N D B Securities (Pvt) Ltd,

5th Floor,
# 40, NDB Building,
Nawam Mawatha,
Colombo 02.
Tel: +94 11 2131000
Fax: +9411 2314180
Buy
We expect the counter to outperform the broader market. Recommend adding/increasing exposure to the stock at current prices.
Hold
We do not expect the counter to significantly outperform the broader market. Recommend reducing holdings of the share by 50% in case of a downgrade. Maintain
current exposure in case of an upgrade.
Underweight
We expect the counter to underperform the market and recommend reducing holdings by 90%.
Q UA R TER LY FINA NCIA LS
23-Mar -15

13.89

B an k an d Fi n an ce

10.27

Stock Tracker

mt hs Q TR Mk t . Pr i ce

Sh ar es

Mar k et

2014

20-Mar -15
265.00
178.00
138.00
215.00
32.10
234.00
184.00
153.60
78.00
42.50
259.00
105.00
24.00
1.10
0.40
23.50
269.20
101.00
65.70
46.50
89.00
168.00
300.00
1,620.00
602.10
23.00
22.90
120.00
85.00
75.10

(Mn)
104.88
810.28
55.58
265.10
101.25
321.74
80.86
69.26
475.20
50.00
164.60
230.61
67.50
1,191.77
614.07
295.04
167.91
175.98
168.98
41.55
50.00
85.71
30.75
20.00
6.41
1,579.86
363.00
37.76
46.30
8.01

Cap
27,794
144,229
7,670
56,996
3,250
75,286
14,878
10,638
37,066
2,125
42,632
24,214
1,620
1,311
246
6,933
45,201
17,774
11,102
1,932
4,450
14,400
9,225
32,400
3,862
36,337
8,313
4,532
3,935
601

NP (mn )
2,758.18
11,238.89
11,238.89
3,537.72
1,048.40
9,819.60
9,819.60
1,554.00
3,767.10
188.14
4,133.93
2,536.58
(104.90)
91.11
91.11
415.21
5,263.24
3,178.78
3,178.78
252.82
417.73
1,203.06
352.44
2,547.95
2,547.95
2,978.00
1,061.41
504.45
467.30
467.30

B ever age Food an d Tobacco

BFL
9
Dec
110.00
CA RG
9
Dec
139.00
CCS
9
Dec
280.00
CT C
12 Dec
1,030.00
COCO
9
Dec
26.90
COCO-x
9
Dec
23.50
DIST
9
Dec
240.00
K FP
9
Dec
105.00
NEST
12 Dec
2,320.00
T SML
9
Dec
43.50
LA MB
9
Dec
60.10
LION
9
Dec
625.00
LMF
9
Dec
136.00

16.00
224.00
95.04
187.32
89.77
4.77
300.00
25.50
53.73
30.00
31.40
80.00
40.00

1,760
31,136
26,611
192,943
187.67
112
72,000
2,678
124,643
1,305
1,887
29,608
5,440

Ch emi cal an d Ph ar maceu t i cal s

CIC
9
Dec
77.00
CIC-x
9
Dec
61.00
HA Y C
9
Dec
176.00

72.90
21.87
29.71

Con st r u ct i on an d En gi n eer i n g
DOCK
12
Dec
175.00
A EL*
9
Dec
21.80

71.86
1,000.00

CFIN
COMB*
COMB-x
DFCC
CFVF
HNB*
HNB-x
LFIN
LOLC
LVEN
NDB
NT B*
PMB
SEMB
SEMB-x
PA BC
SA MP*
SEY B
SEY B-x
VFIN
HA SU
UA L
CT CE
CINS
CINS-x
PLC
JINS
SDB
CDB
CDB-x

9
12
12
9
9
12
12
9
9
9
12
12
9
12
12
12
12
12
12
9
12
12
12
12
12
9
12
12
9
9

Di ver si f i ed
CA RS
HA Y L
HHL
JK H*
RICH
SPEN
EX PO
SHL
SUN

9
9
9
9
9
9
9
9
9

Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec

NP (mn )
2,450.68
10,563.38
10,563.38
1,979.35
248.58
7,650.47
7,650.47
784.63
1,293.72
159.58
2,641.93
2,136.40
(131.89)
72.96
72.96
113.84
3,634.96
2,326.15
2,326.15
203.79
389.12
1,123.41
499.29
2,609.18
2,609.18
2,305.00
1,005.51
248.18
428.84
428.84

