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NDB shows strong growth, rising investment potential

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In a striking testament to both corporate resilience and a recovering macroeconomic environment, the National Development Bank (NDB) has delivered a set of third-quarter results for 2025 that far exceed market expectations. The figures, detailed in a recent analysis by First Capital Research (FCR), paint a picture of a financial institution leveraging favourable conditions to accelerate growth, justify upward revisions in valuation, and present a compelling case to investors for long-term value creation.

The headline figure is arresting: a 145.6% year-on-year surge in earnings for 3Q2025. This explosive growth was primarily engineered by a dual engine of stronger net interest income, which grew 13.8% YoY to LKR 9.1 billion, and a significant 24.3% rise in net fee and commission income. The former benefits directly from the prevailing low-interest-rate environment, which has helped margins and stimulated borrowing, while the latter points to broad-based business momentum across the bank’s operations, from trade finance to its digital platforms. A remarkable leap in other income – to LKR 1.04 billion from a mere LKR 27.7 million a year earlier – further bolstered the bottom line.

Perhaps as encouraging as the income growth is the notable improvement in credit quality. Impairment charges declined by a substantial 46.9% year-on-year, a clear signal of improving macroeconomic conditions and a healthier loan book. This trend underscores a banking sector that is emerging from the shadows of past economic stress with greater stability.

Buoyed by this outperformance, FCR has significantly revised its earnings forecasts upward. Their 2025 estimate has been lifted by 33.5% to LKR 11.6 billion, and the 2026 forecast by 26.1% to LKR 13.2 billion. This positive reassessment flows directly into the bank’s perceived fair value. FCR now assigns a fair value of LKR 180.0 per share for 2025, implying a 27% potential upside, and LKR 200.0 for 2026, suggesting a 42% increase from current levels. When expected dividend per share (DPS) returns are included, the total return projections become even more attractive, estimated at 33% for 2025 and 48% for 2026.

First Capital maintains a “BUY” recommendation on NDB, citing a constructive outlook founded on a favourable macro backdrop and stable interest-rate trends. These factors are expected to continue fuelling loan book expansion. Furthermore, growth in trade finance and an accelerating adoption of digital banking services are anticipated to provide sustained momentum to fee-based earnings, diversifying the bank’s revenue streams.

However, the report does not ignore the clouds on the horizon. It highlights near-term risks to asset quality, particularly stemming from recent adverse weather events. Given NDB’s sizable exposure to the Small and Medium Enterprise (SME) sector, which is often vulnerable to such disruptions, the analysis expects a possible uptick in non-performing loans (NPLs) in the coming quarters. This is a prudent note of caution for investors, emphasizing that the recovery path may not be entirely smooth.

Nevertheless, the overarching narrative from these results is one of a bank positioned at the confluence of economic recovery and strategic execution. NDB appears to be translating improved national economic indicators into robust financial performance. Its “resilient base,” demonstrated by strengthening fundamentals and declining impairments, provides the foundation for “rising potential,” captured in the revised earnings and fair value estimates.

For the investing public, the message from this analysis is clear: NDB is presented as a institution harnessing the winds of economic change to propel itself forward. While mindful of sector-specific risks, the data suggests a strong trajectory for growth and value appreciation, making it a standout candidate for potential investors.

By Sanath Nanayakkare



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First Capital Holdings records Rs. 3.23Bn Total Comprehensive Income for 9M FY2025/26

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First Capital Holdings PLC, a subsidiary of JXG (Janashakthi Group) and a pioneering force in Sri Lanka’s investment bank landscape recorded a Total Comprehensive Income of Rs. 3.23Bn for the nine months ended 31 December 2025, compared to Rs. 4.53Bn in the corresponding period of the previous year. For the third quarter of 2025/26, the Group reported a Total Comprehensive Loss of Rs. 0.17Bn, after accounting for a dividend tax expense of Rs. 0.41Bn.

The Group’s Net Income before Operating Expenses for the nine months of 2025/26 amounted to Rs.6.33Bn compared to Rs. 7.69Bn reported in the corresponding period of the previous year. Trading income was primarily driven by the Primary Dealer and Corporate Dealing Securities divisions, reinforcing the Group’s positioning across fixed income and equity market segments.

The Primary Dealer division reported a Profit after Tax of Rs. 1.64Bn for the nine months ended 31 December 2025 (1st nine months of 2024/25 – Profit after Tax of Rs. 2.45Bn). The results include trading gains on the government securities portfolio of Rs. 1.66Bn and net interest income of Rs. 1.41Bn (1st nine months of 2024/25 – trading gains of Rs. 3.18Bn and net interest income of Rs. 1.31Bn), reflecting movements in yields and trading conditions during the period.

The Corporate Finance Advisory and Dealing Securities division recorded a Profit after Tax of Rs. 1.86Bn for the nine months ended 31 December 2025 (1st nine months of 2024/25 – Profit after Tax of Rs. 1.94Bn). The business unit reported total trading gains of Rs. 2.33Bn on its equity portfolio, compared to Rs. 2.23Bn in the corresponding period of the previous year, supported by market participation and portfolio positioning.

The Wealth Management division reported a Profit after Tax of Rs. 78.1Mn for the nine months ended 31 December 2025 (1st nine months of 2024/25 – Profit after Tax of Rs. 90.1Mn). Assets under Management stood at Rs. 96.4Bn as at 31 December 2025, compared to Rs. 115.9Bn as at 31 March 2025, reflecting market conditions and client portfolio adjustments.

