JAT Holdings Ltd.’s maiden trading on the Colombo Stock Exchange (CSE) turned negative with the share closing over 10% or Rs. 2.80 lower from its IPO price to Rs. 24.20.

The debutant saw 8.68 million of its shares change hands via 2,379 trades generating a turnover of Rs. 224.2 million. 

JAT was the first listed entity in recent times to have closed below IPO price on the maiden trading day, prompting some to claim it spoilt investor sentiment and fared as expected since it was overpriced. 

However, others opined that market conditions were challenging and JAT could not stand out and shine even though the company is fundamentally sound and has great potential. 

JAT Holdings IPO of 82,904,846 Ordinary Voting Shares by way of a combination of an offer for subscription and an offer for sale at Rs. 27 each was oversubscribed by near two times on its official opening day on 20 July. The IPO was to raise Rs. 2.2 billion. Joint Financial Advisers and Managers to the offer are Capital Alliance Partners Ltd. and NDB Investment Bank Ltd.

Commenting on the listing, CSE Chairman Dumith Fernando congratulated the company: “We are pleased to welcome JAT Holdings Ltd. as the fourth equity listing on the CSE for the year 2021. JAT Holdings is a strong Sri Lankan brand and a leader in the industry. We are honoured to be facilitating their capital requirements for the company’s expansion projects in their objective of adapting to global trends and needs.”

JAT Holdings Founder and Managing Director/Executive Director Aelian Gunawardene welcomed the new shareholders to the company and added: “A journey of a thousand miles begins but with a single step, so observed the ancient Chinese philosopher Lao Tzu. Twenty-eight years ago, I embarked upon one such journey, founding JAT Holdings. The milestones I have passed along the way are many, however the listing of the company on the Colombo Stock Exchange has been one of our team’s top achievements. This has been a coveted goal since we embarked on our first round of private placements in 2014. We are honoured to state that JAT is the only company on the Colombo Stock Exchange entrenched in the paint manufacturing, marketing and exporting industry and can ensure our shareholders enjoy great returns in the short and long terms.”

He also said that JAT had already set out to fulfil, far ahead of schedule, the commitments made to trusted shareholders by securing the required premises and factory for manufacturing purposes in Bangladesh and shipping out the required machinery. Further JAT has just purchased the required land to build its state-of-the-art R&D centre.

“As a result, the revenue, and subsequent targets from manufacturing and R&D given in our prospectus can now be brought forward. Our Chairman Dr. Siva Selliah, the Board of Directors and I wish to thank all those who have assisted us on this journey. Those include our joint financial advisers and managers to the offer CAL and NDBIB, our secretaries to the issue, our CEO Nishal Ferdinando, the entire team at JAT and all our shareholders who have showed unstinting faith in the company,” Gunawardene said.

CAL Managing Director – Global Markets and Investment Banking Deshan Pushparajah remarked: “As the undisputed giant in the wood coatings space in Sri Lanka, Bangladesh and the Maldives, JAT is a shining example of how Sri Lankan businesses can compete and succeed on the global stage. 

“CAL is proud to have partnered with JAT on this landmark IPO as Joint Financial Advisor and Manager to the offer. We wish to congratulate JAT on its trading debut and wish the leadership team the very best for the future.”

NDB Investment Bank Director/CEO Darshan Perera said: “The IPO of JAT was a novel offering to the market in that it was the first paints and furnishing company to list on the CSE. It is indeed a positive development to see promoters who have built solid businesses opting to list on the CSE and share their growth stories with the investing public. We at NDBIB are honoured to have partnered with JAT on this milestone event as Joint Financial Advisor and Managers to the Offer and I wish JAT all the very best in its future growth prospects as a listed entity on the CSE.”

Stock market suffers sharp drop amidst  Rs. 4 b turnover