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The Stock Market identified as a willing and able source to fund digital transformation

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The Federation of Information Technology Industry Sri Lanka (FITIS), the Colombo Stock Exchange (CSE) and the Information and Communication Technology Agency (ICTA) recently conducted a webinar titled “Financing Digital Transformation: Is Going Public the Next Step?”, focusing on how companies in the IT industry can now consider a stock exchange listing in view of the recent changes to CSE listing eligibility.

The discussion focused on the expansion of the eligibility criteria for an initial listing of shares on the Main Board and the Diri Savi Board which will now enable a wider spectrum of companies to qualify for a listing.

The webinar featured capital market and tech industry experts including Chairman of FITIS Abbas Kamrudeen, Director/legal Adviser of ICTA Jayantha Fernando, CSE CEO Rajeeva Bandaranaike, CSE Chief Regulatory Officer Renuke Wijayawardhane and Founder/CEO of Pickme Jiffry Zulfer.

Director/Legal Adviser of ICTA Jayantha Fernando said that global success stories have helped catalyze a shift among private-company leadership toward viewing public markets as a more welcoming place to raise capital.

The stock market engine should be recognized as a tool within this ecosystem which, if correctly used, could pave the way for not only companies to grow but for the economy at large to grow as well, he noted.

Sharing his thoughts at the webinar, the Chairman of FITIS Abbas Kamrudeen said, “When it comes to financing, there are many options companies can evaluate from bootstrapping, Angel investors, debt capital, Venture Capital to private equity. But my belief is that for those companies that have matured to some extent, there is no better option to financing than going public. The reason being, it not only gives you flexibility and speed in future rounds of financing, but it will also allow you to understand the true value of your organization.”

The CEO of CSE Rajeeva Bandaranaike shared the perspective on the rationale for the CSE to revamp its listing requirements to cater to an ever-evolving business landscape in Sri Lanka consisting of modern and dynamic business models, which are particularly seen in the technology space.

He outlined that these new changes are now well placed to attract a wave of tech companies to the local stock market.

The Chief Regulatory Officer of CSE Renuke Wijayawardhane, highlighting these new avenues for companies stated, “Companies that ideally could not look at a listing on the main board as a result of the three consecutive year profit requirement now have other options. Companies with positive net assets for two financial years could list on the CSE with an aggregate net profit after tax for three years, an alternate which does not require companies to be profitable for three consecutive years.”

He added: “To broaden the entry routes, we have also introduced revenue and cashflow options in addition to the two profit-based routes. Companies could now demonstrate either an aggregate revenue of Rs. 3 billion for three financial years or positive operating cashflow after adjusting for working capital for two consecutive years. The revenue and cashflow route could be explored by companies capable of demonstrating a market capitalization of Rs. 5 Billion or more at the point of listing.”

Companies have also been given the opportunity of listing on the Diri Savi Board by demonstrating a revenue of Rs. 350 million for the financial year immediately preceding the date of the initial listing application and a market capitalization of Rs. 2 billion at the point of listing”, he added.

Speaking from an Investment Bank’s perspective, Head – Corporate Advisory at NDB Investment Bank, Nilendra Weerasinghe noted the progressive steps taken by the CSE to encourage tech companies to raise capital in the public markets.

“We need more private capital flows to support SMEs and startups to make it to the big league. In doing this, policies which incentivize private capital investments into angel and venture capital fund like structures could catalyze this space having a significant impact on the broader economy”, he further said.

Renowned tech entrepreneur and CEO of Pickme Jiffry Zulfer identified the stock market listing as an ideal exit option for investors and private equity firms investing in start-ups.

He went on to note that having the stock market listing as an option and a possible exit mechanism will help the growth of the start-up ecosystem in Sri Lanka by attracting a wider audience of investors who see the value of a market-based exit mechanism.

Companies are invited to connect with the CSE to discuss how they can now tap into public funding to spur on the company’s growth agenda. Details on eligibility of listing and the process could also be obtained through www.cse.lk or by sending an email to maalik@cse.lk

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Govt. suspended Sectoral Oversight committees to prevent discussion on 20A – Opposition Leader

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By Saman Indrajith

Opposition Leader Sajith Premadasa accused the government of suspending the functioning of Sectoral Oversight committees to avoid the 20th Amendment being discussed.

Raising a point of Order on Thursday in Parliament, soon after government members moved a motion to suspend the functioning of Sectoral Oversight Committees, the Opposition Leader demanded to know the objective and rationale behind the motion.

“This is a gross violation of democratic process. You are trying to bypass the process,” he protested.

Leader of the House, Minister Dinesh Gunawardena presented the motion to suspend the committees until establishing Parliamentary Consultative Committees under the proposed 20th Amendment to the Constitution.

Leader of the Opposition Premadasa and JVP lead NPP Leader Anura Kumara Dissanayake objected to the motion.

Premadasa said that the Sectoral Oversight Committees had the power to inspect the bills presented to parliament before they are considered in the House.

The committees are there to analyze, appraise, and evaluate the bills and have the powers to indicate the conditions and circumstances in necessity or desirability of enacting new legislations. Now when the committees are suspended the government does not need to worry of the changes being suggested at the committee for the 20th Amendment, he said.

He said that the Government tried to avoid the 20th Amendment to the Constitution being discussed at the Sectoral Oversight Committee.

