Written by Ramesh Irugalbandara
21 May, 2015 | 9:17 pm
The price of a warrant of the Reef-comber company mentioned by the Prime Minister in Parliament recently, has plunged to 10 cents as of today. Speaking in Parliament recently, the Prime Minister called for probes into activity surrounding several listed companies, including Reef-comber.
The All Share Price Index (ASPI) at the Colombo Stock Market, stood at 1,500 points, just before the war ended in 2009. Market capitalization during this period stood at approximately 1 trillion rupees, with an average daily turnover of 460 million rupees.
Within a short span of two years, in February 2011, the ASPI had risen astronomically to 7,800 points, with market capitalization at 2.3 trillion rupees and an average daily turnover of 2.3 billion rupees.
The bubble peaked in February 2011 and deflated subsequently, reaching a low point in April 2012.
The ASPI took a nosedive almost as fast as it had risen, falling to 4,700 points, with market capitalization reducing to 1.8 trillion.
Speaking in Parliament recently, the Prime Minister, called for probes into market manipulation, specifically citing the names of Dilith Jayaweera, Scott Newman and Kosala Heengama for their involvement in several ventures.
Given that the Prime Minister, has called for probes, there are several questions which must now be answered by the Securities and Exchange Commission
Who were the dons of the stock market mafia?
Who manipulated the CSE?
Who took the retail investors for a ride?
Whose patronage did they have, political or otherwise?
The Reef-comber company which the Prime Minister referred to, currently operates with a change of name to Citrus Leisure. The price of Citrus Leisure shares trading under the code REEF.N0000, stood constant from October 1st to November 2nd 2010 around the 20 rupee mark, however between the 2nd and 9th of November the share price skyrocketed by 255 percent to 71 rupees and 20 cents per share.
The price of a Citrus Leisure Warrant which trades under the code REEF.W0019, stood at 2 rupees on the 6th of June 2012 and by the 20th of June 2012, had increased to 8 rupees, an increase of 300 percent. These warrants now stand at 10 cents.
News 1st is in possession of this Bought/Sold Contract Note, pertaining to a transaction carried out on the 19th of May, which bears testament to this.
Shouldn’t a proper investigation be carried out into the drastic reduction of the share prices, within a short span of three years.
Citrus Leisure : The story behind the numbers
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