Stock market up in thin volume, turnover

Turnover, volume fall below last year’s average

Foreign investors continue to exit

Rupee edges up on cenbank lowering trading band

(Reuters) - Sri Lanka’s stock market rose on Friday but turnover and trading volume were light as most investors were out of the market during a holiday-shortened week.

The island’s main share index gained 0.85 percent or 64.70 points to 7,672.49. It hit a record closing high of 7,811.82 on Monday. Markets were closed for national holidays on Wednesday and Thursday.

Foreign investors sold a net 75 million rupees of shares on Friday, extending the total net foreign outflow to 6.2 billion rupees in 2011, after selling a record net 26.4 billion in 2010.

The bourse has still been Asia’s best performer with a 15.6 percent gain in 2011 after cinching the region’s top spot with a 96 percent return last year.

Turnover was 2 billion rupees ($17.9 million), less than last year’s average of 2.4 billion rupees and this year’s daily average of 4 billion rupees.

Traded share volume was 46.5 million, against a five-day average of 85.3 million. The 30-day and 90-day average trading volumes were 160.8 million and 69.4 million respectively. Last year’s daily average volume was 68.9 million.

The bourse is trading at a forward price-to-earnings (P/E) ratio of 16.5, one of the highest among emerging markets, compared with 12.3 in Asian markets and 11.9 in global emerging markets, Thomson Reuters StarMine data showed.

The rupee edged up to 110.92/110.93 a dollar from Tuesday’s 110.99/111.01 as the Central Bank reduced its dollar trading band by 5 cents to 110.35/110.95, dealers said.

Ceylon Tea Services, Malwatte join the band

Sharp rise in their prices yesterday saw Ceylon Tea Services Plc (CTS) and Malwatte Valley Plantations’ non voting share being brought under the SEC’s price band with effect from Monday.

Dilmah owning brand CTS saw its share price zoom to a high of Rs. 970 before closing at Rs. 968.30 up by Rs. 318.30 or 49% with just 5,800 shares traded.

The investor craving for the stock was following highnetworth individual investor Dr. T. Senthilverl paying Rs. 943 million to acquire 7.3% stake at Rs. 650 per share in CTS from a foreign fund on Tuesday.

Malwatte voting and non-voting also rose on the news of sub division. Malwatte non voting rose by 23% or Rs. 15.50 to close at Rs. 81.30 after peaking to Rs. 89 whilst voting share closed up Rs. 13.10 or 14% to Rs. 106 whilst its highest was Rs. 107.80.

The Company announced a sub division of both voting and non voting shares in the proportion of 10 per every one held.

HNB announces one into two sub division

HATTON National Bank (HNB) yesterday announced a 1 to 2 Sub Division of shares of both its voting and non voting shares (Subject to Approval).

Consequently, the number of voting shares would increase from 191.3mn to 287.0mn, whilst the number of non voting shares would increase from 46.7mn to 70.1mn. (If ESOP options are exercised by employees, voting shares would increase by an additional 95.7mn and the non voting by an additional 23.4mn shares).

HNB also announced a final dividend of Rs. 5.50 per share.