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Apr 1, 2011

Union Bank IPO gains below expectations at Colombo Stock Exchange

Colombo Stock Indices were volatile throughout the trading hours on Tuesday the 29 March 2011 and closed in red with selling pressure creeping in. Union Bank of Colombo (UBC) which started to trade on trading floor followed by its Initial Public offering attracted investors although a lower price appreciation was witnessed than anticipated, especially considering its record breaking oversubscription.

The All Share Price Index (ASPI) closed at 7,207.86 points, down 0.03% by 2.23 points and the Milanka Price Index fell 0.31% through 21.01 points closing at 6,817.40 points during the day. Total turnover recorded to be Rs.3.23 billion (rose 100.96%) topped by 21 crossings in the market with eight crossings of Commercial Bank (COMB) and seven of Union Bank of Colombo (UBC). A total volume of 56.72 million shares changed hands (rose 14.57%) whilst foreign purchases rose 105.97% to Rs.303.9 million and foreign sales also topped 512.67% to Rs.1.386 billion. Prcie to forward earnings Ratio (PER) declined by 0.39% to 25.7 times.

Bank, Finance & Insurance sector was the main contributor to the market turnover (due to Commercial Bank & Union Bank) with the sector index increasing 0.54%. Commercial bank (COMB) was the main contributor to the market turnover with three crossings (4,410,500 shares at Rs.270). The share price decreased by Rs.0.90 (0.33%) and closed at Rs.268.10. Foreign holding of the company decreased by 4,428,200 shares.

Union Bank (UBC) commenced trading in the secondary market today with three crossings (1,500,000 shares at Rs.42 and 765,000 shares at Rs.31. The share price increased by Rs.13.60 (54.4%) and closed at Rs.38.60. Diversified sector also contributed to the market turnover due to Hayleys, with the sector index decreasing 0.17%.Union Bank of Colombo (UBC) contributed to market turnover with Rs.715.7 million while several other crossings were also done including Asian Alliance Insurance (AAIC) 1.2 million shares at Rs.1 90 per share and Hayleys 546,200 shares at Rs.380.


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