Financial Times

Lankan companies optimistic about future


Companies are expecting strong growth and increased opportunities from the peace dividend in the coming year, according to a survey conducted by MTI Consulting of Chief Financial Officers (CFOs).
At a Corporate Finance Forum this week, MTI Chief Executive Officer Hilmy Cader said companies are also looking towards value creation and cost optimisation.

The most critical issue for companies according to the findings of the survey is liquidity management. Mr. Cader added that there is optimism about the future following the end of the war although companies are still adopting a 'wait and see' approach.

Director of Frontier Research Amal Sanderatne who addressed the Forum said, 'the worst of times are behind us' although there were lessons learned during the tough times. Sri Lankan corporates operate with a cautious mindset which worked well during the global financial crisis, Mr. Sanderatne said. With the end of the war, he said the next two to three years may see a boost in domestic demand which will in turn stimulate growth. However, Mr. Sanderatne said interest rates need to stay low below 14%. The end of the conflict also reduces the risk perception which lowers the risk premium. He said there is no longer the 'doomsday factor' of bomb threats and violence.

Mr. Sanderatne also pointed out that only large mega cap listed firms can present themselves to foreign investors whereas small and medium firms should look at the domestic equity market in order to raise capital.

Attorney-at-law Harsha Cabraal who spoke on corporate governance said the current mandatory corporate governance code of the Securities and Exchange Commission (SEC) for listed companies is a step in the right direction but is not as comprehensive and wide-ranging as codes in other developed countries. The SEC's corporate governance for mandatory compliance in 2007 introduced requirements for independent directors, non-executive directors, audit committees and remuneration committees. The SEC also has a code of best practice which is voluntary for listed companies.

Top to the page  |  E-mail  |  views[1]
Other Financial Times Articles
> Motorists ‘must’ report accidents
> Helicopter flights on the rise after war
> SriLankan crew gets new kit
> Financial irregularities of Golden Key revealed
> CB investigates NTB forex loss
> North to double GDP contribution by end-2010
> COMMENT - Reporting accidents now compulsory
> Need for Fair Trade in Sri Lanka
> Tourism – Another perspective as the industry recovers
> PBJ plea in Supreme Court next month
> Classified at your finger tips
> CSE trading floor reopens tomorrow
> Rice snacks to hit the Sri Lankan market
> Concern over revenue, expenditure targets in budget
> Leo Burnett wins AME award for 5th consecutive year
> NDB launches operations in Bangladesh
> Lankan companies optimistic about future
> Central Bank purchased $652 million this year to prop forex reserves
> Citi Sri Lanka names new CEO
> Lanka shippers seek lower insurance premiums
> Lecture on business in post-war Sri Lanka
> 'Hikka Fest' biggest beach show in Asia says Mustapha
> HSBC named best global bank by Euromoney magazine
> US economy on recovery but oil and food prices to spike again
> IT-BPO Career Fair draws crowds in Kandy
> Comprehensive Resort Hotel Guide out in November
> Theva Residency opens in Hantana Kandy
> International Fiscal Association’s seminar on taxation
> Microsoft's Sinhala and Tamil versions now freely available
> Some directors of Ceylinco Shriram Capital Management remanded
> Lankan growth can be boosted through IT - Gates
> Ceylinco Life market share grows to nearly 35 %
> Company directors course from CIMA/SLID
> CB account for cash donations to relief effort
> Call for environmental professionals to intervene in garbage issues
> LMRB head steps down
> Saleem head-hunts for Maldivian Bank


Reproduction of articles permitted when used without any alterations to contents and a link to the source page.
© Copyright 2009 | Wijeya Newspapers Ltd.Colombo. Sri Lanka. All Rights Reserved.| Site best viewed in IE ver 6.0 @ 1024 x 768 resolution