South Asia Textiles Limited, a BOI company will soon list in the Colombo Stock Exchange (CSE), the Director General of the Securities and Exchange Commission of Sri Lanka Channa De Silva said.
`South Asia Textiles is a Singaporean owned company and has been in Sri Lanka for about five years. It is a sizable company with an estimated value exceeding Rs. 2 billion.
`They hope to list in two months time and they hope to raise a substantial amount through the equity issue,` De Silva said.
The offer to make a listing has come through City National Bank of Singapore.
De Silva said four other companies have made positive indications that they would list in the CSE within the year.
`One of these companies is into power generation while the other three are manufacturing companies,` De Silva said.
The Securities and Exchange Commission has been trying to develop a vibrant capital market in Sri Lanka so that companies can raise capital without having to depend on bank credit.
At the moment, analysts believe the economy is over dependent on the banking system which leaves the entire financial system vulnerable.
The banks themselves know they are over stretched and several senior bankers have time and time again asked that the government reduce policy rates in order to make the capital market more appealing to investors so that banks can then raise the necessary capital in order to lend.
The SEC is also lobbying to have the Central Bank and other government institutions invest more funds from the employee provident funds in their custody so as to give a return above the rate of inflation so that a real positive return is given to these savings.