ECONOMYNEXT – Sri Lanka’s listed firms in 2021 through Initial Public Offerings (IPO) have overall gained 46 percent as of January 21, the stock exchange data showed with Logistic firm Chrissworld outperforming others.
The island nation’s 6 trillion Sri Lankan rupee (30 billion US dollar) worth Colombo Stock Exchange saw a record number of IPOs last year mainly due to a 50 percent tax concession incentive for listing.
Out of the 14 companies listed through IPO, 12 firms traded more than their IPO price as of Friday (21) with Logistic firm Chrissworld jumping 187 percent to close at 21.50 rupees on Friday, compared to the IPO price of 7.50 rupees.
Shares in Ex-Pack Corrugated Cartons with a 168 percent gain, Multinational software product company hSenid Business Solution with a 151 percent rise, and LOLC General Insurance with an increase of 132 percent are now trading at more than double of their IPO prices.
Overall, the market saw 1.16 billion shares listed through the IPO last year with a value of 13.2 billion rupees when they started trading in the CSE. The value of these shares was at 19.4 billion rupees as at the end of trading on Friday (21), resulting in an overall gain of 46 percent, CSE official data showed.
Thousands of local Sri Lankan investors, mainly retailers, hardly had any options for the investments amid negative returns after excess money printing to keep the interest rates artificially low which also resulted in a record double digit inflation.
The overall market posted 80 percent return last year. Some of it was accounted for by firms that had only a few free floated shares which prompted the exchange to change the way the overall index is calculated.