Sri Lanka - Interesting opportunity for foreigners

Antonym

Antonym

Vice President - Equity Analytics

Posts : 1090
Join date : 2011-02-09

In this post, the writer (Daniel Greenberg) describes Sri Lanka as 'An Emerging Economy that is Increasingly Attractive to Foreign Investors'.

Greenberg cautions that we should stick to our newly created policies - aimed to create a knowledgeable labor force, improve infrastructure, and reduce debt. He concludes that foreign investors recognize our economic improvements and are more willing to invest in the Sri Lankan economy now that the country is more politically stable.

http://bigemergingeconomies.wordpress.com/category/sri-lanka/

Wed Jul 20, 2011 11:37 am by UKboy · Wed Jul 20, 2011 11:37 am by UKboy

RichDad wrote:Sri Lanka received a record $236 million of foreign direct investment in the first quarter of 2011, with the tourism industry attracting most of the inflows, the island’s Board of Investment said June 7.

That is the only escape route BOI has at the moment.
Last few yeas Dialog saved them big time now its only tourism.

Thu Jul 21, 2011 12:04 am by manula · Thu Jul 21, 2011 12:04 am by manula

Academic wrote:

RichDad wrote:Antonym thanks for the update. Hope our market will benefit with these kind of recommendations and true enough rocksan hope the authorities and officials won't do something stupid like that again.

But today papers read, Sri Lanka loses race in hedging payments. How will this US$340 million (Rs. 37.4 billion) case will have an impact on the market?

http://www.sundaytimes.lk/110717/BusinessTimes/bt01.html

Technically this is a legal contact so it is bonded. A party cant deny payments just because a position converted into loosing. The problem with this hedging activity is not considering/hedging downside risk of oil prices. In a way, as someone observed the trend oil barrel behaved at that time, it was commonly expected oil prices go up further. Hence, at the point CPC entered into the agreement, few argued against it. If anyone criticized CPC at that time (before oil price started declining) "my hat-off to him/her".

Further, though not related, I expect oil prices to decline/stabilize in near future as global economy slow down decreases demand for oil. IMHO, this is the point what CPC missed at that time.

Yes.. when the Hedging contract is signing the oil barrel price was going high. but dont foregt chinese company has advcie that time oil barrel price is going to fall.. but no one listen.. and main is no word on oil price fall.. fro mthis only we can get a idea about our officals. Simple newton law.

Thu Jul 21, 2011 5:48 am by Aamiable · Thu Jul 21, 2011 5:48 am by Aamiable

RichDad wrote:Foreigners' eye on SL

S&P revises Sri Lanka outlook to positive, ratings affirmed

Standard & Poor’s Ratings Services yesterday revised its outlook on the long-term foreign currency sovereign credit rating on Sri Lanka to positive from stable.

At the same time, Standard & Poor’s affirmed its ‘B+/B’ foreign currency and ‘BB-/B’ local currency sovereign credit ratings on Sri Lanka. The outlook on the long-term local currency rating is stable. The transfer and convertibility (T&C) assessment is unchanged at ‘B+’.

“We revised our outlook on the foreign currency rating to reflect the improving external liquidity, progress in addressing structural fiscal weaknesses, the Government’s effort to keep inflation near that of trading partners,” said Standard & Poor’s credit analyst Takahira Ogawa.

“We expect investment to edge upward to 28% of GDP, boosting per capita growth to about 6.5% per year. If the business environment improves to boost net foreign direct investments above 2% of GDP, stronger growth may be possible,” Ogawa said.

http://www.ft.lk/2011/07/20/sp-revises-sri-lanka-outlook-to-positive-ratings-affirmed/

In the meantime, if quarterly financials also maintain standards, ...positive trend in CSE can be achieved. ......Good financial reports seem to be emerging... one by one.

Smile

Fri Jul 22, 2011 1:57 am by UKboy · Fri Jul 22, 2011 1:57 am by UKboy

1000% true.

https://www.youtube.com/watch?v=bmYuTRma7yI

Fri Jul 22, 2011 2:46 am by RichDad · Fri Jul 22, 2011 2:46 am by RichDad

Aamiable wrote:
In the meantime, if quarterly financials also maintain standards, ...positive trend in CSE can be achieved. ......Good financial reports seem to be emerging... one by one.

Yes, the value gems will never let the sophisticated investors down who had faith on them.
Longing to see the some good quarterly reports one by one... pirat

Fri Jul 22, 2011 5:33 am by Aamiable · Fri Jul 22, 2011 5:33 am by Aamiable

RichDad wrote:

Aamiable wrote:
In the meantime, if quarterly financials also maintain standards, ...positive trend in CSE can be achieved. ......Good financial reports seem to be emerging... one by one.

Yes, the value gems will never let the sophisticated investors down who had faith on them.
Longing to see the some good quarterly reports one by one...

reports alone is not adequate.. CSE need new funds and medium to long term investments....Foreign investors enter only if there is a strong and persistent upward trend in the ASI and MPI............... Regulators and local investors need to maintain an upward trend for some time. ……………recently, when there were bouts of foreign buying CSE appeared green………… Local funds and PLCs should be able to maintain momentum for some time to attract further investments. …………..Investors should be able to recover investment cost and gain some profits to maintain investor confidence……. In the eyes of investors CSE is competing with other stock exchanges in the world………... IMF is observing. ………..improving indices in the stock exchange is vital for good image of a nation………