Tourism Fund to cash in on sector boom
Ramani Kangaraarachchi
The tourism and banking sectors will outperform the rest in the
Colombo stock market this year. The first ever Ceylon Tourism Fund of
Ceylon Asset Management (CAM) will enable Sri Lankans to cash in on the
tourism boom to explore emerging opportunities, (CAM) Managing Director
Dulindra Fernando told Daily News Business.
He said the tourism and banking sectors will outperform the market in
2011 and this will be the turnaround year for Sri Lanka from being a
developing economy to an emerging economy.
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Dulindra Fernando |
The country has already joined the high growth club in the Asian
region and as a result the Colombo Stock Exchange (CSE) will again be a
top performer in the region,” he said.
Fernando said the tourism sector is at the beginning of a long growth
curve but the number of hotel rooms is very small as 14,500 could cater
to less than 600,000 tourists per annum. “Therefore the prices of rooms
are likely to increase. This is because the country has utilised only
two provinces namely Western and Southern. Seven other provinces are yet
to be utilized,” he said.
He said the Ceylon Tourism Fund (CTF) of CAM covers around 55 percent
of the sector market capitalization and over 80 percent of the five star
rooms in Sri Lanka.
The total Unit Trust Industry investors as at December 31, 2010 was
only 24,600 and CTF investors in four months stands at 450 which is a
very positive outcome.
The company focuses on small investors with a minimum of Rs 10,000 to
enjoy higher returns that are available in the CSE.
He said Sri Lanka has brought tight credit control on stock brokers
in October and the market is coming down towards good credit. Therefore
Sri Lanka is not a high risk market anymore and it has matured over the
last two years.
Elaborating on the opportunities Fernando said the demand for Sri
Lanka is growing rapidly in two segments.
The Asian traveller is a new market consisting high end Indians and
Arabs. The other one is the Western traveller seeking beautiful beaches.
Therefore CAM expects to bring the opportunity to the mass market.
The CAM will approach Tamil and Sinhala speaking masses towards their
objective and the challenge is making awareness among them which is very
low. |
