Understanding the strategic value of listing on the Colombo Stock Exchange

Kanishka Munasinghe, Vice President of the Listing Division at the Colombo Stock Exchange (CSE), outlines the strategic value of listing on a stock exchange, detailing the role of the Listing Division, followed by the benefits for companies, the broader economic impact, and the essential considerations entities must assess before going public.

- Kanishka Munasinghe

What is the Role of the Listing Division at the CSE?

The Listing Division of the Colombo Stock Exchange supports both potential and existing listed companies in raising debt and equity capital through a diverse range of products. The Division's role includes the reviewing applications from prospective issuers and granting approval to those that meet the required criteria and comply with the applicable rules for listing on the CSE, whilst positioning the CSE as the most preferred platform for further capital raising by listed companies. The Listings Division also strives to grant approvals within the stipulated timelines, provided all documentation is submitted in compliance with the listing rules.

In reviewing the Initial Listing Applications of both potential and existing listed companies, the Listing division ensures that such companies have adhered to the applicable Rules of the CSE and the CSE Listing Framework, which maintain transparency and adequacy of disclosures made in offer documents (i.e. Prospectus, Introductory Document and Circular to Shareholders).

The CSE's review process also includes an in-depth analysis of the potential issuer's financial performance in the present operating history and a financial analysis conducted for a pre-defined future period. All listing applications are reviewed by a dedicated Listing Review Committee comprising several members of the CSE's senior management, who are responsible for granting approval for listings.

Overall, the entire review process carried out by the CSE ensures that the potential issuer conducts the IPO, and the existing issuers carry out further issues of securities in line with the rules, regulations, and procedures of the CSE.

In addition to the above the Listing Division of the CSE also:

Advises listed companies, potential issuers, and investment banks on the listing of securities and the application of the CSE Listing Rules/Listing Framework.