CSE market cap tops Rs. 8 t as real returns surge 65% – CBSL

Wednesday, 15 October 2025 00:44 - - {{hitsCtrl.values.hits}}

Sets new benchmark after market cap grew 40.48% YTD yesterday, crossing Rs. 8 t for first time
Latest CBSL report says inflation-adjusted real equity market returns up 65.1%
Points to upside potential with 9.8% PE ratio below 12.13% long-term average

The Colombo Stock Exchange (CSE) crossed a major milestone yesterday as total market capitalisation exceeded Rs. 8 trillion for the first time, marking a 40.48% gain so far this year.

According to the Central Bank of Sri Lanka’s (CBSL) Financial Stability Review 2025 released last week, the stock market has delivered exceptional real returns over the past two years.

The inflation-adjusted All Share Total Return Index (ASTRI) posted an average real gain of 65.1% up to August 2025, compared with 24.8% in 2024 and a negative 5.8% in 2023.

The Central Bank said the performance was driven by strong market capitalisation growth, continued disinflation, and robust dividend pay outs; all of which bolstered bullish investor sentiment.

Average daily turnover during the first eight months of 2025 climbed to Rs. 4.84 billion, more than double the Rs. 2.24 billion recorded in 2024.

Valuations also reflected renewed optimism, CBSL noted.

The Price-to-Book ratio rose to 1.41 at end-August from 1.17 at end-2024, while the Price-to-Earnings ratio reached 9.81, still below the long-term average of 12.13 and regional peers.

CBSL said that these levels indicate room for further growth, supported by improved corporate performance and strengthened macroeconomic stability.