Deals on Singer, DIMO and chase of CDIC dominate bourse

• Singer Industries sell stake in parent; High networth investors among buyers
• SLIC Life fund enters DIMO as Thurstan Investments part sells
• CDIC rises by 75% to fall in to SEC price band

Strategic as well as speculative deals on a few selected stocks kept the Colombo Bourse alive yesterday though overall it was a day of mixed fortunes.

The All Share Index gained marginally by over 8 points but Milanka dipped by nine points on a day when turnover was a healthy Rs. 3.12 billion. Foreigners were net sellers to the tune of Rs. 165 million.

Highlight of the deals were Singer Industries selling its stake in the parent Singer Sri Lanka. In total 2.57 million shares of Singer Sri Lanka traded for Rs. 331.4 million. This included a crossing of 0.53 million shares at Rs. 122 whilst the stock touched a high of Rs. 149 before closing at Rs. 131.20, up by Rs. 16.30.

Analysts said Dilith Jayaweera controlled Emagewise, Ajith Devasurendra’s Taporbane and Niroshan de Silva’s Orion were on the buying side of Singer. Initially speculation was Ceybank Unit Trust sold part of its stake.

The sale by Singer Industries was previously announced in its 2010 Annual Report. In 2010 recognized a gain of Rs. 135.8 million in its accounts from revaluing investment in Singer Sri Lanka. It was previously recognized as a long term investment but reclassified as a current investment in 2010 after Board decided to dispose it to enjoy capital gain. As at March 31, 2011, Singer Industries had a 1.44% stake amounting to 1.8 million shares in Singer.

In another interesting deal around 100,000 DIMO shares was bought by Sri Lanka Insurance Life Fund for Rs. 165 million. The seller was Thurstan Investments which as at March 31, 2011 had a stake of 0.514 million shares. DIMO closed at Rs. 1,638.90, up by Rs. 38.80.

Under speculative run was CDIC which owns stake in Aviva NDB Insurance holding company. Its share price zoomed to a high of Rs. 707.30 at close up by Rs. 303.10 or 75% with a mere 59,900 shares traded. The rise since Friday saw CDIC captured under the SEC’s price band.

“The indices remained volatile during the day while activity levels were centered around banking, finance and insurance sector counters,” John Keells Stock Brokers said.

NDB Stockbrokers said although both indices started on a positive note, MPI slipped as the day progressed to close lower in a market still dominated by retail speculation. Nation Lanka Finance was the top turnover contributor for the second consecutive trading day.

Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Nation Lanka and Janashakthi Insurance), while the sector index increased by 2.24%. Trading sector also contributed significantly to the market turnover helped by Singer Sri Lanka.

Nation Lanka Finance gained Rs 2.10 (7.66%) to close at Rs 29.20 while Janashakthi Insurance closed at Rs 20.20, having gained Rs 1.80 (9.42%).

Reuters said the stock market edged  up on Monday, led by a 75 percent gain in illiquid financial  firm Capital Development and Investment, on  speculation it could profit sharply from selling its stake in an  insurance firm.   

Capital Development closed at a record 707.30 rupees and it  has risen 214 percent in three straight sessions on speculation  it will sell its stake in an insurance firm owned by National  Development Bank, Capital Development’s majority owner.  National Development Bank gained 5.7 percent.   

Sri Lanka’s main share index closed 0.12 percent or  8.83 points firmer at 7,468.41, to its highest since May 20.  

The day’s turnover was 3.13 billion Sri Lanka rupees  ($28.5  million), more than last year’s average of 2.4 billion and this  year’s daily average of 2.83 billion.   

Foreign investors were net sellers for 165.3 million rupees’  worth of shares on Monday and they have sold a net 6.36 billion  rupees worth shares in 2011 after a record 26.4 billion in 2010.  

Traded volume was 141.8 million against a five-day average  of 104.8 million. The 30-day and 90-day average trading volumes  were 56.7 million and 67.8 million respectively, Reuters data  showed. Last year’s daily average was 67.9 million.  

The bourse is still Asia’s best performer in 2011 with a  12.5 percent gain, after bringing in the region’s top return of  96 percent last year.  

The rupee edged down to 109.77/80 a dollar from  Friday’s 109.87/90 as the central bank reduced both the lower  and upper ends of the trading band by 10 cents to 109.30/80,  dealers said.