ASHA PHILLIP SECURITIES LTD

DAILY STOCK MARKET HIGHLIGHTS Level 4, MillenniumJ House, 46/58, Navam Mw, Colombo 02 Tel 94 11 2429100 Fax 94 11 2429199 www.ashaphillip.net th [email protected] 19 December 2011

PRICE INDICES INDEX 19-Dec 16-Dec CHANGE % CHANGE ASPI 5,860.96 5,892.69 -31.73 -0.54% MPI 5,105.41 5,134.68 -29.27 -0.57%

Market Statistics 19-Dec 16-Dec Value of Turnover(Rs.) 537,646,282 462,950,587 Domestic Purchases 352,087,272 311,145,277 Domestic Sales 411,639,483 289,520,456 Foreign Purchases 185,559,010 151,805,310 Foreign Sales 126,006,799 173,430,130

Volume of Turnover (No.) 18,712,782 17,068,276 PER 15.27 15.35 PBV 1.93 1.94

PRICE INDEX TURNOVER SECTOR SECTOR SECTOR TODAY PREVIOUS VALUE (Rs) VOLUME TRADES P/E PBV BANK FINANCE AND INSURANCE 13,297.01 13,355.85 86,130,976.00 2,557,023 1,295 12.70 2.00

BEVERAGE FOOD AND TOBACCO 11,864.88 11,714.43 17,980,292.00 699,797 520 15.20 4.10 CHEMICALS & PHARMACEUTICALS 9,240.63 9,320.33 5,030,645.00 191,615 96 8.40 1.10 CONSTRUCTION AND ENGINEERING 3,183.35 3,184.20 884,170.00 22,558 32 9.50 2.10 DIVERSIFIED HOLDINGS 1,843.42 1,854.66 261,994,464.00 2,996,865 676 16.80 1.70 FOOTWEAR AND TEXTILE 1,102.33 1,109.39 7,373,780.00 93,940 78 29.90 1.30 HEALTH CARE 566.45 552.85 10,186,640.00 580,600 200 17.90 2.00 HOTELS AND TRAVELS 3,714.23 3,791.46 6,283,134.50 258,089 209 26.30 1.80

INFORMATION TECHNOLOGY 210.07 208.11 5,579,680.00 508,400 174 20.10 2.50 INVESTMENT TRUSTS 30,186.10 30,707.85 28,796,498.00 670,117 581 16.00 2.00 LAND AND PROPERTY 608.50 603.64 22,631,324.00 706,655 442 20.70 1.20 MANUFACTURING 3,169.33 3,156.78 32,427,314.00 957,921 595 15.20 2.20 MOTORS 27,605.15 27,689.78 575,780.00 3,419 12 17.80 4.00

OIL PALMS 128,220.78 134,773.14 1,938,600.00 1,900 18 34.60 2.50 PLANTATIONS 800.85 810.93 401,030.20 20,653 68 4.80 1.00 POWER & ENERGY 129.68 129.65 12,452,730.00 2,337,900 194 12.60 1.60 SERVICES 25,397.99 25,217.17 421,990.00 54,800 22 8.60 2.80 STORES SUPPLIES 37,846.51 37,551.64 1,243,640.00 1,414 15 11.60 0.90

TELECOMMUNICATIONS 162.97 162.77 231,000.00 24,000 31 26.30 1.90 TRADING 23,344.19 23,726.91 4,803,138.00 1,067,691 155 11.80 1.30

Market Highlights

TOP GAINERS

VWA PREV VWA DAYS CHANGE CHANGE HIGH LOW No. of TURNOVER COMPANY CLOSE CLOSE (Rs.) % (Rs.) (Rs.) SHARES (Rs)

SERENDIB HOTELS [X] 15.50 18.50 3.00 19.35 18.50 18.50 300 5,550.00 EQUITY 41.20 48.30 7.10 17.23 48.30 48.30 100 4,830.00 CAL FINANCE 34.60 39.00 4.40 12.72 39.00 39.00 200 7,800.00 GESTETNER 262.50 295.00 32.50 12.38 295.00 295.00 200 59,000.00 TALAWAKELLE 25.10 27.50 2.40 9.56 27.50 25.20 900 24,020.00

