Business

Hatton Plantations looks to gain on its robust capital structure

Published

1 year ago

2025/01/17

Seated from left: Menaka Athukorala,CEO & MD HPL PLC, Gary Seaton ,Chairman G&G Group of Companies ,Singapore, Gowri Shankar, CEO G&G Group of Companies, Singapore. Standing from left: Waruna Fernando, Deputy CEO, HPL PLC, Nisal Rukshan , Assistant Manager Plantations and Leisure, HPL PLC.

Looking for opportunities to invest in tourism and solar power verticals

Says ‘would be happy to talk to right partners’

By Sanath Nanayakkare

Getting a more realistic control over historical truth and the current significance of a company will probably be the prime concern of a potential investor looking for a strategic tie-up with a particular company, before he or she decides to invest in it.

In that context, Hatton Plantations may not have a ‘story’ to tell, but rather a ‘credible report’ to present because many investors might be cynical about listening to stories.

Hatton Plantations PLC is a subsidiary of G&G Group of Companies, a Singapore-based conglomerate whose chairman is Gary Seaton from Australia who first visited Sri Lanka in the 1970s as a backpacker tourist. Then he and his family started looking at business opportunities in Sri Lanka in the 1980s and bought the first tea company in 1996 after the plantations privatization programme came into effect in Sri Lanka. That was the well-known Pussellawa Plantations spanning across 10,000 hectares.

Then they sold it in 2017 and bought Hatton Plantations (HPL PLC) in 2019 which has 7,500 hectares on 13 estates.

Today HPL PLC has 12 tea processing factories with a combined green leaf capacity of 155,500 kg per day. It uses Orthodox, CTC, Leafy, and Green Tea manufacturing methods supported by versatile production facilities. It engages in the production of high and medium-grown teas in the key regions of Watawala, Hatton, and Lindula.

Hatton Plantations PLC, was the highest producer amongst all the Regional Plantation Companies (RPCs), having sold a quantity of 6,484,037.50 kgs with an average of Rs.1,134.11 for the year 2024, preceded by equal performances in the three previous years. And HP PLC is one company that has been replanting for the past four years continuously – a key factor that has contributed to its continuous growth.

Speaking to the media at the Company’s office in Peliyagoda recently, Gary Seaton said. “We have a vision to further expand into plantation, and we also look at two other business verticals: renewable energy and tourism. We very much believe in transitioning from fossil fuels to renewables. Sri Lanka is one of those few remaining countries that hasn’t industrialized everything and that’s very much aligned with the vision of Hatton Plantations PLC. We understand the challenges Sri Lanka faced in the last 40 years. But despite those challenges, we are with Sri Lankans. Many Sri Lankans are leaving Sri Lanka to go abroad, but we are coming from abroad to operate from Sri Lanka. We are doing it the other way around,” he said on a lighter note.

Menaka Athukorala, CEO & MD Hatton Plantations PLC said,” As part of the diversification, we are going into coffee in a major way. We initiated this project three years ago and we have already planted coffee on 100 hectares, and we are already harvesting coffee. A total of 500 hectares of coffee will be planted in the next 3 to 4 years. Our total investment in coffee would be Rs. 1 billion and we have already invested Rs. 200 million. With this, our per hectare income grows with the optimum use of the land while getting the best productivity from our workforce in a mutually beneficial way.” he said.

Gowri Shankar, CEO G&G Group of Companies, Singapore noted,” There’s a shortage of coffee in India, so it will be a potential market for our unique Sri Lankan coffee brand apart from the U.S., and Australia markets. South India loves coffee over tea and North India’s preferred beverage is tea. So, our coffee has a great opportunity to enter the South Indian market. Hence, we are looking at these three key markets for exporting our coffee.”

“Some other companies also have started growing coffee, but we are the largest producer of coffee at present. We will be setting up our coffee processing unit in the next two years which will cost about Rs. 200- 300 million. By 2026, HPL PLC’s coffee will come to the local market and exports will commence in 4 years down the line”, Menaka Athukorala said.

Touching on their tea plantations, HPL PLC said that they have started deploying mechanization, precision agriculture and tech solutions to make their operations more efficient.

HPL has already started using drone technology to apply Foliar Spray on some of their estates to deliver essential nutrients directly to the tea leaves.

“Drones are being used in pilot projects to streamline the operational process, to increase the productivity in the fields and to make the monitoring more efficient and automative,” they said.

“We are upgrading the facilities being provided to our field workforce with convenient access to toilets and bathing places. We have a workforce of 4,000 on permanent basis and an equal number on a casual basis. The issue of labour wages has not caused us much of a problem because we have so many welfare activities that ensure our workers’ well-being.”

