The Securities and Exchange Commission of Sri Lanka (SEC) conducted a forum for the Chief Financial Officers (CFOs) of several private companies recently to encourage them to list on the Colombo Stock Exchange (CSE).
The SEC has had a continuous dialogue with all stakeholders of the capital market and has emphasised on the need to take aggressive measures to develop the market in order to ensure that it is the preferred place to raise capital.
Only a few companies have listed on the CSE during the past several years and that was seen as one of the reasons for inadequate level of liquidity and relatively small size of the market. The SEC recently approved a new framework for listing of companies, granting complete autonomy to the CSE in the listing process and has also relaxed the Listing Rules to encourage more listings.
The aim of the forum was to reach out to companies that are not listed in order to make them aware of the benefits of getting listed and to apprise them of the key proposals included in the Government’s budget for 2021 which has provided certain tax exemptions to companies which list before December 31.
The Chairman of the SEC Viraj Dayaratne made the opening remarks and outlined the advantages of obtaining a listing, especially during the current positive market environment and said the process involved in listing a company was not as cumbersome or expensive as is generally perceived. He requested them to take the message to their respective Boards.
Presentations were made by the Chief Regulatory Officer (CRO) of the CSE, Renuke Wijayawardhane and Commission members of the SEC, Manil Jayesinghe and Naresh Abeysekera.
Wijayawardhane outlined the requirements and processes involved in listing and Jayesinghe explained in detail how listing on the CSE was an attractive option for companies to raise funds. He highlighted as to why this method of raising capital was more advantageous than other methods through which a company was able to raise capital.
Naresh Abeysekera outlined how the digital platform can be used to raise capital in the near future and benefits that listed companies can derive from the CSE mobile application.
The forum concluded with a panel discussion featuring the Chairman, the two Commission members, Director General Chinthaka Mendis and the CRO of the CSE. The panel discussion created the space for a dialogue between the panelists and the CFOs who participated at the forum.
The SEC plans to organise events where the Chairmen and CEOs of companies would be spoken to, to take this initiative forward.