64.12
278.96
924.25
8,619.00
120.02
120.02
5,316.08
182.22
3,786.89
38.39
66.30
1,581.38
122.74

5,613
1,334
5,229

602.30
602.30
415.54

12,575
21,800

289.85
1,713.24

385.00
305.00
75.00
207.00
8.00
101.00
8.70
14.00
50.50

196.39
75.00
515.29
999.62
2,035.04
406.00
1,954.92
779.00
133.83

75,609
22,875
38,647
206,922
16,280
41,006
17,008
10,906
6,758

2,488.39
1,694.09
1,155.48
9,125.70
1,293.10
2,195.29
669.35
322.51
408.25

Foot wear an d Text i l es

MGT
9
Dec

17.80

207.74

3,698

53.85

H eal t h car e
A MSL
LHCL
A SIR
NHL

16.60
42.90
20.70
3.00

528.46
223.73
1,099.09
1,409.51

8,772
9,598
22,751
4,229

102.20
461.57
770.70
119.68

9
12
9
9

Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec

Dec
Dec
Dec
Dec

2013

Gr owt h

Net A sset s

ROE

EPS

A n n u al i sed

DPS

DY

1.18
2.16
1.68
1.19
1.27
1.39
1.09
1.44
1.36
1.50
1.53
1.74
1.72
1.88
0.68
1.46
1.31
1.38
0.90
1.38
1.84
2.32
1.89
2.13
0.79
1.74
1.60
0.96
1.20
1.06

3.20
4.50
4.50
5.50
4.00
8.50
8.50
6.50
0.50
1.00
11.00
2.10
5.00
2.50
2.50
1.00
3.75
6.50
2.00
20.00
20.00
1.25
2.00
12.00
3.00
3.00

1.2%
2.5%
3.3%
2.6%
12.5%
3.6%
4.6%
4.2%
0.6%
2.4%
4.2%
2.0%
0.0%
0.0%
0.0%
0.0%
1.9%
2.5%
3.8%
2.2%
4.2%
3.9%
0.7%
1.2%
3.3%
5.4%
8.7%
10.0%
3.5%
4.0%

116.42
54.71
104.45
20.81
29.26
29.26
204.95
63.05
76.09
28.96
30.13
102.32
258.98

0.94
2.54
2.68
49.50
0.92
0.80
1.17
1.67
30.49
1.50
1.99
6.11
0.53

1.25
2.00
6.00
48.75
0.30
0.30
3.25
2.00
60.00
1.00
4.00
1.50

1.1%
1.4%
2.1%
4.7%
1.1%
1.3%
1.4%
1.9%
2.6%
2.3%
0.0%
0.6%
1.1%

9.25
9.09
7.20
9.44

74.82
74.82
179.88

1.03
0.82
0.98

2.00
2.00
6.00

2.6%
3.3%
3.4%

289.85
2,870.00

10.88
43.39
7.60

152.65
15.62

1.15
1.40

4.00
0.75

2.3%
3.4%

236.79
334.37
28.69
130.97
4.71
82.57
5.35
9.47
38.35

1.63
0.91
2.61
1.58
1.70
1.22
1.63
1.48
1.32

2.00
5.00
1.00
3.50
0.45
2.00
0.33
0.16
0.95

0.5%
1.6%
1.3%
1.7%
5.6%
2.0%
3.8%
1.1%
1.9%

13%
6%
6%
79%
322%
28%
28%
98%
191%
18%
56%
19%
20%
25%
25%
265%
45%
37%
37%
24%
7%
7%
-29%
-2%
-2%
29%
6%
103%
9%
9%

(mn )
23,466.43
71,205.83
71,205.83
48,020.77
2,558.49
67,904.57
67,904.57
7,398.93
27,199.92
1,476.29
27,875.77
13,894.53
941.92
1,055.74
1,055.74
4,734.63
34,511.34
25,195.20
25,195.20
1,404.85
2,413.94
6,210.86
4,886.67
20,083.61
20,083.61
20,866.00
5,206.64
4,695.97
3,860.74
3,860.74

17%
17%
17%
11%
63%
14%
14%
30%
20%
18%
16%
20%
-14%
9%
9%
9%
16%
13%
13%
26%
18%
21%
7%
13%
13%
20%
22%
12%
17%
17%

