The CSE All Share Price Index has continued to perform well relative to the emerging and frontier market world and Colombo Stock Exchange (CSE) has rebounded strongly since the depths of the pandemic.
“The policy environment is conducive to strong valuations with low interest rates. We see an active local market participation and we are reinforcing proactive efforts to educate and promote the market while managing the risks locally by CSE and SEC,” Chairman, CSE, Dumith Fernando said. Investor participation at the CSE has changed since the pandemic and not unlike many other emerging markets.
“Though foreign investor participation has fallen from 44% of trading turnover in 2018 to 8% this year, domestic individuals who represented 22% of turnover in 2018 have grown its share to 56% this year.”
The market trading characteristics however have shown the depth of the local investor base given the right environment such as low interest rates and easier access to the exchange due to recent digitization efforts. Giving an overview he said that CSE’s Market Capitalization stands at about USD 18 billion, that’s about 23.2% of GDP. “Of this, about USD 16.7 bn [21.6% of GDP] is equity and about USD 1.3 bn [1.6 % of GDP] belongs to debt.”
“While economic winds have shifted, even through the extended civil war that ended 12 years ago, the CSE continued to be the primary venue for channeling funds to private companies while offering an attractive investment venue to investors.” (SS)
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