The Stock Brokering division recorded a Profit after Tax of Rs. 166.3Mn for the nine months ended 31 December 2025, compared to Rs. 39.5Mn reported in the corresponding period of the previous year, supported by increased trading activities.

Commenting on the Group’s performance, Rajendra Theagarajah, Chairman of First Capital Holdings PLC, stated, “The operating environment during the period was shaped by shifts in interest rates, capital market activities, and fiscal adjustments. Against this backdrop, the Group’s performance reflects the structural strength of its capital markets platform and its ability to generate income across multiple market cycles while maintaining financial discipline.”

Dilshan Wirasekara, Managing Director / CEO of First Capital Holdings PLC, said, “Our priority during the period was to manage each business line with a clear focus on risk, liquidity and execution. Improved performance in stock brokering and consistent contributions from corporate finance reflect our ability to respond to market conditions while aligning capital deployment with client and market opportunities.”

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Keells Nexus introduces an all new Loyalty App

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Keells is set to usher a new chapter in customer experience with the relaunch of Keells Nexus with the introduction of its all-new loyalty app on 13th February. For 25 years, Keells Nexus has been at the heart of Sri Lankan retail, pioneering coalition loyalty and even introducing mobile-based loyalty as early as 2014. The loyalty program is building on this legacy, combining state-of-the-art technology with richer, more personalized rewards and seamless integration across the Keells ecosystem with an intuitive mobile experience.

Today, Keells Nexus stands at over 2 million registered members, a reflection of the trust customers place in Keells and the brand’s commitment to improving the quality of life for the nation. The launch further strengthens Keells’ long-standing focus on tech-enabled retail efficiency, following innovative retail experiences to customers such as self-checkout counters and retail technology that drives efficiency such as advanced inventory management systems.

The new app therefore is the next logical step in this journey, bringing together rewards, offers, and account visibility in one intuitive, streamlined interface. The new Keells Nexus app brings together all deals, savings and partner offers in one place, giving customers complete visibility and control. Members can track their points in real time, scan a QR code at checkout to earn rewards instantly, and enjoy a more personalised, more connected shopping experience.

“At the heart of Keells Nexus is a simple but powerful belief that life is better when we’re connected,” said Nilusha Fernando Head of Marketing, Keells Supermarkets & Senior Vice President, John Keells Group.

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IDL, Clouds by SOZO and the Rukmini Tissanayagam Trust partner with the HSBC Ceylon Literary & Arts Festival 2026

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The HSBC Ceylon Literary & Arts Festival 2026, taking place from 13 to 15 February at Cinnamon Lakeside, Colombo, promises to be one of those rare cultural moments that linger long after the last session ends. It is a gathering not only of writers, artists and thinkers, but of ideas, shared, challenged and celebrated in spaces where curiosity feels welcome.

The HSBC Ceylon Literary & Arts Festival 2026 is supported by several organizations through non-promotional CSR initiatives, including Clouds by SOZO and the Rukmini Tissanayagam Trust. International Distillers Limited contributes in a strictly neutral CSR capacity, providing logistical and resource support for the event without any brand promotion or product visibility.

The Festival celebrates Sri Lanka’s creative voice by showcasing literature, arts, and cultural talent from across the country. All supporting organizations participate solely in a philanthropic and educational role, ensuring that the focus remains on artistic expression and community engagement.

The Rukmini Tissanayagam Trust brings to the Festival a deep and enduring commitment to nurturing literature and the arts as essential pillars of society. Its work is driven by the belief that creative spaces are not optional additions, but vital platforms that shape how communities think, feel and engage with the world around them.

Speaking on this collaboration, Indhu Selvaratnam, Director of SOZO Beverages and Trustee

of The Rukmini Tissanayagam Trust, stated, “The Rukmini Tissanayagam Trust is delighted to partner with the Ceylon Literary Festival for the second time. We are deeply committed to enriching Sri Lanka’s intellectual and cultural landscape and admire the festival’s evolution in embracing literature, art, music, and initiatives that nurture emerging local talent. These efforts align closely with the Trust’s mission to support creative expression, and we look forward to continuing our support as the festival strengthens Sri Lanka’s global cultural presence.”

Adding a complementary dimension to this partnership is Clouds by SOZO, Sri Lanka’s premium mountain spring water brand, whose ethos of purity, sustainability and thoughtful living aligns naturally with the spirit of the Festival. Sourced from a pristine spring in the Knuckles mountain range, Clouds represents a return to authenticity, an idea that resonates strongly within creative and cultural spaces.

Speaking on the partnership, Dushyantha De Silva, Founder of SOZO Beverages (Pvt) Ltd, said, “The arts invite us to slow down, to observe, and to think more deeply, and Clouds comes from that same place of intention. Supporting the HSBC Ceylon Literary & Arts Festival is about being part of a space where ideas flow freely and thoughtfully. It’s a privilege for us to align with a platform that values creativity, dialogue and conscious choices.”

The HSBC Ceylon Literary & Arts Festival 2026 offers something increasingly rare: three uninterrupted days of ideas. Of language and imagination. Of conversations that do not require a screen to feel alive. It is a reminder of the power of gathering, of listening, discovering and engaging with perspectives that challenge and inspire.

As February approaches, the hope is simple: that more people choose to attend, to listen, and to support Sri Lankan creativity in all its forms. Because when a country invests in its writers and artists, it is not merely celebrating talent, it is shaping how it remembers, how it questions, and how it evolves.

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