TOP LOSERS

VWA PREV VWA DAYS CHANGE CHANGE HIGH LOW No. of TURNOVER COMPANY CLOSE CLOSE (Rs.) % (Rs.) (Rs.) SHARES (Rs.) INDUSTRIAL ASPH. 615.00 503.40 (111.60) (18.15) 555.00 435.00 400 194,510.00 AVIVA N D B 278.50 240.00 (38.50) (13.82) 240.00 240.00 100 24,000.00 UNION CHEMICALS 798.00 710.00 (88.00) (11.03) 710.00 710.00 4,000 2,840,000.00 SAMSON INTERNAT. 117.00 105.70 (11.30) (9.66) 110.10 100.10 700 73,860.00 TRANS ASIA 73.00 66.60 (6.40) (8.77) 67.60 65.10 1,000 66,630.00

MARKET CAPITALISATION COMPANY NAME Price ISSUED QTY MKT CAPITALISATION As a % (Total) PLC 170.10 841,368,253 143,116,739,835 6.54 CARSONS CUMBERBATCH PLC 543.20 196,386,914 106,677,371,685 4.88 THE BUKIT DARAH PLC 1,006.20 102,000,000 102,632,400,000 4.69 CEYLON TOBACCO COMPANY PLC 472.90 187,323,751 88,585,401,848 4.05 SRI LANKA TELECOM PLC 45.10 1,804,860,000 81,399,186,000 3.72 COMMERCIAL BANK OF CEYLON PLC 100.00 765,085,320 76,508,532,000 3.50 DIALOG AXIATA PLC 7.90 8,143,778,405 64,335,849,400 2.94 NESTLE LANKA PLC 889.00 53,725,463 47,761,936,607 2.18 DISTILLERIES COMPANY OF SRI LANKA PLC 149.50 300,000,000 44,850,000,000 2.05

AITKEN SPENCE PLC 110.00 405,996,045 44,659,564,950 2.04

HIGHEST VOLUME HIGHEST TURNOVER COMPANY NAME TRADED SHARE TURNOVER COMPANY NAME TURNOVER (Rs) VOLUME VOLUME (Rs) JOHN KEELLS HOLDINGS 188,902,450.00 SMB LEASING PLC [X] 88 2,295,200 1,605,340.00 PLC 57,753,030.00 PANASIAN POWER PLC 108 2,163,200 8,780,680.00 COMMERCIAL BANK 30,427,520.00

BLUE DIAMONDS JEWELLERY [X] 162 1,605,500 5,781,090.00 ENVIRONMENTAL RESOURCES 25,465,110.00 JOHN KEELLS HOLDINGS 199 1,124,800 188,902,450.00 SWARNAMAHAL FINANCIAL 15,066,610.00 TESS AGRO PLC 115 1,032,200 3,877,150.00 COLOMBO LAND & DEV:COM 14,481,570.00 AMANA TAKAFUL PLC 57 894,300 1,958,680.00 PLC 12,789,240.00 ENVIRONMENTAL RESOURCES 497 643,600 25,465,110.00 HVA FOODS PLC 11,982,280.00 AITKEN SPENCE PLC 73 524,900 57,753,030.00 CHEVRON LUBRICANTS 10,046,520.00 BROWNS INVESTMENTS 48 442,900 1,739,400.00 PANASIAN POWER PLC 8,780,680.00

CITRUS LEISURE PLC [W0019] 27 370,200 5,602,000.00

Market Announcement

Dividend Announcement - CARG d of Cargills (Ceylon) PLC has announced Rs. 0.70 per Share as Interim Dividend. The XD date is 29th December 2011 where the

th payment will be made by 06 January 2012.

company

Market Comment

Market Comments Market Comments

Market Comment s The market opened the day with a negative sentiment, and continued to be volatile during the trading day pervading in red

territory. The All Share Price Index (ASPI)28-Apr dipped-2011 31.73 Interim points financial to close statements the day at 5,- 860.96HPFL . The more liquid Milanka Price Index (MPI) lost 29.27 points to close at 5,105.41. The market capitalization was LKR 2.14Tn.