35.06
13.27
13.27
17.79
13.81
22.51
22.51
29.92
10.57
5.02
25.11
11.02
(2.07)
0.05
0.05
1.41
31.54
9.21
9.21
8.11
8.35
14.04
11.46
96.46
96.46
2.51
2.92
13.36
11.47
11.47

84.21
325.33
572.91
9,140.00
56.61
56.61
4,882.35
(58.70)
3,316.75
60.92
50.38
948.07
141.69

-24%
-14%
61%
-6%
112%
112%
9%
410%
14%
-37%
32%
67%
-13%

1,862.75
12,254.71
9,927.07
3,898.00
2,766.26
2,766.26
61,485.35
1,607.89
4,087.93
868.67
946.20
8,185.63
10,358.84

5%
3%
12%
210%
6%
6%
12%
15%
91%
6%
10%
28%
2%

5.34
1.66
12.97
46.01
1.69
1.69
23.63
9.53
70.49
1.71
2.82
26.36
4.09

85.49
371.95
1,232.33
8,619.00
151.95

(345.81)
(345.81)
551.63

274%
274%
-25%

7,090.96
7,090.96
5,344.62

12%
12%
11%

-69%
-18%

10,969.43
15,623.51

3%
19%

926.08
2,090.84

Ear n i n gs
3,677.57
10,752.39

A n n u al i sed

BV

PER
7.56
13.41
10.40
12.08
2.33
10.40
8.17
5.13
7.38
8.47
10.31
9.53
(11.58)
21.80
7.93
16.70
8.54
10.96
7.13
5.73
10.65
11.97
26.17
16.79
6.24
9.15
7.83
8.98
7.41
6.55

223.74
82.24
82.24
181.14
25.27
168.67
168.67
106.83
57.24
29.53
169.35
60.25
13.95
0.58
0.58
16.05
205.53
73.04
73.04
33.81
48.28
72.46
158.92
760.33
760.33
13.21
14.34
124.35
71.09
71.09

7,088.11
242.97
3,786.89
51.19
88.39
2,108.50
163.65

20.43
20.59
83.71
21.59
22.39
15.89
13.88
10.16
11.02
32.91
25.49
21.35
23.71
33.24

8.47
8.47
18.65

617.74
185.32
554.05

4.03
2.87

4,716.95
1,397.87
7,242.29
2,072.00
5,022.80
250.86
4,133.93
2,541.29
(139.86)
60.13
415.21
5,295.42
1,621.61
337.09
417.73
1,203.06
352.44
1,929.21
3,970.67
1,061.41
504.45
531.21
91.86

PB V

185%
38%
-22%
30%
35%
-5%
-50%
64%
-5%

46,501.63
25,078.11
14,782.48
130,924.39
9,584.85
33,523.53
10,450.98
7,376.24
5,132.39

7%
9%
11%
10%
19%
9%
9%
6%
11%

16.89
30.12
2.99
12.60
0.85
7.21
0.46
0.55
4.07

3,317.85
2,258.78
1,540.64
12,595.27
1,724.13
2,927.05
892.47
430.02
544.33

16.62
22.79
10.13
25.08
16.43
9.44
14.01
19.06
25.36
12.42

(94.68)

157%

2,006.56

4%

0.35

71.80

51.50
51.50

9.66

1.84

125.15
676.77
709.03
235.89

-18%
-32%
9%
-49%

3,334.90
4,392.51
5,668.06
3,938.06

4%
11%
20%
4%

0.26
2.06
0.93
0.11

136.27
461.57
1,027.60
159.57

25.41
64.37
20.79
22.14
26.50

6.31
19.63
5.16
2.79

2.63
2.19
4.01
1.07

872.34
1,225.61
1,472.87
7,040.32
956.34
2,306.60
1,344.86
196.27
428.75

Research Team Sidath Kalyanaratne, Dhinali Peiris, Vaishalie Shakespeare, Raguram Raamakrishnan, Tharindra Gooneratne, Upul Atapattu

