Lanka shares hit new peak on hotel shares

15 January 2010 12:34 pm - 0     - {{hitsCtrl.values.hits}}

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COLOMBO, Jan 15 (Reuters) - Sri Lankan shares .CSE rose 0.94 percent to a new record high on Friday as investors stepped up buying of hotel shares on hopes of better profits due to peaking post-war tourist arrivals to the island nation.


The All-Share Price Index .CSE of the Colombo Stock Exchange climbed to 3,576.84 points in the first two hours of trading, surpassing its previous peak of 3,549.27 hit on Monday. The bourse closed 0.75 percent or 26.43 points firmer at an all-time high close of 3563.14.

The hotel and travels sector index .CSEHT hit a record high and closed with a 4.57 percent gain on retail buying.

"Investors expect a greater tourism season this year," said Harsha Fernando, CEO at SC Securities. "Since room rates have also been increased, high revenues are expected."
 

Tourist arrivals to Sri Lanka, which fell 19.8 percent in the first five months of 2009 due to a long-running civil war, gained 2.1 percent to 447,890 in for the full year. The New York Times last week listed Sri Lanka among 31 must-visit destinations this year due to 'a more peaceful era' after the end of the conflict.
 

The state tourism authority has forecast 600,000 arrivals this year with a 25 percent rise in revenue to $500 million

John Keells Hotels JKH.CM jumped 8.47 percent to an over one-year high of 32 rupees, while Asian Hotel Properties AHPL.CM gained 3.34 percent to 108.25 rupees.
 

Market heavyweight John Keells Holdings JKH.CM closed flat at 179 rupees.

In a statement to the bourse, Janus Capital Management, an investment advisor registered under the U.S. Investment Advisers Act, said it is holding a 12.23 percent stake of the John Keells Holdings on behalf of its clients.

Analysts said foreign investors, who have sold a net 869 million rupees worth of shares so far in 2010, may return once the presidential election is over.
 

Sri Lanka is set for presidential elections on Jan. 26 with incumbent Mahinda Rajapaksa facing a challenge from his former army chief Sarath Fonseka, who oversaw the defeat of the separatist Tamil Tiger rebels.


The day's turnover was 1.56 billion rupees ($13.7 million), around thrice of 2009 daily average of 593.6 million rupees. Daily average turnover for this year has been 1.9 billion rupees.

The bourse has risen over 5.2 percent so far this year after being one of the world's best performing markets in 2009, jumping 125.2 percent on post-war optimism. (Reuters)

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