H The market activities were dull up until early afternoon recording low turnover levels; a privately negotiated transaction on HPFL - Financial Statements for the period ended 31-03-2011 have been uploaded on the CSE website. JKH.N towards the end of the trading day increased the closing turnover level above LKR500 Mn. 207 counters traded during

the day to record a turnover of LKR 537.6 Mn which is an increase of 16% compared to the previous trading day. John Keells Holdings PLC (LKR 189Mn), Aitken Spence PLC (LKR 57.5Mn) and Commercial Bank (LKR 30.4Mn) were the top contributors to 28-Apr-2011 2011 Warrants Conversion - GREG the daily turnover. Two Crossings were taken place with JKH.N for the total value of 125.1 Mn.

A total of 18.7Mn shares changed hands during the trading day, which was an increase of 9.6% in traded volumes, compared to

the previous day. SMB Leasing PLC [X] (2.3Mn), Panasian Power PLC (2.2Mn) and Blue Diamonds Jewellery [X] (1.6Mn) were the Ket actively traded counters for the day. Price gainers28-Apr outnumbered-2011 Price theBands price losers by 85:79. The price gainers were led by Serendib Hotels [X] (Price gain of 19.35 %) on the contrary, Industrial Asph. (Price loss of 18.15%) led the price losers. The

foreign transactions recorded a net inflow of LKR 59.5Mn. In terms of the SEC directive dated 14th September 2010, the 10% price band has not been imposed on a new security considering the review period from 21st April 2011 to 28th April 2011 (Both days inclusive).

The full list of securities on which the 10% price band is applicable is attached.

Local Market News

Sri Lanka Approves US$1.8bn in Tourism Projects Deputy Economic Development Minister said that Sri Lanka's tourism development office has approved 1.8 billion dollars of

investment proposals to build hotels. A 'one stop unit' at the tourism development office which was set up in November 2010 had received 189 applications by October 2011 of which 73 had been approved, 04 have been rejected and 112 are being

processed, minister further said. The 184 projects with investment values of 1.85 billion dollars involve building 11,809 rooms. Sri Lanka's capital Colombo has attracted the largest investment of 903.8 million US dollars involving 3,941 rooms, followed by

Hambantota in the south with 189.1 million US dollars (720 rooms). (LBO)

Sri Lanka to Promote Tea Brand in Key Markets

Sri Lanka will register its 'Ceylon tea' brand and seven growing regions in 25 key markets next year, using intellectual property

law to protect its main agricultural export. Sri Lanka Tea Board chairman said the move is part of an international marketing campaign to be launched in 2012 to promote Ceylon tea using a special promotion levy on exports that has collected a billion

rupees since November 2010. (LBO)

Sri Lanka Tea Meets to Seek Common Standard Tea producing and consuming countries will seek to agree on a common standard for pesticide residue levels in tea during a

meeting of the United Nations Food and Agriculture organization body in Colombo early next year. Common tea production

standards and the effects of climate change on cultivation will also be discussed at the FAO inter-governmental group (IGG) on tea from January 30 to February 01, 2012. (LBO)

Sri Lanka Policy Rates Kept Steady, Market Rates Up

Sri Lanka's active polity rate at which cash is injected to the market would be maintained at 8.50 percent, as defence of a dollar peg pushed market rates up. Sri Lanka overnight rates have moved from the lower policy rate band of 7.0 percent at which excess liquidity in withdrawn from the interbank market towards the 8.50 percent ceiling as the Central Bank became a net

seller of foreign exchange. (LBO)

International Market News

Fitch revises outlook on France to 'negative'

Ratings agency Fitch has affirmed France's top-notch AAA credit rating but has revised its outlook on the country to "negative"

from "stable". Fitch said the change in outlook was prompted by the heightened risk of government liabilities arising from the eurozone's debt crisis. The agency also said it was considering downgrading ratings for Belgium, Spain, Slovenia, Italy, Ireland

and Cyprus. "Following the EU Summit on 9-10 December, Fitch has concluded that a 'comprehensive solution' to the eurozone

crisis is technically and politically beyond reach," the agency said in a statement. (BBC) India Keeps Interest Rates on Hold at 8.5%

