BOJ buys $5m at J$133.65

The rate Bank of Jamaica paid on Wednesday, July 25 to purchase US$5 million in the B-FXITT Standard Intervention Tool – buy operation average J$133.65.
Eligible dealers placed bids to buy only $5.5 million with the highest priced offer at 137.24 to sell $200,000 and the lowest at $126 for $200,000. BOJ purchased funds as high as $137.10 amounting 40 percent of the amount offered while the amount of $350,000 that was offered at $137 was fully taken up. Eligible Offers were received from 19 sellers while 18 had funds bought.
The central bank will buy US$5 on Wednesday July 31 and August 8 and will sell $10 million to the market on August 19.

All Jamaica nears record 341,000 points

NCB Financial climbed to $99.80 and Jamaica Broilers at a record $30 after just after 11 on Friday morning and pushed the main market to a new record high, surpassing the record reached last week Friday.
At minutes after 11, the All Jamaican Composite Index jumped 2,522.73 points to a record 340,798.92 surpassing the record of 340,315.50 reached last Friday with the JSE Index rising 2,298.49 points to 310,506.28 versus a record 310,065.85 last week. . The Junior Market added 23.66 points to trade at 3,064.01. the main market rose further to 340,893.72 points on the All Jamaican Composite Index and the JSE Index climbed to 310,624.04 at 11:15 am.
Carreras traded 612.643 shares at $9.20 and NCB Financial traded 274,733 units and now trades at $95. In the Junior Market C2W Music traded at a 52 weeks’ high of $1.70.

$9.20 offered for 75% of Barita shares

Barita last traded on the JSE on Wednesday at $9.

The long awaited formal offer to acquire majority shares in Barita Investments has been released.
Cornerstone Investments Holdings is offering $9.20 per share for 334.4 million Barita shares to acquire no more and no less than 75 percent of the company. The intention is for the company to remain listed on the Jamaica Stock Exchange
The offer opens on July 26 will cost $3 billion. The company signed a lock up agreement with Rita Humphries-Lewin and Karl Lewin who have 77.5 percent of the shares to sell amounts to allow for the 75 percent acquisition as such the offer is all but done.
The company has 445.877 million shares issued contributing to shareholders’ equity of $2.86 billion or $6.40 per share.
For the March quarter comprehensive income was $165 million and $492 million for the half year or just over $1 per share and puts the purchase price at about 5 times earnings. But the acquisition is even more attractive to the buyers. Both Humphries will cease being executives that will result in cost savings. The new link up could see a more aggressive stance taken in increasing business and profit within a relatively short time frame from existing offerings as well as new ones. The Unit Trust business is a potential storehouse of huge income down the road while more can be eked out of the portfolio of investments. Investors who hold on to their shares will benefit from a promised 80 percent pay out of profit going forward.

Indies Pharma IPO 2.5 times over

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Indies Pharma went to the capital market last week Thursday to raise $248.4 million from 174 million shares for its own use while existing shareholders offered 92.5 million units to raise nearly $139 million.
Information reaching IC indicates that the offer that closed on Friday attracted some 2,800 applications, covering over than $1 billion and was about 2.5 times oversubscribed. GK Capital the lead broker pulled in about 50 percent of the inflows, our source indicates. The number of applicants sits just below the amount attracted by Victoria Mutual Investments which was in excess of 3,000.
The shares were mostly priced at $1.50 each with lower prices for shares reserved for selected groups. Only 60 million shares were set aside for the general public. The proceed for the shares sold by the company is expected to be used to pay off loans to its parent company and banks, working capital and funds the cost of the issue. The total issued shares currently amount to 1,158,553,500 units and the issue of 173,983,149 shares, raises the total shares to 1,332,536,649 units.
Indies Pharma is a pharmaceutical distribution company out of Montego Bay, which sold its first pharmaceutical 2005, and today distributes over 150 prescription and over the counter pharmaceutical formulations for Bioprist Holdings under the ‘Bioprist’ brand and operates the Trident Pharmacy located nearby in Sam Sharpe Square, Montego Bay.

The chairman and founder of Indies Pharma

The Company currently services customers across the island, including over 400 pharmacies, private and public hospitals and government agencies including the National Health Fund as well as medical practitioners and directly to individuals.
Investors demand has pushed prices in the post IPO period to peak around 15 times current year’s earnings. On this basis, it seems likely that Indies Pharma will peak around $2.5 based on IC’s projected earnings in 2018, of 17 cents per share, it could go higher with the high level of applicants for the shares.
For the half year to April, revenues rose 10 percent to $301 million over the similar period in 2017 but profit is only up 6 percent to $73 million from $69 million before tax. IC’s forecast is for a 16 percent increase in pretax profit to $200 million for the current year. The company could pick up additional sales and profit as a result of the publicity that emanates from the IPO and subsequent listing.

