Foreign Investors to Make Major Moves on Colombo Stock Exchange after Budget

20th October 2010, www.news360.lk, By Prasanna C Rodrigo

Foreign investors are showing lot of interest to enter the Sri Lankan stock market but yet to make their moves says Sanjitha Rajasekeran the Research Head of Asia Securities Stock Brokers.

She said “There is lot of inquiries from Fund Managers from Asia, EU and USA”, But added those inquiries haven’t yet been converted to action.

According to her, foreign Fund Managers are coming to Sri Lanka and visiting listed firms and even inquiring through conference calls.

However Rajasekeran said despite the huge interest “they are still adopting a wait and see policy”.

She noted that after the end of the conflict they were expecting a “dramatic entry” of foreign investors to the Colombo Stock Exchange.

However the Research Head of Asia Securities said, as of now the foreign funds which enter the CSE are only getting engaged in the form of “stock picking”.

This means they only buy selective stocks especially from conglomerates, Hotel and Banking sector counters.

When asked when will those interested foreign funds will make major moves, she told us “probably after the budget” if they see the Budget is growth friendly.

Meanwhile during this year so far foreign investors in the CSE are on a selling spree thus recording a year to date net foreign outflow of Rs. 20.58 billion.

Rajasekeran said this is “profit taking” by foreigners who has bought shares when the prices were at rock bottom prices.

However she said net foreign selling has not impacted the market as there is heavy participation by local institutes thus helping the CSE to stabilize.

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