“We are going to set up a vocational training institute on our estate in Hatton to train the children of our workers in various crafts. With the new-found skills, they can choose to work with us or go and be employed or self-employed elsewhere. We believe such socially responsible activities will foster stronger bonds between the company and the employees. That bond will take care of the whole ecosystem of Hatton Plantations for many years to come,” they said.

“For diversification in tourism, we are looking at strategic partnerships whose mainstream business is tourism. We don’t want to get into their line of business. As the infrastructure is already there with HPL’s holiday bungalows and picturesque tea estates, we will see who understands its value and bring their expertise of tourism to our assets. We will see how we can leverage those assets together with them and grow the business,” Gowri Shankar said.

Hatton Plantation PLC’s profit before tax was Rs. 1.2 billion in 2024. This year it will be slightly less because of the wage increase, and it is expected to be close to one billion rupees in FY 2024/25. And in FY 2025/26, the company expects a PBT of Rs. 1.3 billion when tech modernizations are successfully implemented.

“We have liquid cash assets that we would like to channel into these verticals. In the meantime, we are looking at the possibility of investing in tea plantation in Kenya as there is an opportunity to produce orthodox leafy teas in that country – where your yields are higher and profit margins are much greater,” they said.

The media was told that HPL was keen on investing in viable solar power projects anywhere in Sri Lanka that generates more than 5 megawatts of power.

Currently, HPL has eight hydro-power plants generating 12 megawatts. Lotus Hydro Power of the Group is the highest dividend-yielding company in the domain with around 14% yield rate, consistently maintaining it from 2014, except for the crisis-years in Sri Lanka.

“Hatton Plantations is willing to allocate Rs. 1 billion to invest in a viable solar project and we’d be happy to talk to the right partners”, “Gary Seaton said.

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Business

CBSL keeps overnight policy rates unchanged; latest review of IMF program awaited

Published

22 hours ago

2026/01/29

Sahan Weerasooriya

Dr. Nandalal Weerasinghe

The Central Bank kept its overnight policy rate unchanged yesterday as it awaited the latest review of a US $2.9-billion International Monetary Fund programme.

‘The Central Bank will maintain the overnight policy rate at 7.75 percent and stable inflation, healthy credit growth and steady economic expansion are the reasons for the decision, Central Bank Governor Dr Nandalal Weerasinghe said. The Central Bank Governor stated this yesterday at the monthly policy review meeting held at Central Bank head office in Colombo.

‘The Board arrived at this decision after carefully considering evolving developments and the outlook on the domestic front and global uncertainties, the Governor said.

Dr Weerasinghe said that the Board is of the view that the current monetary policy stance will support steering inflation towards the target of 5 percent

The CBSL Governor added: ‘Inflation measured by the Colombo Consumer Price Index (CCPI) remained unchanged at 2.1 percent in December 2025. However, food prices edged higher in December compared to November.

‘ This was due to supply chain disruptions caused by Cyclone Ditwah and higher demand for food during the festive season.

‘Inflation is projected to accelerate gradually and move towards the target of 5 percent by the second half of 2026. Core inflation, which excludes price changes in volatile food, energy and transport from the CCPI basket, has also shown some acceleration in recent months.

‘Core inflation is expected to accelerate further as demand in the economy strengthens. Meanwhile, inflation expectations appear to be well anchored around the inflation target.

‘The economy grew by 5.0 percent during the first nine months of 2025. Despite the slowdown in economic activity following Cyclone Ditwah in late 2025, early indicators reflect greater resilience.

‘Credit disbursed to the private sector by commercial banks and other financial institutions continued its notable expansion in late 2025.

‘This reflects increased demand for credit amid improving economic

activity and increased vehicle imports. Post-cyclone rebuilding is expected to sustain this momentum.

‘The external current account is estimated to have recorded a sizeable surplus in 2025, despite the widening of the trade deficit. Foreign remittances remained healthy during 2025.

‘Despite large debt service payments during the year, Gross Official Reserves were built up to USD 6.8 bn by the end of 2025.

‘This was mainly supported by the net foreign exchange purchases by the Central Bank and inflows from multilateral agencies. The Sri Lanka rupee depreciated by 5.6 percent against the US dollar in 2025 and has remained broadly stable thus far during this year. This includes the swap facility from the People’s Bank of China.

‘The Board remains prepared to implement appropriate policy measures to ensure that inflation stabilises around the target, while supporting the economy to reach its potential.’

