CSE sets twin records

The Colombo Stock Exchange’s (CSE) net foreign inflow of Rs 11,254 million was more than double that of the previous year, its Chairman Nihal Fonseka revealed in the 2007 Annual report.

The CSE’s net turnover was unchanged and for the first time in many years there were no new listing of equity although on the other hand, listed entities raised an all time record amount of Rs 44.6 billion as new capital from rights issues during the year.

After several years of significant appreciation in the indices, the All Share Price Index registered a drop of 6.7% but on a rolling 5 year horizon still recorded an average compounded growth of 27% p.a. outstripping the return on fixed income securities during the same period by a comfortable margin.

The CSE operated profitably although its profit after tax of Rs. 142 million was 30% lower than in the previous year.

CEO, SCC, Swekha Sellahewa said that a notable achievement for the CSE in the year 2007 was the raising of Rs. 44.6 billion by 21 listed companies through Rights Issues, which is the highest amount recorded in the history of the CSE. The largest ever net foreign inflow of Rs. 11.2 billion was also recorded during the year.

High interest rates, high inflation and the current security situation, however, had a negative impact on the performance of the price indices during the year 2007.

After a continuous Bullish trend since 2001, the CSE recorded a negative growth in both Price Indices for the first time in 2007.

The All Share Price Index (ASPI), which opened the year at 2,722.4 points, continued on an upward trend for the first two months and reached an all-time high of 3,016.4 points on 13th February.

The downward movement of the ASPI, which commenced in March 2007, continued through the year, to close at 2,541, recording a decline of 6.7% for the year.

Despite the decline in the Price Indices, market activity 2007 was comparable with that of 2006.

The average daily turnover for 2007 was Rs. 435.6 million, 0.2% below the average daily turnover of Rs. 436 million recorded in 2006.

The average daily turnover at the end of February 2007 was Rs. 789.4 million, the highest recorded, and remained above Rs. 500 million during the first half of the year.

Market capitalization of the Colombo Bourse has seen a significant growth over the past few years.

The highest ever market capitalization of Rs. 938.6 billion was recorded on 13th February 2007.

The market capitalization as at the end of 2006 of Rs. 820.7 billion was 1.7% lower than the year’s opening.

A Net Foreign Flow of Rs. 11.2 billion was recorded for the year 2007, being the highest ever foreign inflow in history, surpassing its previous record of Rs. 6.2 billion, in 2005.

Foreign investors accounted for 44.6% of the total purchase for 2007, in comparison to 35.3% in 2006 and 24.2% in 2005, reflecting an increasing interest in the local market.

The Total purchase made by foreign investors during 2007 amounted to Rs. 46.8 billion, while the total sales made by foreign investors was Rs. 35.5 billion.