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Prime Minister Mahinda Rajapaksa uses a tab to launch the new app of the Colombo Stock Exchange as part of the digitilisation drive initiative yesterday. State Minister of Money and Capital Market and State Enterprise Ajith Nivard Cabraal, SEC Chairman Viraj Dayaratne PC, CSE Chairman Dumith Fernando look on – Pic by Upul Abayasekara
By Nisthar Cassim
State Minister Nivard Cabraal yesterday issued a clarion call to the capital market to boost listings and value, thereby unleashing new investment and income opportunities in tandem with the new Government’s progressive measures.
Noting that the Colombo stock market hadn’t really progressed in the past five years, the new Money and Capital Market and Public Enterprise Reforms State Minister Cabraal said market capitalisation had halved to $ 12.5 billion in 2019 from $ 25 billion in end 2014.
“Now we need to grow this market again and make sure efforts are directed in making this market to expand as well. This is vital,” Cabraal told the ceremony to unveil the ground-breaking digitalisation initiatives championed by the Securities and Exchange Commission (SEC) and the Colombo Stock Exchange (CSE) in the presence of Prime Minister and Finance Minister Mahinda Rajapaksa. He said that there was a request for the Government to use the CSE to raise funds for development projects.
However Cabraal noted it was important first to broad-base the market and enhance value at a time when the latter had halved in the past five years.
“So set your sights high at $ 60 billion for the next five years. Then you have a capacity where you can provide funding not only for the Government sector but for the private sector as well, thereby the capital market can contribute towards the achievement of President Gotabaya Rajapaksa’s vision of ‘Vistas of Prosperity’ to the nation.
“I have been there long enough to know that the numbers of companies traded in this wonderful stock exchange have remained almost stagnant for so many years. We are around the 200 something level, and we have been at this number for the past 30 years,” Cabraal recalled.
“In the next five years we would like to see the number being spoken of as 500 something. You can do that,” he told the ceremony attended by capital market leaders. As at end 2019, the number of companies listed on the CSE was 289, down from 297 in 2018.
Speaking as part of the capital market stakeholder ecosystem, Cabraal said, “We have our work cut out,” and added the Government would extend support where necessary in addition to creating the right policy environment.
He also said that the SEC and the CSE must look at establishing a Board for listing of startups and BOI companies apart from the SMEs.
Commenting on the digitalisation initiatives, Cabraal said when the Central Depository System (CDS) and the Automated Trading System (ATS) were introduced in the 1990s, they were revolutionary. “Similarly I see the digitalisation initiatives unveiled today as revolutionary,” he added.
“You have started digitalisation and now you need to build on that foundation and further develop and broaden the market. There is plenty to do,” Cabraal added.
As part of the digitalisation initiative the CSE and SEC yesterday launched a transformative digital offering through the New CSE Mobile App, an end-to-end digital onboarding and online account opening feature that removes the barriers to entry for new investors and enables any eligible prospective investor around the country to open a CDS account to trade in the market without the need to visit a branch office.
The event also featured a further revamp of CSE and SEC digital touchpoints including new CSE SEC and CDS websites which were relaunched with user-friendly interfaces to offer browsers an informative browsing experience covering trading information, regulatory information as well as investor centric information maintained by the CDS. An investor education and financial literacy focused YouTube Channel to be managed by the SEC was also launched to create modern and digital learning opportunities for prospective investors, keeping with the growing demand for easily accessible learning opportunities.
With the new online account opening feature offered by the CSE Mobile App, prospective investors can now get started with investing instantly with their account opening, trading and settlement and monitor their accounts anywhere and anytime they want. It has also been enabled for them to access information designed specifically to make Informed investment decisions including access to research reports and interactive educational content to suit all types of investors. The platform is further designed to add value beyond the fundamentals of stock-trading, enabling companies to circulate media releases, host corporate videos and create an engaging digital experience for everyone involved.
