POWER CHANGE.

Merchant bank of srilankan (MBSL) chairman Janaka Rathnayake and MBSL has acquired the majority holding of ceylinco Investment Company limited (CICL) a ceylinco group company. The statement from TFC said, MBSL and Mr.Rathnayake equally owns 46.35% in the CICL under the new share holdings with the balance 7.3% held by other unnamed parties.  The Colombo stock exchange was informed on Friday. CICL has a 37.13% stake in the TFC which is managed by MBSL. It seems to be that ceylinco group is loosing the controlling stake in TFC. Within 3 years TFC new management can make the TFC company turn around and protect depositors over 27 billion wealth. Currently TFC is trading at 28/= and book value is 97.44/=

CSF (ceylinco securities and finance) which is also another ceylinco company, they have already changed their company name which is now “Nation lanka finance” and got the central bank approval for finance business. Very soon this company can also be separated from the ceylinco group. If investors keep confidence on nation lanka finance deposits may flow into this company. In that situation there is a possibility for this company to purchase the listed and unlisted wealthy companies which belong to the ceylinco group.

My personal opinion is, investors…. Its better to buy and hold CSF and TFC shares for a 12 month portfolio in the current level which is around 28/= and also buy MBSL shares at current level. 28 /=. I am sure you can get more than 100% return.

Happening and power changing can happen anytime in this group. Some stock brokering firms’ advice their clients not to touch ceylinco group shares and also they don’t like to give margin facilities to those shares. If you area smart investor, don’t hate or don’t love shares. You have to analyze the situation. Buy numbers in uncertainty and sell numbers in good news time, because people will chase behind the numbers if things are good.