1.56
1.50
0.55
0.06

0.0%

9.4%
3.5%
2.7%
2.0%

H O LD

B UY

H O LD

H O LD

H O LD

B UY

H ot el s an d Tr avel s
mt hs Q TR Mk t . Pr i ce
20-Mar -15
A HPL
9
Dec
64.00

Sh ar es
(Mn )
442.78

Mar k et
Cap
28,780

2014
NP (mn )
1,252.61

2013
NP (mn )
1,563.00

Gr owt h
%
-20%

Net A sset s
(mn )
22,282.47

ROE

EPS

7%

3.77

A n n u al i sed
Ear n i n gs
2,213.88

15.12
A n n u al i sed
PER
16.97

BV

PB V

DPS

DY

50.32

1.27

4.00

6.3%

A HUN
HSIG
K HL
SHOT
SHOT -x

9
9
9
9
9

Dec
Dec
Dec
Dec
Dec

71.50
96.00
15.70
32.10
21.20

336.29
5.86
1,456.15
75.51
36.01

24,045
562
22,862
2,424
763

1,134.54
27.23
888.49
61.95
61.95

1,118.88
7.54
598.07
(20.19)
(20.19)

1%
261%
49%
407%
407%

15,949.97
291.87
18,721.57
2,056.62
2,056.62

10%
13%
8%
4%
4%

4.50
6.20
0.95
0.74
0.74

1,512.72
36.30
1,383.34
55.93
26.67

15.90
15.49
16.53
43.34
28.63

47.43
49.82
12.86
18.44
18.44

1.51
1.93
1.22
1.74
1.15

1.50
-

2.1%
0.0%
0.0%
0.0%
0.0%

In vest men t
GUA R
RHL
RHL-x

Tr u st
9
Dec
9
Dec
9
Dec

194.50
29.00
24.30

87.84
89.03
12.86

17,084
2,582
312

1,508.06
211.45
211.45

858.58
164.72
164.72

76%
28%
28%

23,933.76
4,073.07
4,073.07

9%
8%
8%

22.89
2.77
2.77

2,010.75
246.36

8.71
8.50
10.48
8.78

272.48
39.97
39.97

0.71
0.73
0.61

5.00
0.70
0.70

2.6%
2.4%
2.9%

Lan d an d Pr oper t y
CLND
12 Dec
OSEA
12 Dec
PDL
12 Dec

28.00
25.80
95.00

199.88
843.48
66.00

5,597
21,762
6,270

(47.09)
3,343.29
407.22

61.60
2,641.31
430.81

-176%
27%
-5%

2,709.54
25,944.24
3,538.27

-2%
7%
12%

(0.24)
2.12
6.17

(47.09)
1,790.94
407.22

15.63
(118.86)
12.15
15.40

13.56
30.76
53.61

2.07
0.84
1.77

1.00
3.00

0.0%
3.9%
3.2%

78.00
133.30
142.00
36.00
5.80
400.00
78.10
98.50
114.50
80.00
107.90
54.00
37.50
24.50

59.89
30.00
59.86
60.00
950.09
120.00
21.80
54.60
110.79
80.40
53.05
222.75
111.38
660.75

4,672
3,999
8,500
2,160
5,510
48,000
1,703
5,378
12,685
6,432
5,724
12,029
4,177
16,188

436.77
429.54
852.22
79.55
230.78
2,746.83
50.03
668.68
1,281.49
550.38
533.51
1,346.87
1,346.87
821.94

333.73
189.94
578.91
123.83
221.77
2,531.90
384.13
321.96
366.01
480.61
452.28
1,722.17
1,722.17
804.97

31%
126%
47%
-36%
4%
8%
-87%
108%
250%
15%
18%
-22%
-22%
2%

6,493.56
3,844.41
7,955.53
2,851.56
3,421.73
5,199.21
2,471.52
6,171.33
11,459.15
2,708.49
3,869.06
9,859.91
9,859.91
6,785.91

9%
15%
15%
3%
9%
55%
3%
22%
16%
29%
29%
19%
19%
18%

9.72
19.09
18.98
1.33
0.32
22.89
3.06
24.49
15.42
9.13
20.11
5.37
5.37
1.76

582.36
572.72
1,136.29
79.55
307.71
2,746.83
66.71
1,337.36
1,708.65
733.84
1,067.02
1,197.22
1,162.92

10.47
8.02
6.98
7.48
27.15
17.91
17.47
25.52
4.02
7.42
8.76
5.36
10.05
6.98
13.92