The Reserve Bank of India has held interest rates at 8.5%, interrupting a long period of rate increases. The widely expected

decision reflects concern at the weakness of the economy. Inflation remains high, although the rate of wholesale price rises fell to 9.1% in November from 9.7% a month earlier. Despite the central bank raising rates 13 times since March, the value of the Indian rupee fell to another all-time low against the dollar this week. (BBC)

Economic Indicators & Other Statistics

Exchange Rates Indicative Rates

19-Dec-11 16-Dec-11 19-Dec-11 16-Dec-11 Currency Currency Buying Selling Buying Selling Ind: Value Ind: Value Dollar (USA) 112.97 114.88 112.97 114.88 Yuan(China) 17.95 17.94 Pound (UK) 174.35 178.72 174.83 179.21 Rupee(India) 2.17 2.13 Euro (EU) 146.08 150.37 146.34 150.63 Won(Korean) 0.10 0.10 Dollar (Canada) 107.83 111.27 108.67 112.14 Dinar(Kuwait) 408.95 409.12 Dollar (Australia) 111.14 115.02 111.66 115.56 Ringgit(Malay) 35.85 35.85

Dollar (Singapore) 85.96 88.58 86.09 88.72 Rial(Oman) 295.84 295.84 Yen (Japan) 1.44 1.49 1.44 1.49 Riyal(Qatar) 31.28 31.28 Riyal(KSA) 30.37 30.37 Dirham (UAE) 31.01 31.01

Central Bank's Policy Rates % Per Annum Central Bank Repurchase (Repo) Rate 7.00 Central Bank Reverse Repurchase (Reverse Repo) Rate 8.50 Bank Rate 15.00

Statutory Reserve Ratio (SRR) 8.00

Treasury Bills AWPLR AWDR This week Last week This Week Last week This Month Last Month 91 Days 8.43 8.28 Weekly 10.55 10.22 Monthly 6.72 6.57 182 Days - 8.56 Monthly 9.84 9.33 6 Months 6.47 6.40 364 Days - 9.06 6 Months 9.43 9.32 Fixed Deposits 8.21 8.12

Colombo Consumers’ Price Index (CCPI) Year 2011 Year 2010 Description September October November September October November Year on Year Change % 6.40 5.10 4.70 5.70 6.50 6.90

Annual Average Change % 7.20 7.10 6.90 5.30 5.70 6.10

SLIBOR & LIBOR Over Night 7 Days 1 M 3 M 6 M 12 M SLIBOR (19-Dec) 8.8800 9.1700 9.4300 9.8000 10.0100 10.2500

LIBOR - GBP(16-Dec) 0.5800 0.6287 0.7643 1.0648 1.3553 1.8465 LIBOR - USD(16-Dec) 0.1505 0.2005 0.2848 0.5631 0.7880 1.1104

Medium Term Macroeconomic Framework (a) Projections

Indicator Unit 2009 2010 2011 2012 2013 2014 GDP at Market Prices Rs. bn 4,835.00 5,602.00 6,440.00 7,405.00 8,513.00 9,790.00 Real GDP Growth % 3.50 8.00 8.50 9.00 9.50 9.50 Per Capita GDP US$ 2,057.00 2,399.00 2,794.00 3,200.00 3,660.00 4,190.00 Total Investment % of GDP 24.40 27.80 29.50 32.00 33.00 34.00 National Savings % of GDP 23.70 24.70 25.80 29.10 30.70 32.30 Trade Gap US$ mn (3,122.00) (5,205.00) (6,762.00) (7,399.00) (7,993.00) (8,531.00)

Debt Service Ratio % 18.90 14.60 13.50 16.20 12.60 14.30 Government Debt % of GDP 86.20 81.90 80.00 75.00 71.00 67.00

(CBSL.lk, Global-rates.com, CBSL Annual Report 2010)

Foreign Stock Exchanges

Foreign Stock Exchanges Country Foreign Markets- Index 17-Dec-11 % Change 15-Dec-11 % Change 14-Dec-11 USA Dow Jones Indus. AVG 11,866.40 -0.02% 11,868.80 0.38% 11,823.50 USA NASDAQ Composite Index 2,555.33 0.56% 2,541.01 0.07% 2,539.31 Europe Euro Stoxx 50 Pr 2,202.72 -1.00% 2,224.89 0.86% 2,205.91