Speaker Mahinda Yapa Abeywardena said that the issue came up earlier and as a result SJB MP Mayantha Dissanayake was assigned to study the matter and to present a report regarding it.

Opposition Leader Premadasa then queried as to why the committees are going to be suspended before receiving the said report.

Leader of the House Minister Gunawardena said that the opposition leader had not read the motion properly. The motion was presented to suspend Sectoral Oversight Committees until the appointment of Members to them, the Minister said.

JVP leader Dissanayake said that the committees should not be suspended until the said report is presented. The motion says that the suspension is till new members are appointed to them. That is the tricky point. There are concerns about the sectoral oversight committees and we are awaiting a report. The report could propose some changes, or to continue the committee in their present form or to abolish them.

“Those are the possible recommendations of the report. We could suspend the committees till the report is ready. But the government is suspending them till new members are appointed. The prime minister knows the trick. That was the same method he employed while he was the president to prevent the functioning of independent commissions under the 17th amendment to the constitution. The law was passed to set up commissions but they could not function for nearly five years because the members were not appointed to them. So the same trick is being played once again. There would be no appointments to the sectoral oversight committees so that they would not function if we pass the motion,” the MP said, asking the speaker to give a ruling on the matter.

Speaker Abeywardena: There is no need for me to give a ruling, put it to the House and make a decision.

Leader of the House Minister Gunawardena asked whether the House agreed and the government MPs shouted ‘aye’. The motion was passed.

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Yahapalana govt. made use of CID and police to frame their political opponents – MP Jayasekara

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By Saman Indrajith

Murder convict, Ratnapura district SLPP MP Premalal Jayasekara told Parliament on Thursday that the way the yahapalana government made use of the CID and police to frame their political opponents was now unfolding in the media.

Participating in an adjournment debate on the Finance Commission, the MP said: “I think there would be some more terrifying stories on how the yahapalana political leaders got certain officials such as Shani Abeysekera to tamper with evidence while also fabricating evidence to achieve their political objectives by bending the law according to their whims and fancies.

When these stories come out, people who voted for the SLPP to send the yahapalana government home, will be proud of their choice. They understand that they did a yeoman service to the entire nation by voting to change that regime. People can be happy that they voted for the SLPP to end such a tyrannical government.”

The MP said that Shani Abeysekera and several others now under investigation for ‘making’ and ‘breaking’ cases by forcing witnesses to give evidence had played a role in investigations against him. “There will dawn a day when the truth will come out,” the MP said.

He further said that not all the police officers were corrupt and politically motivated such as Shani and others under investigation. “There are many gentlemen in uniform. Amongst them there are highly corrupt officers such as Shani,” he said.

“Similarly there are many untold stories about prison officers. We saw in the media recently some reports of corrupt officers. Just like in the case of the police, not all prison officers are corrupt. There are some bad eggs. One of the reasons might be the poor salary and facilities they get. Since I am now in prison, I see these things”, the MP noted.

He added: “I happened to read a letter from a jailor describing how hard their lives are. I table that letter. It shows the hard life they live while they are on duty. We know that the salaries of police officers were increased by 40 percent recently. But prison officers did not get a raise. I propose that their salaries be increased because that would at least ease their burden,” MP Jayasekera said.

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US donates locally procured Personal Protective Equipment to support SL’s COVID-19 Response 

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COLOMBO, September 24 – 

US Ambassador to Sri Lanka and Maldives Alaina B. Teplitz donated Personal Protective Equipment (PPE) to Sri Lanka’s Minister of Health, Pavithra Wanniarachchi as part of the United States’ ongoing assistance to Sri Lanka in its response to COVID-19.  

The donation includes 23,000 masks, 24,000 nitrile gloves, 600 isolation gowns with hoods, 60 infrared thermometers, 50 portable oxygen concentrators with a large supply of expendable equipment to support their operation, and disinfectants.  The total value of donation was $191,000. 

 The donation was funded by the US Department of Defense.  All items were procured locally in keeping with US efforts to support Sri Lanka’s local businesses and industry as they recover from COVID-19’s economic impact.  As part of its private sector engagement with the apparel industry and the Sri Lanka’s Export Development Board, the United States has funded capacity building trainings that have aided new exporters in accessing the US market. 

 “These donations from the American people accomplish two shared goals: protecting the health and safety of Sri Lankans and supporting Sri Lankan jobs,” said Ambassador Teplitz.  “Providing sustainable assistance that enables Sri Lanka’s economic recovery is a hallmark of the U.S.-Sri Lanka partnership.”  

In Sri Lanka alone, the United States has provided more than $26 million in health assistance over the last 20 years and this latest donation, builds on more than $6 million in COVID-19 assistance in 2020.  On behalf of the American people, the Ambassador recently presented 200 brand-new, high-quality ventilators that enable Sri Lanka’s health providers to deliver quality care that could save lives.

Meanwhile, the American people are also helping Sri Lankan children resume their schooling via support for a national media campaign that encourages children and parents to follow seven important lessons to limit the spread of COVID-19. 

The United States continues to be one of the world’s largest providers of bilateral assistance in health. Since 2009, the American people have generously funded more than $100 billion in health assistance and nearly $70 billion in humanitarian assistance globally.  

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