108.42
128.15
132.90
47.53
3.60
43.33
113.37
113.03
103.43
33.69
72.93
29.51
29.51
10.27

0.72
2.75
1.07
0.76
1.61
9.23
0.69
0.87
1.11
2.37
1.48
1.83
1.27
2.39

1.00
5.50
0.14
0.38
15.00
1.50
3.00
1.00
1.65
4.00
1.30
1.30
1.30

1.3%
0.0%
3.9%
0.4%
6.6%
3.8%
1.9%
3.0%
0.9%
2.1%
3.7%
2.4%
3.5%
5.3%

1,011.87
84.34

0.61
1.10

10.00
12.00

1.6%
12.9%

Man u f act u r i n g
A CL
9
CERA
9
DIPD
9
GRA N
12
GLA S
9
LLUB
12
K CA B
9
LW L
6
RCL
9
T Y RE
9
T ILE
6
TK Y O
9
T K Y O-x
9
T JL*
9
Mot or s
DIMO
UML

Dec
Dec
Dec
Dec
Dec
Dec
Dec
Sept
Dec
Dec
Sept
Dec
Dec
Dec

9
6

Dec
Sept

621.00
93.00

8.88
100.90

5,512
9,384

333.17
722.94

187.19
1,419.79

78%
-49%

8,981.79
8,510.43

5%
17%

50.05
14.33

444.23
1,445.87

7.88
12.41
6.49

O i l Pal ms
BUK I
9

Dec

684.00

102.00

69,768

1,625.12

375.82

332%

29,215.49

7%

21.24

2,166.83

32.20
32.20

286.43

2.39

3.00

0.4%

111.34
143.93
79.55
91.36
24.47
67.60
18.10
64.88
13.53
42.21

0.19
0.63
0.83
0.92
0.45
0.54
1.10
0.41
0.85
0.48

1.00
13.50
3.50
10.50
3.00
0.75
2.50
0.10
0.75

4.8%
14.9%
5.3%
12.5%
0.0%
8.2%
3.8%
9.3%
0.9%
3.7%

Pl an t at i on s
BA LA
12
K GA L
9
K VA L
12
NA MU
9
MA SK
9
T PL
12
WATA
9
K OT A
9
BOPL
9
ELPL
9

-176%
-50%
-39%
-41%
48%
3%
32%
-39%
345%
-20%

2,631.73
3,598.22
2,704.86
2,169.87
1,320.47
1,605.51
4,283.93
2,595.39
1,132.84
3,075.48

