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Melstacorp Ltd., Managing Director Amitha Gooneratne (Centre) with Colombo Stock Exchange Chairman Vajira Kulatilake and CEO Rajeeva Bandaranaike at the ceremonial bell ringing ceremony on Friday - Pic by Lasantha Kumara
The country’s newest listed diversified holdings, Melstacorp Ltd. (MELS), on Friday said it would capitalise on the booming tourism, energy, finance and insurance sectors, while maintaining balanced income generation from diversified interests going forward.
With the great potential seen in the hotel and leisure sector in which the group has direct investments through Aitken Spence Plc, the firm is keen on exploring more niche markets to grow its revenue, Melstacorp Managing Director Amitha Gooneratne told at a special bell ringing ceremony hosted by the Colombo Stock Exchange (CSE) upon its introduction to the market last week.
He added that the company had gotten a sound stream of investments through many of the top corporates listed on the CSE, which is producing an adequate return to MELS at present.
MELS commenced trading of 1.165 billion shares on 30 December 2016 by way of an introduction. The firm is listed on the Main Board of the CSE and has been classified under the Diversified Holdings sector. It was a decision by the shareholders of the Distilleries Company of Sri Lanka (DCSL) to establish Melstacorp as the holding company of the group, marking a modification in the ownership structure.
Describing MELS as a truly diversified conglomerate in Sri Lanka, Gooneratne stressed that the firm’s diversification ran into a range of businesses including alcohol, beverages, leisure and tourism, plantations, textiles, energy, finance, insurance, telecommunications and logistics.
However, going forward he pointed out that the greatest challenge for the group would be to blend the fusion of income received through different sources.
“Our main objective is to ensure that the income from the non-alcoholic beverage sector becomes almost equal, which would ensure an appropriate blend of revenue streams,” Gooneratne added.
He said the group was working on strategies to turn around its telecommunication arm, Lanka Bell Ltd, a more viable entity to contribute to revenue of MELS, noting that a substantial amount of the revenue went into Government coffers as frequency fees, VAT and various other levies paid on a yearly basis.
“In terms of Lanka Bell, we are looking at seeing how we can make it more efficient. We have made a heavy investment in the LTE and we are banking heavily on that sphere where only Dialog and Lanka Bell are providing those services at present and we feel there is potential there. We are looking at Lanka Bell in how it can be made profitable and contribute to the revenue of MELS,” he noted.
While stressing that the company did not have any direct overseas investments at the moment, Gooneratne insisted that MELS, being primarily an investment company, was open to all kinds of opportunities.
Gooneratne assured that MELS would endeavour to be a model corporate citizen satisfying or exceeding the expectations of all stakeholders in the years to come and acknowledged the stakeholders that worked through the process that resulted in a successful restructuring of the organisation.
CSE Chairman Vajira Kulatilaka said that the company’s significant market value, diversification and considerable public offering placed the introduction of MELS as an important development in the capital market.
“I consider the introduction of MELS an auspicious ending to a not so favourable year. This is a very attractive stock for local and foreign fund managers as well as retail traders. I am confident that you all will soon reach $ 1 billion in market capitalisation,” he added.
Kulatilaka extended an invitation to MELS to be a part of CSE’s road shows next year owing to the uniqueness of the company as well as to attract foreign investor attention toward Sri Lanka’s capital market.
Managing Director Amitha Gooneratne, Directors Royle Jansz, Capt. Jagath Kahanda, Vyjayanthimala Senaratne, Corporate Consultant Damien Fernando and the senior management of MELS were present at the ceremony while the CSE was represented by Chairman Kulatilaka, Chief Executive Officer Rajeeva Bandaranaike and members of the senior management. Other related senior representatives from the financial services sector were also present at the event.
MELS is a diversified conglomerate based in Sri Lanka with its business interest spanning Beverages, Plantations, Telecommunication, Financial Services and Other Diversified Sectors. The Distilleries Company of Sri Lanka Plc, Balangoda Plantations Plc and Browns Beach Hotels Plc, which are listed on the CSE, are subsidiaries of MELS. Furthermore, CSE-listed conglomerate Aitken Spence Plc and Madulsima Plantations Plc are associate companies of MELS.
