LGL...willl they report a huge Capital loss?

As per info LGL has purchased 1mn shares of GRAN in last quarter & if I have not mistaken they payed a sum of Rs 250 mn to this acquisition @ 250/- per share....!

Now afetr another 9 days fall, mark the end 2nd Quarter and have to submit the 2Q report... then when considering the payed price for GRAN & present price of Rs 110/- there is a massive 140mn loss of Capital...! for sure LGL can not hide this in their Q report so what would be the out come of this Q...? will the mkt price of LGL drop to 30s again as we witnessed last month...?

http://www.cse.lk/cmt/upload_report_file/671_1305023400346.pdf
(See the top 20 share holders of GRAN as at 31st March 2011)

a sad one..i have LGL.N 5000

RIO wrote:As per info LGL has purchased 1mn shares of GRAN in last quarter & if I have not mistaken they payed a sum of Rs 250 mn to this acquisition @ 250/- per share....!

Now afetr another 9 days fall, mark the end 2nd Quarter and have to submit the 2Q report... then when considering the payed price for GRAN & present price of Rs 110/- there is a massive 140mn loss of Capital...! for sure LGL can not hide this in their Q report so what would be the out come of this Q...? will the mkt price of LGL drop to 30s again as we witnessed last month...?

http://www.cse.lk/cmt/upload_report_file/671_1305023400346.pdf
(See the top 20 share holders of GRAN as at 31st March 2011)

I think on March 3rd they have purchased 1.0 M shares of GRAN for a price of Rs. 205/= per share and not for Rs. 250/= if i am not mistaken. But still as you mentioned they have a capital loss of around Rs. 100 M. Pretty big it seems.

Apart from this on the same day they have purchased about 1.5 M shares of REEF around Rs. 90 per share. There also they have another capital loss.

Anyway if these investments are long term investments then day to day price fluctuations does not make much of a difference I think.

nkalansu wrote:
Apart from this on the same day they have purchased about 1.5 M shares of REEF around Rs. 90 per share. There also they have another capital loss.

Thanks for the info on REEF purchase...Will have to evaluate that too , anyway do you have any links to confirm the REEF purchase (such as CSE announcement or REEF top 20 list or some thing documentation) Thanks again

RIO wrote:

nkalansu wrote:
Apart from this on the same day they have purchased about 1.5 M shares of REEF around Rs. 90 per share. There also they have another capital loss.

Thanks for the info on REEF purchase...Will have to evaluate that too , anyway do you have any links to confirm the REEF purchase (such as CSE announcement or REEF top 20 list or some thing documentation) Thanks again

Check Daily FT published on 4th March 2011. There you have the headline "Laugfs lights up Bourse". In that all the information is there.

RIO wrote:

nkalansu wrote:
Apart from this on the same day they have purchased about 1.5 M shares of REEF around Rs. 90 per share. There also they have another capital loss.

Thanks for the info on REEF purchase...Will have to evaluate that too , anyway do you have any links to confirm the REEF purchase (such as CSE announcement or REEF top 20 list or some thing documentation) Thanks again

As per the REEF quarterly Financial statements as at 31.03.2011, LGL is the 5th largest shareholder of REEF. They have 1.5 M shares which is 3.18% holding. You could download the quarterly statements from the CSE website.

If I'm not mistaken its not LGL who bought the shares but the Laugfs main company the holding company of LGL!!

PS:- I don't think I saw any official news regarding this and nothing if can remember in GRAN quarterly reports

Rajitha wrote: If I'm not mistaken its not LGL who bought the shares but the Laugfs main company the holding company of LGL!!

PS:- I don't think I saw any official news regarding this and nothing if can remember in GRAN quarterly reports

Rajitha, ...pls check my link (on 1st post) on GRAN 31st March Q report LGL is there on Top 2o list. & Clearly not LGL HOLDINGS.

they will account this transaction as a long term investment.

Sorry my bad! I had the memory that it was Laugfs holding for some reason and not LGL.

No surprise LGL boss had complained in Sunday Leader recently about 'mafia manipulating bourse' - sour grapes from him ?

http://www.thesundayleader.lk/2011/06/05/%E2%80%9Cmafia%E2%80%9D-manipulating-bourse/

LGL appears to have invested at wrong prices in GRAN, REEF and PHAR (12,000 shares - maybe when Nimal Perera was selling at around Rs 3,500 ?)

When LGL went public, they didn't say they were raising money to play the stock market.

Unless the holdings are strategic, LGL will not be able to account as long term, and will have to mark to market, as investing in shares is not core business of LGL.

Thanks RIO for pointing this out. The buying price was around 200 not 250 and I am not sure whether it is LGL or Laughf Holdings.

Anyway say it was LGL, then LGL didn't comment in the IPO that they are going to public for raising money for buying stocks. They had plans on leusire and bla..bla.. now what is hapenning... they can't take this cash out and go for promised plans..