UK FTSE 100 5,387.34 -0.25% 5,400.85 0.63% 5,366.80 Japan Nikkei 225 8,401.72 0.29% 8,377.37 -1.66% 8,519.13 Hong Kong Hang Seng Index 18,285.39 1.43% 18,026.84 -1.78% 18,354.43

China CSI 300 Index 2,390.13 2.11% 2,340.79 -2.36% 2,397.48 Pakistan Karachi 100 Index 11,028.14 -1.00% 11,139.50 -1.43% 11,300.99 India BSE Sensex 30 Index 15,491.35 0.00% N/A 0.00% 15,881.14

Singapore FTSE Straits Times Index 2,659.22 0.91% 2,635.25 -1.39% 2,672.39 Malaysia FTSE Bursa Malaysia EMAS 10,054.49 0.16% 10,038.11 0.12% 10,025.95

Bangladesh DSE General Index DGEN N/A 0.00% 5,000.18 0.63% 4,968.78 Mongolia MSE Top 20 Index 18,515.00 -1.46% 18,788.50 -0.53% 18,888.60

Commodity Prices & Other Statistics

Rubber Prices-Auction 13th Dec: World Commodity Prices Grade Price Range (Rs) Commodity 19-Dec 16-Dec 15-Dec LC No.1X 370.00-370.00 Brent Crude Oil 105.09 105.09 105.02 LC No.1 370.00-370.00 WTI Crude Oil 92.91 94.18 95.73 LC No.2 360.00-360.00 Gold 1,587.17 1,587.32 1,573.49

LC No.3 350.00-353.25 Silver 29.01 29.42 28.34 LC No.4 342.00-349.00 Copper 3.27 3.31 3.25 SC (Br) No.1 335.00-351.00

SC (Br) No.2 330.00-343.00 Tourist Arrivals to Sri Lanka 2009 2010 2011 SC (Br) No.3 j unquoted January 38,468 50,757 74,197 SC (Br) No.4 318.00-330.00 February 34,169 57,300 65,797 Skim Crepe unquoted March 34,065 52,352 75,130 RS Sheet No.1 390.00-400.00 April 26,054 38,300 63,835 RS Sheet No.2 380.00-387.00 May 24,739 35,213 48,943 June 30,234 44,730 53,636

Tea Prices- Auction- 29th & 30th of November July 42,223 63,339 83,786 Elevation Price/Kg Pre:Price/Kg August 41,207 55,898 72,463 Uva High 301.44 304.86 September 37,983 47,339 60,219 Western High 335.55 342.68 October 37,575 52,370 69,563 Uva Medium 308.99 307.97 November 44,311 72,251 90,889

Western Medium 303.62 312.55 December 56,862 84,627 - Low Grown 371.29 355.80 Total 447,890 654,476 758,458

(Oil Price.net, srilankastockpicks.blogspot.com, pureceylontea, LBO, rrisl) Asha Phillip Securities Limited – Research

Thakshila Hulangamuwa Pasindu Perera Vice President – Business Development Manager - Research thakshi@ashap hillip.net [email protected] 0094 113070494 0094 112429109

Lasantha Senanayake Ranuka De Silva Kumuthini Sivathas Research Analyst Research Analyst Tr. Research Analyst [email protected] [email protected] [email protected]

Asha Phillip Securities Limited – Branch Network

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This document has been prepared and issued by Asha Phillip Securities Ltd, on the basis of publicly available information, internally developed data and other sources, believed to be reliable. Whilst all responsible care has been taken to ensure that the facts stated are accurate and the opinions given are fair and reasonable neither Asha Phillip Securities Ltd, nor any Director, Officer or employee, shall in any way be responsible for the contents. Asha Phillip Securities Ltd may act as a Broker in the investments which are the subject of this document or related investments and may have acted upon or used the information contained in this document, or the research or analysis on which it is based, before its publication. Asha Phillip Securities Ltd., Its Directors, Officers or Employees may also have a position or be otherwise interested in the investments referred to in this document. This is not an offer to sell or buy the investments referred to in this document.