Treasury bill rates plunged

Treasury bill rates plunged at the latest auction to raise $1.4 billion for Government of Jamaica held today.
At the latest Treasury bill auction the rate on the 91 days bill declined by just over 58 basis points to just 1.9596 from to 2.544 percent at the June auction, while the 182 days instrument average rate dipped 65 basis points to 2.07 percent from 2.656 percent from the June Auction. The two offerings of $700 million each attracted a total of just over $6.2 billion up from $5.3 billion in June, an indication of continued high liquidity in the market. The latest fall in rate follows a recent 50 basis point drop in Bank of Jamaica’s (BOJ) overnight rate to 2 percent and is almost certain to trigger another cut in the BOJ overnight rate.
The continued fall in rates comes against the back ground of negative inflation of 0.3 percent for the first half of the year. The sharp fall in rates is bound to be reflected in increased demand for stocks and real estate going forward as investors seek higher returns on their investments. Technical indicators point to a big break out for local stocks starting in August and the recent fall in rates will be a critical fuel for it.

New high for All Jamaica

NCB Financial climbed to $99 seconds after trading opened on Friday while trading just 460 shares and helped to push the main market into record territory.
The All Jamaican Composite Index climbed 1,082.40 points to a record 340,315.50 with the JSE Index rising 986.19 points to a record 310,065.85. in moderate early market activity. The Junior Market added just 6.55 points to trade at 3,061.45 as investors pushed IC TOP 10 listed, Caribbean Cream share up to $6.10, in trading 39,035 shares at the opening, in response to a 59 percent increase in profit for the first quarter. Trading in the stock is suspended, with it having risen 24 percent from the close on Thursday.
If the market ends above Thursday closing level, it would result in five days of new record close for the market.

All Jamaica Index at record 340,000

The Jamaica Stock Exchange All Jamaica Composite Index has now broken into the 340,000 points level for the first time in the market history.
After 45 minutes of trading, the All jamaica index rose 2,110.74 points to trade at 340,190.28 and the JSE main index rose by 1,923.12 points to end at a record 309,951.76. The move is in keeping with technical signals that was evident for some time and pointing to the main market poised for a big rally, with the first major resistance being around 365,000 points.
If the market holds up at these levels at the close, it would be it would be the third record for the week so far.
The continued record run in the main market is the best confirmation that business persons and individuals confidence are at record high levels currently as the market is the most current read on confidence levels in the country.

Stock split for Blue Power?

Blue Power stock split to be considered by the directors.

A stock split could be coming for Junior Market listed Blue Power Group that is currently selling at $30. The directors of the company advised the Jamaica Stock Exchange on Wednesday.
The company also advised that a meeting of their Board will be held on July 2, will consider the declaration of a dividend and Whether the Board should recommend a stock split to the shareholders. IC gathers from unconfirmed sources that the although the wording suggest that there could be a decision not to split the stock there is a strong possibility that the decision end up being being a 10 to 1 split.
Blue Power reported full year earnings to April with a fall from $122 million to $102 million as other income dropped from $8 million to $3.4 million and net finance income nosedived from $21 million to just $66,000, after revenues grew 8 percent from $1.4 billion to $1.5 billion and gross profit fell from $327 million to $323 million. The company reported strong growth in export sales of soap but say they are gearing for increased completion within the region including new soap plant in Jamaica. The increase in export sales over the previous year was 34% from $70 million to $94 million Dhru Tanna stated in his report accompanying the audited financial statements.
Earnings per share was $1.81 for the just concluded 2018 fiscal year.

No Inflation in Jamaica

With 5 months having elapse for 2018 data put out by the Statistical Institute of Jamaica (STATIN) show Jamaica still having deflation of 0.7 percent, the same as in April.
According to STATIN, the All Jamaica Consumer Price Index recorded a negligible movement for May 2018, The main contributor to this movement was the 0.2 percent fall in the index for the heaviest weighted division ‘Food and Non-Alcoholic Beverages, due mainly to lower prices for agricultural produce, especially vegetables such as cabbage, carrot, sweet pepper, tomato and lettuce.
Tempering the declining items was a 0.2 per cent increase in ‘Housing, Water, Electricity, Gas and Other Fuels’, primarily resulting from higher electricity rates, offset by a reduction in water and sewage rates. May out turn brings inflation in the past twelve months to May to was 3.1 percent.

More fall in Treasury bill rates

Government of Jamaica Treasury bill sample

Treasury bill rates declined again at the latest auction for $1.4 billion offered by Government of Jamaica on Wednesday.
At the latest Treasury bill auction, the average rate on the 91 days bill declined to 2.544 percent from 2.71 percent at the May auction, while the 182 days instrument average rate dipped to an average of 2.656 percent from 2.83 percent for May. The two offerings of $700 million each, attracted a total of just over $5.3 billion, an indication of continued high liquidity in the market.
The continued fall in rates comes against the back ground of negative inflation of 0.6 percent up to April, including deflation of 0.40 percent in April.