Companies give lot plans when they go to public and issue rights but implement very few

ODEL had a plan to build a shopping complex, PCH had plans on BPO and Data Center but after one year see where these people going..

[quote="cse.alpha"]No surprise LGL boss had complained in Sunday Leader recently about 'mafia manipulating bourse' - sour grapes from him ?

http://www.thesundayleader.lk/2011/06/05/%E2%80%9Cmafia%E2%80%9D-manipulating-bourse/

LGL appears to have invested at wrong prices in GRAN, REEF and PHAR (12,000 shares - maybe when Nimal Perera was selling at around Rs 3,500 ?)

When LGL went public, they didn't say they were raising money to play the stock market.

Unless the holdings are strategic, LGL will not be able to account as long term, and will have to mark to market, as investing in shares is not core business of LGL.




investing in shares is not core business of LGL. but accounting standards allow to account any investment as long term investment at its cost price. company directors can pass board resolution to accept this type of transaction without making big loss at once.This time Mr.Wagapitiya also made a mistake. we have to wait untill they release quarter FS.

TortoizePlus wrote:Thanks RIO for pointing this out. The buying price was around 200 not 250 and I am not sure whether it is LGL or Laughf Holdings.

Anyway say it was LGL, then LGL didn't comment in the IPO that they are going to public for raising money for buying stocks. They had plans on leusire and bla..bla.. now what is hapenning... they can't take this cash out and go for promised plans..

Companies give lot plans when they go to public and issue rights but implement very few

ODEL had a plan to build a shopping complex, PCH had plans on BPO and Data Center but after one year see where these people going..

I think investing in share market all the companies do to gain the extra cash and feel no need to mention in the IPOs. LGL entered in the wrong time. But like ODEL promises shopping complex, PCH on BPO ans Data Center, FLCH hotels i think as share holders can raise the question in the AGM .

nkalansu wrote:

RIO wrote:As per info LGL has purchased 1mn shares of GRAN in last quarter & if I have not mistaken they payed a sum of Rs 250 mn to this acquisition @ 250/- per share....!

Now afetr another 9 days fall, mark the end 2nd Quarter and have to submit the 2Q report... then when considering the payed price for GRAN & present price of Rs 110/- there is a massive 140mn loss of Capital...! for sure LGL can not hide this in their Q report so what would be the out come of this Q...? will the mkt price of LGL drop to 30s again as we witnessed last month...?

http://www.cse.lk/cmt/upload_report_file/671_1305023400346.pdf
(See the top 20 share holders of GRAN as at 31st March 2011)

I think on March 3rd they have purchased 1.0 M shares of GRAN for a price of Rs. 205/= per share and not for Rs. 250/= if i am not mistaken. But still as you mentioned they have a capital loss of around Rs. 100 M. Pretty big it seems.

Apart from this on the same day they have purchased about 1.5 M shares of REEF around Rs. 90 per share. There also they have another capital loss.

Anyway if these investments are long term investments then day to day price fluctuations does not make much of a difference I think.

Hello nkalansu ,

Your memory is excellence , here's the article http://www.ft.lk/2011/03/04/laugfs-lights-up-bourse/

As per that article do you notice other interesting investments ????

Nimal Perera has bought 2.3 M shares of LGL around Rs. 55

Perpetual Capital / Arjun Aloysius bought 2.4 M shares of LGL at the same price.

So considering current price of LGL each of these people are having a loss around Rs. 35 M by investing in LGL shares. However these are long term investors. So they see long term value of LGL.

So I think it is good for us to collect some LGL shares at current price levels since all the high net worth investors have paid for LGL shares more than us................


Disclosure : I hold LGL non voting shares.

nkalansu wrote:As per that article do you notice other interesting investments ????

Nimal Perera has bought 2.3 M shares of LGL around Rs. 55

Perpetual Capital / Arjun Aloysius bought 2.4 M shares of LGL at the same price.

So considering current price of LGL each of these people are having a loss around Rs. 35 M by investing in LGL shares. However these are long term investors. So they see long term value of LGL.

So I think it is good for us to collect some LGL shares at current price levels since all the high net worth investors have paid for LGL shares more than us................


Disclosure : I hold LGL non voting shares.

but we do not know whether arjun allosius or nimal perera stil hold those shares.
these guys are not always long term investors. usually they drop thier holdings when opportunity comes.
I think LGL guys may have caught the trap of these guys.

LGL can interpret their transaction under investments. no need to quote a capital loss as you presume.

As per the article, it's Laugfs Holdings that has purchased above shares and therefore it's not needed to account for any losses in LGL accounts. Am I wrong?

But, as per GRAN quarterly statements it is LGL. As we have to rely on GRAN statements LGL has to disclose the fact somehow.

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.