-4%
6%
-17%
9%
-9%
11%
13%
-22%
16%
10%

(4.29)
8.73
(13.78)
7.98
(2.19)
7.51
2.30
(15.62)
2.00
4.06

(101.33)
218.31
(468.64)
189.53
(118.40)
178.40
545.03
(624.86)
167.75
295.76

17.22
(4.83)
10.36
(4.79)
10.50
(4.97)
4.86
8.68
(1.72)
5.74
4.98

275.31
630.20
197.39
4,090.56
1,269.54
1,269.54

-129%
42%
83%
-28%
-15%
-15%

2,433.82
2,515.32
1,435.00
19,190.93
7,530.48
7,530.48

-4%
53%
37%
22%
20%
20%

(0.84)
1.60
1.01
7.38
3.72
3.72

(105.47)
1,195.35
480.42
3,928.99
1,245.44
193.32

6.99
(22.55)
5.06
6.66
5.86
10.06
8.90

19.44
3.37
3.01
36.04
19.46
19.46

0.98
2.41
2.23
1.20
1.92
1.70

1.40
0.60
0.10
2.00
2.00
2.00

7.4%
7.4%
1.5%
4.6%
5.3%
6.0%

6,097.75
6,001.00

5,201.03
5,419.00

17%
11%

44,832.29
63,900.00

14%
10%

0.75
3.32

6,097.75
6,001.00

14.19
14.69
13.68

5.51
35.40

2.00
1.29

0.58
0.85

5.3%
1.9%

1,084.62
110.34
714.21

387.91
135.15
462.09

180%
-18%
55%

15,021.62
1,766.80
5,475.21

10%
8%
14%

20.40
4.09
5.70

1,446.16
147.12
714.21

10.22
5.10
12.35
20.16

211.95
49.09
43.73

0.49
1.03
2.63

0.50
3.00
2.50

0.5%
5.9%
2.2%

Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec
Dec

20.70
90.50
66.00
83.80
10.90
36.50
20.00
26.90
11.50
20.20

23.64
25.00
34.00
23.75
53.95
23.75
236.67
40.00
83.75
72.87

489
2,263
2,244
1,990
588
867
4,733
1,076
963
1,472

(101.33)
163.73
(468.64)
142.15
(88.80)
178.40
408.77
(468.64)
125.82
221.82

Power an d En er gy
HPW R
9
Dec
VPEL
9
Dec
VLL
9
Dec
LIOC
9
Dec
LGL
9
Dec
LGL-x
9
Dec

19.00
8.10
6.70
43.20
37.40
33.10

125.20
747.11
477.27
532.53
335.00
52.00

2,379
6,052
3,198
23,005
12,529
1,721

(79.10)
896.51
360.32
2,946.74
1,079.07
1,079.07

Tel ecommu n i cat i on s

DIA L
12 Dec
SLT L
12 Dec

11.00
45.50

8,143.78
1,804.86

89,582
82,121

104.00
50.50
115.00

70.88
35.99
125.21

7,371
1,817
14,399

Tr adi n g
BRW N
CW M
SINS

9
9
12

Dec
Dec
Dec

* For ecast EPS

** EPS adj u st ed f or cycl i cal i t y
A n n u al i sed r esu l t s ar e con si der ed i n al l ot h er cases

132.65
324.98
(336.27)
242.86
(170.07)
173.53
310.68
(336.27)
(51.40)
277.22

B UY

H O LD
H O LD

B UY

H O LD

H O LD

Recommendations
J K H - Buy
JK H group PA T grew by 25.3% and profit attributable to the equity holders grew by 27.6% in Q3FY14/15 over the previous year. The consumer foods & retail sector continued to perform exceptionally
well in Q3FY14/15 recording an increase of 165.0% YoY in profit after tax mainly due to the restructuring in the retail chain and the positive growth in the consumer food segment. The transportation
segment, South A sia Gateway Terminals recorded a YoY increase in overall volumes and domestic throughput in Q3FY14/15. Property segment also recorded an increase with the OnThree20
completion. The leisure performance has been marginally low mainly due to the local presidential elections and the foreign political instability. However, we expect significant growth in this segment in
the next couple of years. Considering the improving performance and the pricing, we recommend BUY.
TJ L - Buy
TJL recorded an impressive YoY top line and bottom line growth of 12.0% and 24.0% respectively in 3QFY14/15. Sales revenue crossed Rs 3.7 Bn due to higher demand during the festive months from
its main customers, which became a possibility to cater to by working at full capacity after the 10-12% capacity increment. Furthermore, the growth in demand enabled TJL to improve its product mix
and achieve higher production efficiencies by operating at optimal capacity. TJL continued to maintain its near debt free balance sheet with a net cash position of LK R 1.65 Bn. However, due to
increased levels of investment and working capital the net cash balance was 29% down YoY. The new boiler plant is expected to commence operations in the quarter to follow.

NTB - Hold
For the quarter ended December FY14, group profit declined by 7.3% YoY to LK R 0.5 Bn. During the quarter, the groups net interest income and net fee income (mainly credit cards) increased by 9.4%
YoY to LK R 2.4 Bn and 15.3% YoY to LK R 0.8 Bn respectively. The groups loans and deposits increased during FY14 by 19.5% to LK R 98.3 Bn and 16.0% to LK R 111.0 Bn respectively. Reverse repo
also increased fromLK R 0.6 Bn (end 2013) to LK R 11.0 Bn (end 2014). A s at end FY14, groups total capital adequacy ratio and gross NPL slightly deteriorated to 18.3% and 4.1% respectively. A s per
the bank, NTB may be liable to pay super gain tax since the bank made a profit in excess of LK R 2.0 Bn for the said year of assessment.
K HL - Buy
K HL reported revenue growth of 0.2% in Q3FY14/15. Sri Lankan resorts positively contributed, up by 1.9% , and Maldivian resort operation contracted by 1.2% over corresponding period in Q3FY13/14.
PA T dropped by 7.5% in comparison to Q3FY13/14 mainly due to the local presidential elections and the foreign political instability in certain target destinations. However QoQ Revenue and PA T
surged by 7.5% and 22.1% respectively. The company has retired LK R 2.1 Bn worth of interest bearing borrowings since Q3FY13/14 which is reflected in 47.7% reduction in interest paid during
Q3FY14/15 compare to corresponding quarter in FY13/14. Considering low P/BV, leverage and improved sentiment in tourism sector both in Sri Lanka and Maldives, we expect this counter to perform
well in forthcoming quarter. Hence we reiterate BUY recommendation.

