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CSE approves Softlogic Finance Rs 1.9 billion rights issue

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Softlogic Finance PLC received Colombo Stock Exchange (CSE) approval for its rights issue of Rs 1.9 billion and the extraordinary General Meeting of the company is fixed for November 9, 2020, with the funds expected to be received by the company by end November. The rights issue is fully underwritten by its immediate parent Softlogic Capital PLC and the entire equity infusion is hence guaranteed.

The Softlogic Group has also announced purchasing the shares of Abans Finance PLC consequent to which Abans Finance PLC will be amalgamated with Softlogic Finance PLC with the latter being the surviving entity. The transaction is currently pending approval of the regulator, the Central Bank of Sri Lanka. The combined entity, post-merger, will create a stronger and bigger company that is estimated to have total assets of Rs 32 billion, customer deposits of Rs 22 billion and customer advances of Rs 26 billion, whilst complying with all of the regulatory requirements of the Central Bank of Sri Lanka including the capital adequacy of the company. The capital position of the amalgamated entity is expected to be Rs 4.9 billion by 31st March 2021.

Softlogic Finance is therefore upbeat on its future prospects that will deliver a robust business strategy enhanced by digitalization and delivered by the new management team of the company that is in place since May of this year. Unparalleled customer convenience and ease of doing business are expected to bring about synergies within the Softlogic Group’s large customer base and will follow the tremendous success delivered by its sister company Softlogic Life Insurance PLC that is the country’s fastest growing life insurer having recorded a five-year growth of 30% versus industry growth of 12%.

The Softlogic Group has long viewed Financial Services as an industry with substantial opportunities for growth. This proposed merger compliments Softlogic Finance in its ambition to increase its footprint in the NBFI sector, particularly in the dynamic leasing category, which represents an area of strategic focus for the company.

The Company is currently re-evaluating its product mix and service offering, and work is in progress to streamline its systems and processes to suit a digitized environment, in order to prepare the company to confidently face the constantly changing external landscape and sustainably deliver a distinctive and easily accessible value proposition to its customers.

The Softlogic Group is regarded as one of Sri Lanka’s most dynamic and progressive conglomerates, with industry leadership in key business verticals; with its presence visible across the Healthcare, Retail, Financial Services, ICT, Automobiles and Leisure sectors. Softlogic Finance is a registered finance company under Finance Business Act No. 42 of 2011 as well as a Specialised Leasing Company licensed by the Central Bank of Sri Lanka under Finance Leasing Act No. 56 of 2000.



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Business

Cabinet approves rationalization of VAT exemptions and abolition of SVAT System

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The Cabinet of Ministers granted concurrence to the resolution forwarded by the Minister of Finance, Economic Stabilization and National Policies to remove most of the releases from Value Added Tax (VAT), further retaining releases that ease the pressure on low – income families to secure the fundamental sectors of the economy as well as the releases for sectors such as education, health and agriculture, as well as to revise the provisions applicable for the Value Added Tax (VAT) act so that the Simplified Value Added Tax (SVAT) methodology can be canceled with effect from 01.01.2024 by introducing a more formal methodology for repaying the Value Added Tax (VAT) and to instruct the Legal Draftsman to prepare a draft bill for the purpose.

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Venora Lanka Power Panels to set up assembly plant in Australia

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Sagara Gunawardene

By Hiran H.Senewiratne

Sri Lanka- based, export- oriented manufacturer, Venora Lanka Power Panels (Pvt) Ltd, with a state of the art electric panel factory at the Export Processing Zone, Biyagama, will set up an assembly plant in Australia.

“Once we set up the electric panel assembly plant in Australia, we will export all our panels from Sri Lanka and that plant will do 30 percent value addition to the product to supply that market, the company’s chairman/ Managing Director, engineer Sagara Gunawardena told The Island Financial Review.

Gunawardena said that the company is a value- addition assembly plant and he would be investing AUS $ 2 million for the project to be set up in Melbourne and hire 100 engineers and other professionals. He explained that the venture has enormous potential.

Venora Lanka provides power panels to mega projects in Sri Lanka and exports to Bangladesh, Maldives, Kenya, Ethiopia, Seychelles and Myanmar. Panel assembling is strictly in compliance with IEC 61439 standards, it was explained.

Gunawardena added: ‘I firmly believe that, being a truly customer focused organization, every employee and every process in the organization has to be aligned behind delighting customers. Therefore, at a time when the country is facing a major dollar crisis, my company would be aiming at bringing dollars into the country, while providing employment for local professionals, especially engineers.

‘At Venora Lanka we do not try to change customers’ mindsets. Instead, we take time to understand what they really want and focus our brand on delivering that. Venora is values- driven first and cost- driven second – creating a unique brand proposition.

‘Since the US dollar rate has come down, it is our concern that importers and suppliers do not change their prices, which is really affecting the manufacturing sector.

Company sources added: ‘The company has several wings of operation, such as local and overseas projects, switch board assembling, telecommunication infrastructure installations, earthing, lighting and surge protection, incorporating world renowned brands.

‘Venora Lanka Power Panels is the first Sri Lankan company to receive the licence, in accordance with the UK Trade Mark Act 1994, to use the trade mark “Best Enterprise”. It won a global award at the event, ‘Golden Awards for Quality and Business Prestige’, held in Geneva, Switzerland, in 2015.

‘Within a short span of time, with the perfect blend of progressive thinking and expertise, Venora Group has expanded to consist of, Venora International Projects, Venora Telecom, Venora Industrial Solutions and Venora Lanka Power Panels (BOI approved). Further, Venora has established its overseas presence through Venora Engineering Kenya and Venora Engineering Myanmar.’

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Share market moves into positive territory; indices up

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By Hiran H. Senewiratne

CSE trading got off to a positive note yesterday but during the last session of the day the momentum slowed. However, the market is now moving towards positive territory following the Central Bank announcement of a downward trend in interest rates, market analysts said.

Amid those developments the market witnesses improvements in both indices and in the turnover.

The All- Share Price Index up by 12.8 points and S and P SL 20 rose by 6.97 points. Turnover stood at Rs 710 million with one crossing. The crossing was reported in JKH which crossed 430,000 shares to the tune of Rs 60.2 million; its shares traded at Rs 140.

In the retail market top seven companies that mainly contributed to the turnover were; JKH Rs 212 million (1.5 million shares traded), Access Engineering Rs 44.7 million ( three million shares traded), Lanka IOC Rs 34.5 million (264,000 shares traded), Browns Investments Rs 28.6 million (5.3 million shares traded), LOLC Finance Rs 23.8 million (4.7 million shares traded), Capital Alliance Rs 22.9 million (615,000 shares traded) and First Capital Holdings Rs 19.2 million (574,000 shares traded). During the day the 31.4 million shares volumes changed hands in 9000 transactions.

Yesterday, the Central Bank’s US dollar buying rate was Rs 285.16 and the selling rate Rs 298.85.

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