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by Ravi Ladduwahetty

Trading at the Colombo bourse was on a strong note yesterday with the turnover shooting to Rs. 1.3 billion and where blue chip Central Finance share gaining Rs. 36 amidst speculation of an imminent bonus issue, market analysts told the Daily News.

There was a parcel of 89, 400 Central Finance shares which changed hands among retail investors where the day's star performer Central Finance gained a staggering Rs 37 (up 13% from yesterday's close) to close at Rs. 265.50. The Central Finance share shot up sharply from 243 to Rs. 280 and closed at Rs. 265.50.

Market sources attribute the sharp rise in the Central Finance share to the strong possibility of the company shortly announcing a bonus share issue, with the company's Annual General Meeting on Friday seen as a potentially pivotal date. Central Finance has a good track record of giving bonuses, with its last bonus being a 1 for 1 issue in for the year 2001.

Analysts also point out that the dynamics of the leasing industry were extremely positive in view of declining interest rates, and argue that market leader Central Finance offers good value even at current prices as it is trading at a steep discount to the market. However, when contacted by the Daily News, Central Finance Managing Director/ CEO Eranjith Wijenaike refused to comment on the possible bonus issue.

Of the other leading stocks, foreign buying was mainly in National Development Bank (NDB) with the share attracting Rs. 117 million worth of foreign buying interest. There was a total of 700,000 shares which was bought by a Corporate Fund overseas while the sellers were Employees Trust Fund Board (500,000 shares) and the National Savings Bank (200,000 shares

Analysts argue that NDB remains under-valued at current levels, and anticipate further upside in the short term, especially once its merger plans with NDB Bank are finalised.

Some profit taking was evident in market heavyweight Sri Lanka Telecom (SLT) with 12 million shares being traded at between Rs. 22.50 and Rs. 24.50. South Asia Fund are believed to have sold over 8.6 mn shares, contributing the lion's share of the day's foreign selling. A mix of high net worth individuals and domestic institutions were the buyers.

John Keells Holdings (JKH) purchased a further 13.6 mn shares of Asian Hotels in the market at Rs. 29 per share following Friday's 60.5 percent acquisition at Rs. 4.1 billion. Among the sellers are understood to have been National Asset Management Ltd (NAMAL) which sold a parcel of 1.8 million shares and National Savings Bank which sold 8.5 million shares. The others are believed to be high net worth individuals.

After an uncertain start to the day, the All Share Index closed up a provisional 3.6 points to close at 1255.6 while the Milanka Index closed up 18.6 points to close at 2370.3.

The day's turnover was a strong Rs. 1.3 billion, with foreigners however being net sellers to the tune of Rs 91 million.

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