COMB - Hold
For the quarter ended December FY14, group profit attributable to equity holders increased by 2.2% YoY to LK R 3.4 Bn. During the quarter, the groups net interest income and net fee income increased
by 12.6% YoY to LK R 7.3 Bn and 22.8% YoY to LK R 1.4 Bn respectively. However, net gains from financial investments declined by 42.6% YoY to LK R 0.8 Bn. The loan and deposit growths were 21.2%
and 17.3% respectively during FY14. The group CA SA increased from 43.5% (Dec 13) to 48.4% (Dec 14). During the year, other borrowings that includes securities sold under repo increased by
151.9% to LK R 136.0 Bn. A s at end FY14, banks total capital adequacy ratio and gross NPL were 16.0% and 3.5% . Commercial Bank will account for the super gain tax liability once the legislation is
introduced with the measurement criteria.
AEL - Hold
A ELs revenue and profit declined in 3Q FY14/15 by 5.3% and 16.4% respectively. The engineering segment recorded a significant 42.7% decline in revenue. This decline was negated by the new
source of revenue to the group, A ccess Projects which contributed LK R 955.59 Mn to the top line and LK R 107.75 Mn to the bottom line for the quarter. Sale of production related material recorded an
impressive 38.5% QoQ growth in revenue. Sathosa Motors experienced a dip in revenue of 4.0% QoQ in 3Q FY14/15 due to a drop in overall Isuzu and Range Rover registrations in the country.

LIOC - Hold
LIOC recorded a less than impressive performance for 3QFY14/15 with YoY drop in Revenue and PA T by 4.5% and 51.4% respectively. A dmin expenses increased by 27.7% , while finance cost
increased by 391.1% to 149.8 Mn over the corresponding period of FY13/14. Borrowings increased by 121.8 Mn since 3QFY13/14 whilst cash and cash equivalents increased by 73.5% to LK R 8.0 Bn.
This represents 28.9% of total assets as at 31st December, 2014.
However, LIOC is trading at a trailing P/E of 6.78 and P/BV of 1.39 as of 3QFY13/14, well below the sector and market multiples. Given the duopoly nature of the business and rebound in economic
activities, we remain positive on the fundamentals of the counter. Hence, we reiterate our previous recommendation of HOLD.

HNB - Buy
For the quarter ended December FY14, group profit attributable to equity holders increased by 93.4% YoY to LK R 3.6 Bn. During the quarter, the groups net interest income and net fee income
increased by 6.9% YoY to LK R 7.1 Bn and 24.7% YoY to LK R 1.2 Bn respectively. However, net gains from financial investments increased by 510.2% YoY to LK R 383.3 Mn. The groups loan and
deposit growths were 14.1% and 10.0% respectively during FY14. A s at end FY14, banks total capital adequacy ratio and gross NPL were 14.8% and 3.2% . Hatton National Bank is liable to pay the
super gain tax liability and will account for it once the legislation is introduced with the measurement criteria. Detailed earnings update will be released in due course.

SAMP - Hold
For the quarter ended December FY14, group profit attributable to equity holders increased by 23.0% YoY to LK R 1.3 Bn. During the quarter, the net interest income for the group increased by 0.7%
YoY to LK R 4.3 Bn. The collective impairment decreased by 94.8% to LK R 79.4 Mn. However, net trading income declined by 239.3% to a loss of LK R 35.8 Mn. The loan growth and deposit growth was
16.4% and 13.1% respectively during FY14. The group loan portfolio exposure on pawning has reduced from 20.3% (end 2013) to 8.1% (end 2014). Total capital adequacy ratio and gross NPL were
13.7% and 1.9% respectively as at end FY14. A s per the bank, they are liable to pay the proposed super gain tax in the future. W e are of the view that the strong company and group performance in
FY14 is fairly reflected in the market price. Hence, we change our recommendation to HOLD.

