TFC to launch IPO

by Surekha GALAGODA

The Finance Company, the oldest finance company in Sri Lanka will go for a share issue this month to infuse Rs 1.6 bln as fresh capital to the company.

The Director and the CEO of the company Kamal Yatawara said that the share issue will be a public placement with 40 mln shares at Rs 40 as voting shares while a private placement offering 100 mln shares at Rs 20 per share as non voting shares will be offered. The non voting shares will be offered to the depositors.

The move will benefit our loyal customers who have withstood the storms. He said that 85 percent of the depositors are willing to renew the deposits. The funds will be invested to get into the number one position while plans are afoot to reach a profit of Rs one bln after the changes.

He said that they enjoy the largest asset base of Rs 30 bln and a deposit base of Rs 27 bln as well as 60 branches.

Yatawara said that with the opportunities in the market there is room for expansion in the core business we do, hire purchase of vehicles.

In the real estate market prices are stabilising due to the economic boom as well as low interest rates. Therefore the returns are good from new land sales projects.

He said that they still hold the largest number of blocks amounting to 4000 out of which the company has been selling 400 blocks per month.

Earlier there was stiff competition in the land market and therefore we were creating a price but now we give a fair price to the customer and within four months get a profit of 30-42 percent, said Yatawara.He said that they mainly concentrate on short and medium term lending as well as deposits.TFC has a special product named "Payen kasi" where a customer can get cash after the ownership is transferred to the company.

He said that after the issues we faced due to us being a Ceylinco Group company the company went on a 50 percent cost reduction program by amalgamating and centralizing operations which has already paid rich dividends.