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CSE plunges by 2.5 per cent in the wake of budget proposals

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By Hiran H.Senewiratne

The CSE fell 2.5 percent at the beginning of trading yesterday subsequent to Finance Minister Basil Rajapaksa’s 2022 budget presentation due to the 25 percent retrospective tax surcharge on firms that earned over Rs. 2 billion in 2020/21 and the 3 percent increase in Value Added Tax (VAT) for banks, insurance, and financing firms.

VAT was increased to 18 percent from the current 15 percent on banks and financial service providers under supply of financial services by specified institutions with effect from Jan.1, 2022, targeting Rs 14 billion from the proposal.

CSE fall was led by banks and financial sector institutions. This was expected and banks were worried about the tax because it would adversely impact the banking and financial sector institutions, market analysts said.

However, during the latter part of the day the CSE showed some recovery. It was the same in 2015 when the last government came up with a similar retrospective tax that was introduced, stock market analysts said.

The All- Share Price Index plunged to 10,372 immediately after it opened and dropped to over 2 percent but later recovered slightly due to the LOLC group witnessing some buying pressure from two main companies, LOLC Holdings and LOLC Finance, that drove the market, stock market analysts said.

Accordingly, both indices showed mixed reactions. The All -Share Price Index went up by 86.28 points and S and P SL20 went down by 17.57 points. Turnover stood at Rs 6.9 billion with two crossings. Those crossings were reported in Chevron Lubricants, where 340,000 shares crossed for Rs 35.7 million and its shares traded at Rs 105 and LOLC Holdings 29000 shares crossed for Rs 20.1 million, its shares traded at Rs 696.

In the retail market top five companies that mainly contributed to the turnover were, LOLC Finance Rs 2.1 billion (74.6 million shares traded), Expolanka Holdings Rs 428 million (2.1 million shares traded), Browns Investments Rs 423 million (36.6 million shares traded), RIL Properties Rs 364 million (23.8 million shares traded) and LOLC Holdings Rs 339 million (480,000 shares traded). During the day two LOLC Group companies share prices appreciated. Those were LOLC Holdings, whose share price appreciated by Rs 29.25 or four percent. Its share price shot up to Rs 738 from Rs 692.75, contributing 31 points to the All- Share Price Index. LOLC Finance share price appreciated by Rs 12.90 or 15 percent. Its share price shot up to Rs 95.50 from Rs 82.60. Other than the LOLC Group of companies, significant price appreciation was witnessed in Watawala Plantations, whose share price appreciated by 15 percent or Rs 12.90. Its share price appreciated to Rs 95.250 from Rs 82.60.During the day 316 million share volumes changed hands in 52000 share transactions.

MSCI Inc., the leading provider of research-based indexes and analytics, has included Expolanka Holdings PLC in its Frontier Markets Equity Index.

Expolanka is one of the three largest additions to the MSCI Frontier Markets Index measured by full company market capitalization. The other two are Phat Dat Real Estate (Vietnam) and Islandsbanki (Iceland).

MSCI also announced four deletions from the Index, including Commercial Bank of Ceylon PLC. The MSCI Sri Lanka Index has two constituents. JKH is the other, apart from Expolanka. The MSCI Sri Lanka had offered 7.55 per cent return as opposed to 8.57 percent by MSCI Frontier Markets index since 31 May 2002. MSCI Sri Lanka’s PE ratio is 10.78 times as against 16.59 times of MSCI Frontier Index.

Yesterday, the US dollar was quoted at Rs 202.05 as per the Central Bank controlled price. This was introduced to control price increases of essential items in the local market.



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Needs of populace hit by Cyclone Ditwah seen as waiting to be addressed

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Lionel Bopage: ‘Recovery painfully slow.’

By Hiran H. Senewiratne

The government is yet to address fully the needs of the Cyclone Ditwah affected populace though one year has elapsed. The devastation cost the country more than US $ 4.1 billion, an Australia-based Chartered Engineer of Sri Lankan origin said.

‘Cyclone Ditwah affected more than 2.2 million people in 25 districts, which is considered to be one tenth of the population. However, only 39 percent of the allocated funds have been spent to date, the speaker, a one-time General Secretary of the JVP, now living in Australia Lionel Bopage said.

He made these comments at a Rotary Club Colombo South monthly meeting held at the Kingsbury Hotel, Colombo recently.

Bopage quoted from a Loughborough University research report published in February to the effect that Sri Lanka has under invested in prevention but over invested in recovery.

Bopage added: ‘The largest single economic category affected were not buildings but the agriculture sector which provides livelihoods for the majority of affected persons. Therefore agricultural livelihoods have been hit most.

‘More than 58,000 hectares of paddy lands were flooded in the Eastern districts alone, while 46 reservoirs reached critical spill level or failed outright following the disaster.