Hiru wrote:As per the article, it's Laugfs Holdings that has purchased above shares and therefore it's not needed to account for any losses in LGL accounts. Am I wrong?

But, as per GRAN quarterly statements it is LGL. As we have to rely on GRAN statements LGL has to disclose the fact somehow.

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.

This was discussed sometime back even, its not LGL.. its Laughs Holdings.. The correct one was stated on a news article and GRAN has mistakenly put as LGL..

smallville wrote:

Hiru wrote:As per the article, it's Laugfs Holdings that has purchased above shares and therefore it's not needed to account for any losses in LGL accounts. Am I wrong?

But, as per GRAN quarterly statements it is LGL. As we have to rely on GRAN statements LGL has to disclose the fact somehow.

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.

This was discussed sometime back even, its not LGL.. its Laughs Holdings.. The correct one was stated on a news article and GRAN has mistakenly put as LGL..

@ Small Its LGL .. im sure ... its not holdings buddy

Chabbi wrote:

smallville wrote:

Hiru wrote:As per the article, it's Laugfs Holdings that has purchased above shares and therefore it's not needed to account for any losses in LGL accounts. Am I wrong?

But, as per GRAN quarterly statements it is LGL. As we have to rely on GRAN statements LGL has to disclose the fact somehow.

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.

This was discussed sometime back even, its not LGL.. its Laughs Holdings.. The correct one was stated on a news article and GRAN has mistakenly put as LGL..

@ Small Its LGL .. im sure ... its not holdings buddy

Hmmm.. Read the following
http://www.ft.lk/2011/03/04/laugfs-lights-up-bourse/

extract;
"Whilst Laugfs Gas was being under investor spotlight yesterday, its parent Laugfs Holdings on its part had entered the market picking up 1.5 million shares of Citrus Leisure at Rs. 90 per share and around 1 million shares of Ceylon Grain Elevators for Rs. 205 each. Brokers and market analysts said that these were the first equity investments by Laugfs Holdings."

smallville wrote:

Chabbi wrote:

smallville wrote:

Hiru wrote:As per the article, it's Laugfs Holdings that has purchased above shares and therefore it's not needed to account for any losses in LGL accounts. Am I wrong?

But, as per GRAN quarterly statements it is LGL. As we have to rely on GRAN statements LGL has to disclose the fact somehow.

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.

This was discussed sometime back even, its not LGL.. its Laughs Holdings.. The correct one was stated on a news article and GRAN has mistakenly put as LGL..

@ Small Its LGL .. im sure ... its not holdings buddy

Hmmm.. Read the following
http://www.ft.lk/2011/03/04/laugfs-lights-up-bourse/

extract;
"Whilst Laugfs Gas was being under investor spotlight yesterday, its parent Laugfs Holdings on its part had entered the market picking up 1.5 million shares of Citrus Leisure at Rs. 90 per share and around 1 million shares of Ceylon Grain Elevators for Rs. 205 each. Brokers and market analysts said that these were the first equity investments by Laugfs Holdings."

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.
[/quote]- Don't you think this part is valid even though GRAN shares were purchased by the Holding Company. what are the shares included in 424 mn.

smallville wrote:

Chabbi wrote:

smallville wrote:

Hiru wrote:As per the article, it's Laugfs Holdings that has purchased above shares and therefore it's not needed to account for any losses in LGL accounts. Am I wrong?

But, as per GRAN quarterly statements it is LGL. As we have to rely on GRAN statements LGL has to disclose the fact somehow.

Further. during the year ended 31/03/2011, LGL has invested 424 mn in quoted shares and all have been already accounted as long term investments. What ever shares included in this 424mn portfolio, aggregated result would be a loss as the prices of almost all the shares have come down.

This was discussed sometime back even, its not LGL.. its Laughs Holdings.. The correct one was stated on a news article and GRAN has mistakenly put as LGL..

@ Small Its LGL .. im sure ... its not holdings buddy

Hmmm.. Read the following
http://www.ft.lk/2011/03/04/laugfs-lights-up-bourse/

extract;
"Whilst Laugfs Gas was being under investor spotlight yesterday, its parent Laugfs Holdings on its part had entered the market picking up 1.5 million shares of Citrus Leisure at Rs. 90 per share and around 1 million shares of Ceylon Grain Elevators for Rs. 205 each. Brokers and market analysts said that these were the first equity investments by Laugfs Holdings."

I certainly hope it's Laughs Holdings...I have 300k LGL shares which I have collected around 45 levels...at the same time I had the option of purchasing GRAN / TAFL which I avoided because it was highly overvalued at that time. LGL is not a professional investment company and I hope they are not playing with investors money.

Their PBV will be affected as these are balance sheet items. There is no impact from this to their earnings and also PE. The investment is a sunk cost until they realise profit or loss for which they will have to trade the share. But they will take a long time to break even with this investment.