNeedle Hospitality and ABANS Group have appointed internationally-renowned and award-winning architect, Aedas to lead the design for their mixeduse lifestyle development, Colombo City Centre, which includes Asia's first NEXT Hotel TM. Among Aedas global projects were the North Star Mixed Used Development, Beijing, PRC and the Express Rail Link West Kowloon Terminus, Hong Kong PRC. Iqbal Jumabhoy, Managing Director and Group CEO, SilverNeedle Hospitality, told Daily News Business, Our companys view is that Sri Lanka is truly beginning to emerge. It has been stable for a while, as the government seems to have very solid plans for the development of Sri Lanka, particularly as a business destination. He said that although Sri Lanka was well known as a leisure destination, they believe that as a business destination, Lanka really was going to get better. As there were no significant international quality malls at the moment in Sri Lanka, this development would create a huge draw, not only for locals, but also for people in the region. He said that the residential component was important because there was a demand not only from the increasing number of Sri Lankans living overseas, but also from locals who wish to live in the City Centre. [Source: www.dailynews.lk]

Global News
German Investor Confidence Rose Less Than Forecast in May: German investor confidence rose less than economists forecast in May, highlighting the risks to the economic outlook as the euro region remains mired in recession. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, increased to 36.4 from 36.3 in April. Economists forecast a gain to 40, according to the median of 38 estimates in a Bloomberg News survey. While an unusually long winter delayed Germanys recovery from a slump in the final quarter of 2012, recent data indicate Europes largest economy is returning to growth. Factory orders and industrial production both increased more than economists forecast in March and the benchmark DAX share index climbed to a record high this month. Its pretty clear that Germany has found its way back to growth, said Guillaume Menuet, a senior economist at Citigroup Inc. in London. The problem is that it seems to be the only big European economy growing, and thats why the crisis in the euro area is far from over. [Source: www.bloomberg.com] UK. House-Price Gauge Climbs to Almost Three-Year High: U.K. house-price gauge rose to the highest in almost three years last month as government measures to support the housing market spurred demand, the Royal Institution of Chartered Surveyors said. The index rose to 1 from minus 2 in March, the first reading above zero since June 2010, London-based RICS said in an e-mailed report today, citing a monthly poll of property surveyors. A positive number means more respondents saw values increase rather than decline. A measure of inquiries from new buyers rose to 25 from 13, the highest since November 2009. The survey follows a report from mortgage lender Halifax last week that showed U.K. house prices rose to the highest in almost three years in April. Chancellor of the Exchequer George Osborne pledged 3.5 bnn pounds (USD5.4 bn) of loans plus 130 bn pounds of guarantees in March to help the housing market, adding to a creditboosting program introduced with the Bank of England last summer. It is encouraging to see government initiatives are having an impact, said Peter Bolton King, RICS Global Residential Director. Help to Buy in combination with the Funding for Lending Scheme appears to be giving the market a shot in the arm. Thankfully, sales are expected to pick up over the coming months. [Source: www.bloomberg.com]

Softlogic Equity Research

Page | 6
6