‘A rapid education sector assessment found that 1,682 schools were affected and more than 555,000 children were unable to attend schools. Further, 622 water supply schemes had been left non-functional and apart from that 11300 homes were damaged or destroyed. But reconstruction is happening at a very slow pace.

‘Tens of thousands of households in the hill country and in the East are still living in damaged properties and on unstable slopes drawing water from schemes that have not been restored.

‘ A Post Disaster Needs Assessment put the cost of resilience at US$ 3.4 billion but restoration work is happening at a slow pace even with foreign donor assistance.’

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WB forecast buoys bourse but weak investor participation slows momentum

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By Hiran H. Senewiratne

The CSE yesterday kicked off on a positive note due to a World Bank forecast that Sri Lanka could achieve 4.4 percent economic growth this year but later lost momentum due to weak investor participation.

Amid those developments both indices moved upwards. The All Share Price Index went up by 132 points while S and P SL20 rose by 21.02 points.

Turnover stood at Rs 1.97 billion with three crossings. Those crossings were; Lanka IOC 2.7 million shares crossed to the tune of Rs 470 million; its shares traded at Rs 127, CCS 2.7 million shares crossed to the tune of Rs 315 million; its shares sold at Rs 118 and JKH five million shares crossed for Rs 91.5 million; its shares traded at Rs 18.30.

In the retail market companies that mainly contributed to the turnover were; Commercial Credit and Finance Rs 126 million (1.3 million shares traded), Lanka IOC Rs 98 million (775,000 shares traded), Asiri Surgical Hospitals Rs 77 million (7.6 million shares traded), Commercial Bank Rs 51.3 million (307,000 shares traded), Sampath Bank Rs 46 million (325,000 shares traded), HNB Rs 37 million (98000 shares traded) and Tokyo Cement Rs 31 million (393,000 shares traded). During the day 50 million share volumes changed hands in 14547 transactions.

It is said that the petroleum sector performed well, especially Lanka IOC, while in the banking sector counters, especially Commercial Bank and Sampath Bank performed well. In the manufacturing sector, JKH impressed.

TAL Lanka Hotels announced that it has scheduled an Extraordinary General Meeting on October 29 to obtain shareholder approval for a proposed Rs 1.87 billion rights issue. The proceeds will be utilized for the repayment of bank borrowings, part refurbishment of the Taj Samudra Hotel in Colombo, settlement of vendor liabilities, and general corporate requirements.

Yesterday the rupee was quoted at Rs 330.95/331.05 to the US dollar in the spot market, weaker from Rs 330.85/95 the previous day, while bond yields were quoted broadly steady, dealers said.

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Huawei continues to showcase practical AI applications at Sri Lanka AI Week 2026

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Sri Lanka AI Week 2026 continued into its second day bringing together government, industry, academia and technology partners to explore practical applications of artificial intelligence. As the AI Technology Partner for the second consecutive year, Huawei showcased 18 use cases spanning government, education, finance, industry, green energy and everyday life, demonstrating how AI can be applied to real-world needs.

Prime Minister Dr. Harini Amarasuriya visited the Huawei exhibition together with officials from the Ministry of Education, Higher Education and Vocational Education, experiencing the Smart Classroom, AI in Education and MindGraph by Beijing Normal University demonstrations. The Smart Classroom demostration highlighted how connected technologies can bring teachers and students in different locations into a shared learning environment, while the AI in Education showcase demonstrated how AI can support teachers, enhance learning and enable more personalised education. The Prime Minister praised the efforts of the Ministry of Education, Higher Education and Vocational Education, Huawei and their partners to demonstrate practical applications of AI in education, noting the role of technology in supporting teachers, expanding learning opportunities, and advancing a more inclusive, equitable and future-ready education system.

Later in the day, Deputy Minister of Digital Economy Eng. Eranga Weeraratne, Deputy Minister of Industry and Entrepreneurship Development Chathuranga Abeysinghe, Secretary to the Ministry of Digital Economy Waruna Sri Dhanapala, and Chinese Ambassador Wei Huaxiang visited the Huawei exhibition and explored the AI Hands-On Classroom AI Empowering Industry, AI in Education and Smart Classroom demonstrations. Deputy Minister Weeraratne praised Huawei’s practical approach to showcasing AI applications, noting their relevance to Sri Lanka’s digital transformation across education, industry and skills development. The engagement also extended across the wider AI ecosystem, with industry professionals, technology partners, academics and other visitors engaging with the demonstrations and expressing appreciation for Huawei’s practical approach to applying AI across different areas of society and the economy.

Daniel Wu, CEO of Huawei Sri Lanka, said that Huawei will continue bringing global experience, technology and ecosystem resources to Sri Lanka, while working side by side with local partners to build local capabilities, develop local talent and create real value for the country. “I believe that by working together, we can make AI not only more intelligent, but also more local, more inclusive, and more meaningful for everyone,” he said.

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