NDB Securities (Pvt) Ltd

Mrs. Prasansani Mendis

Chief Executive Officer

Sales

011 2131005

Branches

Head Office
Mr. Gihan R. Cooray

prasansini@ndbs.lk
CSE

gihan@ndbs.lk

Mr. Jayantha Samarasinghe jayantha@ndbs.lk

011 2131010

Mr. Sujeewa Athukorala

sujeewa@ndbs.lk

011 3135495

011 2131011

Mrs. Shiromi De Silva

shiromi@ndbs.lk

011 2335054

gayan@ndbs.lk

011 2907515

upul@ndbs.lk

091 2225447

Mr. Aroos Faleel

aroosfaleel@ndbs.lk011 2131012

Kiribathgoda

Mr. Taamara De Silva

taamara@ndbs.lk

011 2131018

Mr. Gayan Pathirana

Mr. Imran Reyal

imran@ndbs.lk

012 2131021

Galle

Mr. Ramesh Anthony

ramesh@ndbs.lk

011 2131023

Mr. Upul Hettiarachchi

Mr. Nimal Kumara

kumara@ndbs.lk

011 2131022

Kaluthara

Mr. Sanjaya Prabath

sanjaya@ndbs.lk

011 2131024

Mr. Ranganath Wijethunge

ranganath@ndbs.lk

034 2221589

Mr. Akram Thadani

akram@ndbs.lk

011 2131025

Mr. A A Jeewantha

jeewantha@ndbs.lk

034 2221589

Mr. Ishanka Fernando

ishanka@ndbs.lk

011 2131054

Jaffna

Mr. Harsha Sritharan

harsha@ndbs.lk

011 2131017

Mr. C Padmanathan

chandru@ndbs.lk

021 2224978

Mr. Sajed Sallay

sajed@ndbs.lk

011 2131019

Mr. S. Vibushan

vibusha.@ndbs.lk

021 5671155

Mr. Stefan De Alwis

stefan@ndbs.lk

011 2131015

Ampara

Mr. Lavan Shakya

shakya@ndbs.lk

011 2131028

Mr. Ravi De Mel

ravi@ndbs.lk

063 2224245

mail@ndbs.lk

011 2131000

Operations
Contact Us
NDB Securities (Pvt) Ltd
5th Floor, NDB Building,
40, Nawam Mawatha, Colombo 02

Disclaimer
This document is based on information obtained from sources believed to be reliable, but NDB Securities
(Pvt) Ltd., (NDBS) accepts no responsibility or makes no warranties or representations, express or
implied, as to whether the information provided in this document is accurate, complete or up-to-date.
Furthermore, no representation or warranty is made by NDBS as to the sufficiency, relevance, importance,
appropriateness, completeness or comprehensiveness of the information contained herein for any specific
purpose. Prices, opinions and estimates reflect our judgment on the date of original publication and are
subject to change at any time without notice. NDBS reserves the right to change their opinion at any point
in time as they deem necessary. There is no guarantee that the target price for the stock will be met or that
predicted business results for the company will be met. NDBS accepts no liability whatsoever for any
direct or consequential loss or damage arising from any use of these reports or their contents. References
to tax are based on our understanding of current law and Inland Revenue practices, which may change
from time to time.
Any recommendation contained in this document does not have regard to the specific investment
objectives, financial situation and the particular needs of any specific addressee. This document is for the
information of addressee only and is not to be taken as substitution for the exercise of judgment by
addressee. The information contained in any research report does not constitute an offer to sell securities
or the solicitation of an offer to buy, or recommendation for investment in, any securities within Sri Lanka
or any other jurisdiction. The information in any research report is not intended as financial advice.
Moreover, none of the research reports is intended as a prospectus within the meaning of the applicable
laws of any jurisdiction and none of the research reports is directed to any person in any country in which
the distribution of such research report is unlawful. Past results do not guarantee future performance.
NDBS cautions that any forward-looking statements in any research report implied by such words as
anticipate, believe, estimate, expect, and similar expressions as they relate to a company or its
management are not guarantees of future performance. The investments in undertakings, securities or
other financial instruments involve risks. Any discussion of the risks contained herein should not be
considered to be a disclosure of all risks or complete discussion of the risks which are mentioned.
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transactions in securities mentioned herein and may also perform or seek to perform broking, investment
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