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Sri Lanka Equity Forum » Stock Market Talk » Is this true?

Is this true?

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81Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 9:44 pm

KavinduTM


Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Kipling wrote:Hi Kavindu.So in this context do you have any concerns regards major bull post election. Once market starts making major moves will all retailers forget doubts & join. Hope to know ur take.

Yes but before that we are getting a chance in next month. What did u mean by my take? Shares to buy? What shares do u hold now?

82Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 9:46 pm

Kipling


Manager - Equity Analytics
Manager - Equity Analytics
I meant your view on broader market.

83Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 10:19 pm

KavinduTM


Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Kipling wrote:I meant your view on broader market.

You already have my view. However it's too early to predict further.
90% it will be a huge bull. However mind nothing is 100% guaranteed.
And i think market will pass it's all time high before 2022.

84Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 10:41 pm

Kipling


Manager - Equity Analytics
Manager - Equity Analytics
Agree & my sincere thanks. I feel all time high 7800 will be passed this year. UNP is divided & SP will not be an active campaigner @ GE. So Team GR has an excellent chance to get 2/3.  Bold reforms will flow. Since markets run at least a year before reforms bear fruit the big run will hopefully be in 2020. Hope you share my view.

85Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 10:55 pm

Teller


Moderator
Moderator
Expecting a big stock market ralley is a joke. 2 days earlier another downgraded happened . Sorry for sri ankan economy now. Think fundementally not emotionally

86Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 10:56 pm

KavinduTM

KavinduTM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Kipling wrote:Agree & my sincere thanks. I feel all time high 7800 will be passed this year. UNP is divided & SP will not be an active campaigner @ GE. So Team GR has an excellent chance to get 2/3.  Bold reforms will flow. Since markets run at least a year before reforms bear fruit the big run will hopefully be in 2020. Hope you share my view.

Yeah that's true i agree. We will be able to tell that for sure after GE. ( about passing 7800 level this year )

87Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 10:59 pm

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Teller - within next 5 years SL will start longest bull market ever. not a bubble like 2011.
some massive investors started investing india in billions buffet and bezos

88Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:01 pm

Teller

Teller
Moderator
Moderator
If u want full report, i can provide. Sell what ever you are in profit and keep cash in hand.
ECONOMYNEXT – Standard and Poor’s, a rating agency has downgraded the outlook on Sri Lanka’s ‘B’ rating to ‘negative’ from stable on tax cuts by the new administration but said the ability to pass laws in parliament will improve after elections.

But weak institutions and rising ethnic religious divides were risks.

“The negative outlook reflects our view that Sri Lanka’s fiscal trajectory over the next two to three years could deviate from a fiscal consolidation path,” the rating agency said.

“The sizable deficits will add to Sri Lanka’s already-large debt stock at a faster pace.”

“While political risks have not lifted completely, a government with a clear mandate following the parliamentary elections that are likely to be held in the first half of 2020 could improve investor sentiment and boost growth, in our view.

However the country’s institutions were weak and there were rising ethnic and religious divides.

Sri Lanka’s “institutional settings will remain a credit weakness due to concerns over the sustainability of public finances, centralized policy decision-making and uncertain checks and balances between institutions,” the rating agency said.

“Perceived widening divisions in civil society in recent years, particularly along ethnic and religious lines also increase the risk to political stability, in our view.”

Standard and Poor’s said Sri Lanka had the ability to repay near term debt.

The full statement is reproduced below:

Overview

• We believe that the tax cuts introduced by Sri Lanka’s Cabinet risk undermining fiscal and debt sustainability, even if they boost near-term growth.

• Policy uncertainty will remain elevated ahead of the parliamentary elections. Following the elections, a government with a new mandate could improve legislative efficiency, in our view.

• We are revising our outlook on Sri Lanka to negative from stable, as risks from a deteriorating fiscal position increase. We are affirming our ‘B/B’ sovereign credit ratings on Sri Lanka.

• The negative outlook reflects our view that a larger-than-expected fiscal deficit will increase the government’s financing needs and concerns over debt sustainability.

Rating Action

SINGAPORE (S&P Global Ratings) Jan. 14, 2020–S&P Global Ratings today revised its outlook on the Sri Lanka sovereign credit rating to negative from stable. We affirmed our ‘B’ long-term and ‘B’ short-term foreign and local currency credit ratings on Sri Lanka. The transfer and convertibility assessment is affirmed at B.

Outlook

The negative outlook reflects our view that Sri Lanka’s fiscal trajectory over the next two to three years could deviate from a fiscal consolidation path. The sizable deficits will add to Sri Lanka’s already-large debt stock at a faster pace.

We could lower our ratings over the next 12 months if we believe that the fiscal position could deteriorate further from our current forecast, either due to policy changes or growth underperforming expectations. This will further weaken fiscal sustainability and increase the risks of sudden shifts in investor sentiment or changes in global credit conditions.
We could revise the outlook to stable if we see credible improvements in the fiscal and debt metrics on a sustained basis.

