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Sri Lanka stock exchange should aim at 500 firms, US$60bn market cap: Minister Cabraal

ECONOMYNEXT – Sri Lanka’s stock market should aim at raising listed companies to 500 firms from the current 200 odd and more than quadruple market capitalization to 60 million US dollars over the next five years, State Minister for money and capital markets Nivard Cabraal said.

Over the past three decades Sri Lanka’s stock market has had over 200 listed companies which had not grown substantially.

“In the next five years we would like to see some 500 something,” Minister Cabraal said. “I think you can do it.”
He was speaking at an event attended by Prime Minister Mahinda Rajapaksa marking the digitalization of the stock market where physical paperwork involved in opening trading accounts, settlements and dividend payments would be eliminated.

Cabraal said in 2014 when the Rajapaksa administration left office the stock market capitalization was about 25 billion US dollars.

But over the past several years had fallen to 12.5 billion US dollars.

“Sets your sights on 60 billion US dollars in the next five years,” Minister Cabraal said. “You need to have buyers who are increasing, the sellers who will be providing the supply of shares,” he said.

He said proposed Small and Medium Enterprise Board and Start-Up board would provide a basis for expansion.

He said the President and the Prime Minister had indicated their support and he would also provide support.

Sri Lanka’s stocks have gained after Coronavirus lockdowns ended and the spread of disease was contained though tracing and quarantine.

The Colombo Stock Exchange is also launching a mobile app and the Securities and Exchange Commission would launch a Youtube.com channel.

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The SEC had formed a joint committee with the Colombo Stock Exchange to speed up digitalization.

Colombo Stock Exchange Chairman Dumith Fernando said to enable every citizen to general wealth through capital markets there had to easy access to learn about the market.

If transaction costs are down it makes it cheaper to access the market. Digitalization achieved these goals he said. (Colombo/Sept17/2020)