[Corporate]

Ceybank Unit Trust reports 121 percent growth

*Share trading profit Rs.615m in FY 09/10

*Distributes Rs.157m dividends

Ceybank Unit Trust, the equity linked Unit Trust Fund with net assets over Rs.3,700 million as at end March 2010, and managed by Ceybank Asset Management, has performed admirably to report 121percent growth (net asset value per unit) during the financial year ending 31st March 2010.

"This performance of over 120percent was possible due to the aggressive growth oriented investment strategy taken by the Fund Managers", said CEO/Executive Director Ceybank Asset Management Chitra Sathkumara.

The Manager, CeybankAML, with the concurrence of the Trustee to the Fund, Bank of Ceylon, have announced an increased dividend of Rs. 1/= per unit to all registered unit holders of the Fund as at 31st March 2010.

This amounts to an increase of 100percent over the previous year's dividend of -/50 cents per unit. Based on the Ceybank Unit Trust offer price as at 1st April 2009, this gives a dividend yield of 8.6% to unit holders in addition to capital appreciation.

The Fund realised its biggest ever trading profit of Rs. 615 million as capital gains from share trading during FY 09/10, up 383% from Rs. 127 million in the previous year.

The Manager has decided to utilise Rs. 157 million for distribution for the FY 09/10. Unit holders have the option to reinvest this dividend in the Fund without the usual 5% front-end fee. A majority of investors re-invested their dividends in the Fund expecting more capital growth, said Sathkumara.

Those who invested Rs.100,000/= in Ceybank Units on 31st March 2009 could have earned Rs.211,665/= by 31st March 2010.

If they had invested the money in a savings account at 6% interest p.a., they would have earned only Rs.106,000/= or in a fixed deposit at 12percent p.a. only Rs.112,000/=.

The Fund was launched in March 1992 by the Unit Trust Management Company Ltd (UTMCL).

Bank of Ceylon, Merchant Bank of Sri Lanka, Carson Cumberbatch, Unit Trust of India and HSBC Asset Management promoted UTMCL.

However, in late 2001 Sri Lanka Insurance Corporation acquired the Merchant Bank of Sri Lanka's stake in UTMCL. BoC acquired HSBC shareholding. Carsons also divested part of their holding to BOC and SLIC. With the BoC becoming the largest shareholder, UTMCL changed its name to Ceybank Asset Management.

The Fund Manager, with the intention of achieving capital growth with the expected upward movement of the market in the medium term, has done major changes in asset allocation.

Taking advantage of the down turn in the market, some of the blue chip shares of potential value, specially in the Hotel Sector, have been aggressively acquired at very low prices.

The Fund's investment in the equity has been increased to gain from the expected post war rally in the Colombo Stock Market.

Investments are well diversified and the equity is heavily weighted towards Hotels and Manufacturing sectors.

These sectors are expected to rebound and therefore, Ceybank Unit Trust is well placed to take advantage of the expected upward market movement.

This aggressive strategy paid off as shown by the exceptional performance.

During the year 2010, the ASI has grown by 36percent and Ceybank Unit bid price appreciated by 44%, up to end June. Investors of Ceybank Units can expect fair capital gains in the medium term, said Sathkumara.

Logan Rockefeller to explore Lankan market

by Lalin FERNANDOPULLE

Sri Lanka has huge potential to be a major frontier market backed by the favourable business environment in the country, said Managing Partner, LR Global, Don LaGuardia at a ceremony to launch Logan Rockefeller Global Lanka Asset Management Company in Colombo on Wednesday.

LR Global, a New York based investment company will invest around Rs. 2.5 billion for its initial operations in Sri Lanka and then hopes to increase its allocation with the expansion of business in the country.

"It is the best time to invest in Sri Lanka and we are excited about its operations. We are confident the investment will bring the desired results", LaGuardia said.

"The company will bring portfolio investments to Sri Lanka and will support listing of new companies through making sizable investments, pre IPO and secondary market investments in the stock market", he said.

LR Global has invested over US$ 1.5 billion in frontier markets during its 13 years operation across the globe and has helped turn around faltering businesses.

Logan Rockefeller Global Lanka Asset Management which had a soft opening recently commenced operations on Wednesday at the 34th floor of the World Trade Centre.

LaGuardia said he had been visiting Sri Lanka since last September and has seen the immense investment opportunities in the country.

"We are looking at investing in port and construction companies and already agreements have been made with certain companies", he said.

Managing Director, LR Global Lanka Asset Management (Pvt) Ltd., Channa De Silva said that Sri Lanka has a huge market for investments and the company will benefit from peace dividends.

"We are keen to promote a considerable amount of IPOs during the first few years through investing in unlisted entities and then hope to get them onto the stock exchange", De Silva said.

LR Global set up its unit in Sri Lanka to channel overseas investments into private placements and private equity.

The Bangladesh Asset Management company was launched to explore the growing market in the country.

Chairman, Logan Rockefeller Global Lanka Asset Management (Pvt) Ltd., Allen Pathmarajah said the political stability, low interest rates and the flow of foreign remittances are favourable to Sri Lanka to grow faster than Bangladesh.

LR Global was launched in 1997 during the height of the Asian financial crisis and today its operation covers 35 frontier markets and listed securities across the globe.

Pathmarajah said LR Lanka Strategic Investment (Pvt) Ltd, a company to invest money will be listed in the Colombo Stock Exchange.

LR Global helps businesses and governments across the globe to solve problems and develop strategies to reach their full potential.