By Hiran H Senewiratne

Business

Janashakthi Finance records 35% growth in Net Operating Income and LKR 389 Mn. PBT in Q3 FY26

Published

22 hours ago

2026/01/29

Sahan Weerasooriya

Rajendra Theagarajah, Chairman / Sithambaram Sri Ganendran, Chief Executive Officer

Janashakthi Finance PLC, formerly known as Orient Finance PLC and a subsidiary of JXG (Janashakthi Group) announced a strong financial performance for the nine-month period ended 31 December 2025, driven by sustained growth in its core businesses, disciplined execution and continued focus on scale and efficiency.

Commenting on the results, Rajendra Theagarajah, Chairman of Janashakthi Finance PLC, said, “The performance for the period reflects the clarity of our strategic priorities and the strength of our governance framework. With strong leadership in place that is confidently driving the business, we continue to grow steadily while maintaining balance sheet strength and stakeholder confidence.”

For the period under review, Profit Before Tax (PBT) rose by 39% year-on-year to LKR 389 million, supported by higher operating income and portfolio expansion. Net Operating Income increased by 35% year-on-year to LKR 2.2 billion, reflecting sustained lending activity and improved business scale.Net Profit After Tax (NPAT) amounted to LKR 240 million.

The Company’s Loans and Receivables portfolio grew by 49% year-on-year to LKR 29 billion, driven by demand across key lending segments and focused growth initiatives. Deposits increased to LKR 17 billion, recording a 14% year-on-year growth, reinforcing funding diversity and customer confidence.

Reflecting on the year’s progress, Sithambaram Sri Ganendran, Chief Executive Officer of Janashakthi Finance PLC, stated, “During the period, we focused on expanding our loan book responsibly, strengthening our funding base and enhancing operational capability. The growth achieved across our key indicators positions the Company strongly as we continue to execute our medium-term strategy and respond to market opportunities.”

Business

JKH posts strong Q3 EBITDA growth of 68% to Rs.23.76 billion driven by momentum across the portfolio

Published

22 hours ago

2026/01/29

Sahan Weerasooriya

Chairperson and CEO Krishan Balendra

Summarised below are the key operational and financial highlights of our performance during the quarter under review:

The Group continued to deliver a strong performance, with all businesses reporting improved profitability.

The operationalisation of two of the Group’s largest projects, the City of Dreams Sri Lanka integrated resort and the West Container Terminal (WCT-1) at the Port of Colombo, continued to progress well. The encouraging quarter-on-quarter momentum demonstrates the strong ramp up potential of both projects.

The country faced an unexpected challenge in November with Cyclone Ditwah, which impacted parts of Southeast and South Asia. The cyclone caused loss of lives, affected a significant portion of the population, and resulted in considerable infrastructure damage in certain areas of Sri Lanka. While the operations of the Group were disrupted during the few days of the cyclone, there were no significant operational or financial impact as a direct result of the cyclone and related flooding.

The Group and its staff supported relief efforts through various initiatives, including a substantial contribution of Rs.500 million from John Keells Holdings PLC and its affiliate companies towards the Government’s ‘Rebuilding Sri Lanka’ initiative.

Group earnings before interest, tax, depreciation and amortisation (EBITDA) at Rs.23.76 billion in the third quarter of the financial year 2025/26 is an increase of 68% against Group EBITDA of Rs.14.15 billion recorded in the third quarter of the previous financial year.

Cumulative Group EBITDA for the first nine months of the financial year 2025/26 at Rs.55.10 billion is an increase of 84% against the EBITDA of Rs.29.94 billion recorded in the same period of the financial year 2024/25.

During the quarter under review, the Group recorded fair value gains on investment property amounting to Rs.2.30 billion [2024/25 Q3: Rs.955 million], and net exchange losses of Rs.759 million [2024/25 Q3: gain of Rs.782 million], mainly due to the impact of the deprecation of the Rupee on the foreign currency denominated loan at City of Dreams Sri Lanka.

Profit attributable to equity holders of the parent is Rs.6.48 billion in the quarter under review, which includes fair value gains on investment property and net exchange losses amounting to Rs.1.45 billion. Profit attributable to equity holders of the parent for the corresponding period of the previous financial year was Rs.2.85 billion, which included fair value gains on investment property and net exchange gains amounting to Rs.1.70 billion.

The second interim dividend for FY2026 of Rs. 0.10 per share is aligned with the first interim dividend paid in November 2025. This reflects the expectation that the current momentum of performance will sustain or further improve going forward. The outlay for the second interim dividend is Rs.1.77 billion, which is an increase compared to Rs.881 million in the previous year.

(JKH)