Colombo’s stock market is witnessing a level of vibrancy not seen since 2011, with numerous company stakes changing hands and substantial wealth being created.
Stock market analysts have observed a growing positive sentiment among high-net-worth individuals, who are increasingly investing in company stakes with significant upside potential.
Earlier this month, businessman Dhammika Perera completed a 50:50 partnership with Laugfs Holdings Ltd, acquiring a 50 per cent stake through his private vehicle, Vallibel Three. Mr. Perera had previously purchased a 39.6 per cent stake from co-founder U.K. Thilak De Silva, who resigned from the boards of Laugfs Gas and Power PLC. This move follows Mr. Perera’s recent acquisitions of East-West Properties and DHT Cement Ltd.
In another major transaction, Browns Investments sold nearly a 10 per cent voting stake in Hatton National Bank (HNB) to tycoon Nandana Lokuwithana’s Ceylon Steel Corporation for Rs. 13.82 billion on May 27. Analysts noted this as one of the largest private sector deals on the Colombo Stock Exchange in recent times.
“There is substantial appreciation in certain share prices, with some firms reaching record levels. This encourages strategic holders to divest, unlocking significant value,” one market analyst explained.
Ambeon Group recently expanded its stake in Ceylon Hotels Corporation PLC to 10.79 per cent by acquiring an additional 3.95 per cent of ordinary voting shares. This follows last month’s purchase of a 6.84 per cent stake for Rs. 320 million. Additionally, Ambeon Holdings PLC acquired a 6.09 per cent stake in The Kandy Hotels Company PLC. Alumex PLC disclosed that Akbar Brothers Ltd. sold 80,169,400 shares, representing 13.39 per cent of the company’s total issued shares. Meanwhile, Ambeon Capital PLC acquired an 82 per cent stake in Mylands PLC for Rs. 252 million, including a direct purchase of a 51 per cent stake for Rs. 157 million.
Analysts also highlighted that state-funded infrastructure projects and government sector stability are bolstering investor confidence. Brantel Lanka has increased its stake in Resus Energy PLC, surpassing the 10 per cent ownership threshold to hold 8,620,385 ordinary shares.
“The current cost of capital is low and attractive to investors with borrowing capacity,” Senaka Kekiriwaragodage, CEO of NDB Capital Holdings Ltd, told The Sunday Times Business. “With single-digit capital costs, investors are spotting opportunities with high return potential.”
Mr. Kekiriwaragodage added that positive market momentum and economic growth are driving investor interest, particularly in the real estate sector. Prime Lands Residencies PLC recently expanded its portfolio by acquiring over an acre of prime land on Bambalapitiya Station Road for Rs. 3.5 billion. “Affordability, coupled with positive GDP growth and low interest rates, is creating a conducive environment for real estate transactions,” he said.
A stock market analyst further noted that single-digit interest rates are encouraging investors to buy stakes in banks rather than simply depositing funds. The capital market fundraising by listed companies has also contributed to the market’s heightened activity.
Additionally, analysts pointed out that the Colombo Stock Exchange has seen a surge in engagement, with 4,000 new monthly accounts recently opened, further increasing transaction volumes.