Rationale

Our ratings on Sri Lanka reflect the country’s macroeconomic imbalances, namely weak external profile, sizeable fiscal deficits, and extremely high government indebtedness. Counterbalancing these factors are higher growth prospects. While political risks have not lifted completely, a government with a clear mandate following the parliamentary elections that are likely to be held in the first half of 2020 could improve investor sentiment and boost growth, in our view.

Institutional and economic profile: Growth prospects have improved while political uncertainty will likely ease following parliamentary elections

• Economic growth is likely to improve from its current cyclical weak patch, driven by recovering tourist arrival as well as stronger consumption and investment spending.

• Parliamentary elections could help alleviate uncertainty associated with the persistent factionalism within the current parliament.

Sri Lanka’s economy has been consistently growing below potential in recent years due to a confluence of exogenous shocks and intractable political difficulties. After a brisk uptick in the first quarter of 2019, economic growth was again derailed after the Easter Sunday attacks. Meanwhile, persistent fiscal deficits, a large debt stock, and rising interest servicing cost eroded policy buffers and reduced fiscal capacity to support a slowing economy. We forecast growth in 2019 will slow to 2.7%, the lowest rate in decades.

Barring further unforeseeable exogenous shocks, we expect growth to pick up appreciably to 4% in 2020. This will be supported by several factors. Chiefly, the fiscal stimulus implemented by the interim Cabinet–including steep cuts to the value-added tax (VAT) rate and the elimination of several tax items–is expected to boost private consumption and investment activity.

The tourism sector, which has boomed in recent years, is also likely to see a stronger recovery in the coming quarters. Following sharp declines in arrivals after the attacks, tourist numbers were down merely 4.5% year-on-year in December 2019, which typically marks the start of peak travel season. This will contribute to export performance, which has already benefited from the restoration of the European Union’s Generalized System of Preference Plus facility for the textiles and garments sector this year.

Finally, we believe that parliamentary elections, scheduled to be held in the coming months, could help improve government processes and legislative efficiency, and resolve to a large degree, political uncertainty in the country associated with deep-rooted factionalism within the government.

Persistent political infighting has hindered responsiveness and predictability in policymaking in recent years, and weighed particularly on business confidence, investment plans, and overall growth prospects, in our view.

Nevertheless, even with a new government at the helm, we believe Sri Lanka’s institutional settings will remain a credit weakness due to concerns over the sustainability of public finances, centralized policy decision-making and uncertain checks and balances between institutions.

Perceived widening divisions in civil society in recent years, particularly along ethnic and religious lines also increase the risk to political stability, in our view.

We estimate real per capita income to reach about US$4,200 in 2020 and real GDP growth to average 3.8% in 2019-2022. This translates to real GDP per capita growth of 3.0% on a 10-year weighted average basis. Although this growth rate is in line with peers at a similar income level, it is substantially below Sri Lanka’s growth potential.

Flexibility and performance profile: Fiscal position has deteriorated and risk on debt sustainability has increased

• Sri Lanka’s fiscal position deteriorated following the Easter Sunday attacks. Although a recovery is expected, we expect a widening of the fiscal deficit following the implementation of wide-ranging tax cuts.

• This will likely worsen the government’s heavy indebtedness and add to repayment burdens.

• The external profile remains weak given that the high share of dollar-denominated debt exposes the government to sudden shifts in risk sentiments.

Persistent deficits in Sri Lanka’s fiscal and external positions have been rating constraints. The heavy government debt limits its ability to accumulate policy buffers, which are crucial in times of stress. The government’s fiscal position has weakened over the past year as the Easter Sunday attacks stymied economic activity and reduced tourism earnings.

As a result, government revenue growth came in significantly below initial expectations of a sizeable increase due to the implementation of the Inland Revenue Act (IRA). At the same time, government expenditure also increased due to higher security-related and election spending.

We believe this one-off underperformance on both the revenue and expenditure fronts will now continue over the next few years if the wide-ranging tax cuts announced by the interim Cabinet are implemented without sufficient offsetting measures. The main components of the tax cuts–which involve lowering the VAT rate to 8% from 15% for most sectors, increasing the turnover threshold for VAT by four-fold, and removing the 2% National Building Tax–will likely reduce revenue earnings significantly, in our view.

This will be temporarily cushioned by the government’s intention to curtail expenditure, such as the purchase of vehicles, as well as sizable reduction in the capital expenditure.

We estimate that the overall impact of the tax measures will further widen the fiscal deficit by about 0.8%-1.0% of GDP in 2020, even after taking into account benefits from higher growth prospects. Beyond 2020, we believe it could be difficult for the government to sustain a fiscal consolidation path without new revenue measures. As a base case, we estimate the change in net general government debt to reach 6.7% of GDP on average over 2019-2022. While the risk of large increases in the fiscal deficit could be mitigated by a faster rate of growth, the pace of consolidation will slow.

The tax cuts could also jeopardize progress under the IMF Extended Fund Facility (EFF), which counts the IRA as a key achievement in improving the country’s fiscal settings.

A weaker fiscal position will add to the government’s extremely high debt stock. We do not expect the government to start paring down its debt stock at least until after 2020, depending on the new government’s budget and medium-term fiscal plans. We estimate net general government debt to reach 83.1% of GDP in 2020 while general government interest expenditure is expected to account for 46.1% of revenues. This is the third-highest ratio among the sovereigns we currently rate, trailing only Lebanon and Egypt.


_________________




Teller said is said..

89Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:01 pm

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
to stock market go up people in SL should be standerd. i mean no fucking jvp basterds and enteprenuership and risk taking should be promoted than becoming doctor or proffesional. i see people becoming more standerd. when this reached to a level people will question gvt budgets thoroghly and question money printing fiscal policys. SL basterds becoming smart day by day. sirious 20 year bull market is close to SL.



Last edited by ThilinaM on Fri Jan 17, 2020 11:04 pm; edited 1 time in total

90Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:03 pm

Teller

Teller
Moderator
Moderator
@Thili, dont loose your hard earned money. I know how to calculate the value. you should exit from 90% of listed shares in CSE


_________________




Teller said is said..

91Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:06 pm

KavinduTM

KavinduTM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Teller wrote:Expecting a big stock market ralley is a joke. 2 days earlier another downgraded happened . Sorry for sri ankan economy now. Think fundementally not emotionally

But there is a possibility of a bull run isn't it?

92Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:07 pm

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@teller - I have done calculations from starting inception of CSE. do u have done analysis on returns over 30 year period of CSE ?? 

@kavindu- dont expect a bull run when u invested only 1 or 2 mn. wait and invest 10-20 mn and expect a bull untill satisfy from divident
Very Happy Very Happy Very Happy Very Happy Very Happy



Last edited by ThilinaM on Fri Jan 17, 2020 11:09 pm; edited 1 time in total

93Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:08 pm

Teller

Teller
Moderator
Moderator
Bull factors dead. Only possibility is an artificial bull.

Think differently , why i have entred Apple share in sevaral times.
https://theconversation.com/apples-share-price-has-doubled-but-there-is-a-crunch-coming-investors-should-watch-out-129997


_________________




Teller said is said..

94Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:13 pm

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Teller - i dont understand u people . if your investments making EPS/price 20% y worry regarding bull or bear. take the div and keep the mouth shut they will increase divident little by little

95Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:13 pm

Teller

Teller
Moderator
Moderator
Each 100$ invested, return 100$ + with in a year, even journey is not end. Newly launched Apple pay got huge market attention . Become an analyser not a follower . its 100% no future in CSE 2020-2021. If you believe you can otherwise leave it


_________________




Teller said is said..

96Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:13 pm

KavinduTM

KavinduTM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
I believe this gov will take some straight decisions after GE. which will boost tourism , economy. Almost started to stop importing unnecessary things. We have to produce more and boost exports. Gov will do its job well. I trust on it.

97Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:14 pm

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Teller - what is your best recomendation shares in CSE?? kagalla plantation ???errrr less risky but FD is better.
plantation companys and buiding renting companys growth is limited

98Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:18 pm

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Teller wrote:Each 100$ invested, return 100$ + with in a year, even journey is not end. Newly launched Apple pay got huge market attention . Become an analyser not a follower . its 100% no future in CSE 2020-2021. If you believe you can otherwise leave it
no future in CSE 20 and 21 . i love to here those words. there is mutch time to fill the bucket??

99Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:19 pm

KavinduTM

KavinduTM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
This is the time for a renaissance in CSE. Gov will pay more attention to plantation sector.
And ik most of plantations are dying. But still there's a hope

100Is this true? - Page 5 Empty Re: Is this true? on Fri Jan 17, 2020 11:20 pm

KavinduTM

KavinduTM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@ThilinaM wrote:
@Teller wrote:Each 100$ invested, return 100$ + with in a year, even journey is not end. Newly launched Apple pay got huge market attention . Become an analyser not a follower . its 100% no future in CSE 2020-2021. If you believe you can otherwise leave it
no future in CSE 20 and 21 . i love to here those words. there is mutch time to fill the bucket??

What's lovely with those words? Neutral

101Is this true? - Page 5 Empty Re: Is this true? on Sat Jan 18, 2020 8:42 am

ThilinaM

ThilinaM
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@ kavindu - i have cash flow to invest if market go high i cant use them. i would like market go further down in next years but giving increasing dividents  Laughing Laughing Laughing

102Is this true? - Page 5 Empty Re: Is this true? on Sat Jan 18, 2020 9:08 pm

abey


Manager - Equity Analytics
Manager - Equity Analytics
KAHI GANI DEELA HOTU GANI GATTHA WAGE

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