Colombo 17 August 2020: First Capital Holdings PLC (the Group) the only listed investment institution in Sri Lanka, continued its growth momentum into the first quarter of 2020 (Q1 2020) recording a Profit after Tax of LKR 1.46Bn for the quarter ended 30th June 2020, compared to Rs. 581.96Mn in the corresponding period of the previous year.
The results are reported on the back of a robust performance for year 2019/20, where the Group posted a Consolidated Profit after Tax of LKR 1.07Bn for the year. First Capital, with an impressive history of over 35 years, currently has total assets of LKR 32.5Bn and Equity of LKR 4.9Bn.
“Reflecting on the past 3 months, what stands out most is the Group’s record-breaking performance, making it without a doubt, the best year to date”, commented Chairman, First Capital Holdings PLC, Nishan Fernando.
The Group’s Primary Dealer operations were positively impacted by the CBSL’s efforts to revive the economy through monetary policy easing measures to counter the COVID-19 pandemic impact, with the business reporting a Profit after Tax of LKR 1.36Bn for the quarter (2019/20 – LKR 562Mn).
The Corporate Finance division too recorded notable results, mobilising LKR 3Bn for its clients through structuring and placement of corporate debt securities, generating a fee income of LKR 25Mn for the quarter (2019/20 – LKR 31Mn).
The Wealth Management division of the Group delivered a strong performance reporting a fee income of LKR 17Mn for the quarter (2019/20 – LKR 11Mn) amidst challenges faced during the COVID-19 lockdown period. The division showed a growth in assets under management to end with LKR 27.9Bn as at 30th June 2020 (31st March 2020 – LKR 26.4Bn).
Despite the setback experienced in the first quarter of 2020, with the CSE remaining closed for 7 weeks, the Group’s Stock Brokering division recorded revenue of LKR 14Mn for the quarter (2019/20 – LKR 06Mn).
“Given that COVD-19 is still an ongoing situation, we expect the government would continue with its current accommodative monetary policy stance for the year 2020”, commented Director/Chief Executive Officer, First Capital Holdings PLC, Dilshan Wirasekara.
Colombo 12 August 2020: First Capital Holdings PLC (the Group) the only listed investment institution in Sri Lanka, recorded a Consolidated Profit after Tax of LKR 1.07Bn for the year 2019/20, amidst negative headwinds that saw Sri Lanka, reporting subpar economic growth for the third consecutive year. The results show a significant growth compared to LKR 8Mn in the previous year. First Capital, with an impressive history of over 35 years, has total assets of LKR 45.6Bn and Equity in excess of LKR 4Bn.
“Our ability to deliver impressive results even in tough times, is a testament to the Group’s robust operating model. I am convinced that the ongoing emphasis placed on strengthening each of our core businesses and firming up their positions within their immediate operating domain, has been a critical success factor for the Group”, commented Chairman, First Capital Holdings PLC, Nishan Fernando.
The Group’s Primary Dealer contributed LKR 1.2Bn (2018/19 – LKR 96Mn) Profit after Tax for the year, claiming a substantial volume-based market share in both the primary auctions as well as in the secondary market during the financial year.
Capitalising on the potential in the listed and unlisted debt market, the Corporate Finance division mobilised LKR 42Bn for its clients through structuring and placement of corporate debt securities, generating a fee income of LKR 175Mn (2018/19 – LKR 69Mn).
The Wealth Management division of the Group, made remarkable progress to deliver its best financial results to date, reporting a fee income of LKR 64Mn (2018/19 – LKR 33Mn). The division showed a significant growth in its assets under management to end with LKR 26.4Bn as at 31st March 2020 (31st March 2019 – LKR 5.9Bn).
Furthermore, the Company’s benchmark unit trust, the First Capital Money Market Fund was the best-performing unit trust fund in the country in 2019/20.
The Group’s Stock Brokering unit also recorded revenue of LKR 71Mn for the year 2019/20 (2018/19 – LKR 53Mn).
“While the last 12 months have been challenging for many local businesses, several aspects of our immediate operating environment worked in our favour; we are looking ahead and focusing our efforts on improving efficiency across all businesses to deliver enhanced results to our valued stakeholders’, commented Director/Chief Executive Officer, First Capital Holdings PLC, Dilshan Wirasekara.
The Group’s [SL]A- credit rating was reaffirmed by ICRA Lanka Limited, reconfirming the stability of the Group.
First Capital Holdings PLC paid a total dividend of LKR 9 per share for 2019/20 totaling to LKR 911Mn.
First Capital Money Market Fund is an open-ended fund that invests in corporate debt and government securities which mature within one year.
The fund is a good substitute for savings accounts and short term fixed deposits. The fund gives higher tax-free returns on your investment with the flexibility of withdrawing your investment at any time.
The Unit Trusts Funds are managed by First Capital Asset Management Limited a subsidiary of First Capital Holdings PLC, a full service investment bank rated A- and listed on the Colombo Stock Exchange.
First Capital Asset Management Limited is regulated by the Securities and Exchange Commission of Sri Lanka, while the Bank of Ceylon acts as the trustee and custodian of the funds.
First Capital Holdings PLC is a full-service investment bank with a 30-year history, which offers an array of investment solutions to its clients including services in capital markets advisory, fixed income, equities and wealth management.
The company’s wealth management suite serves individual and institutional investors through unit trusts, financial planning and discretionary portfolio management.
Currently, the company is focusing on promoting its unit trust products to the market, which offers a low-risk investment option. Unit trusts are well suited for both corporates and individuals, as it allows for capital to be invested and managed professionally. The unit trusts funds act as a pooling vehicle in which funds from multiple investors are accumulated, allowing for larger investment in certain instruments with negotiated terms.
First Capital unit trusts products cater to a large base of high-net-worth and institutional clientele including SME and mid-level corporates.
The funds are managed by professional fund managers, who ensure that risks are diversified over a multitude of assets, while the largest state bank, the Bank of Ceylon acts as an independent trustee. Investors are given further peace of mind through the stringent monitoring and regulatory control of the unit trust industry by the Securities Exchange Commission (SEC).
Globally, the unit trust sector asset base exceeds that of the banking sector. According to the Central Bank of Sri Lanka the bank deposits at LKR 4.7 trillion as at year end 2014, is leaps ahead of industry assets under management LKR 133 billion. Considering the tax exemptions given to unit trusts investments and that retail investors are seeking higher-yield alternative investments away from conventional bank-deposits, the company sees potential for growth in this segment.
Striving to excel in its customer centricity, First Capital encourages potential investors to consider their risk appetite, objectives, and purpose for investing prior to getting involved, ensuring that customers choose the most fitting investment option. “We profile the client, looking at age, responsibilities and commitments, and help them understand what sort of risk they should be taking, to fulfil their goals in life,” explains CEO, Dilshan Wirasekara. The company conducts financial planning on behalf of its clients to help them assess where they stand in relation to achieving their goals.
First Capital has a range of unit trust products targeting varying investor requirements. For the passive investor, it provides a gilt-edged fund, which invests purely in government securities, while providing a money-market fund for moderate risk-takers giving a return of 7-8% per annum, giving a higher rate than short-term bank deposits. For the more aggressive risk-takers who want high returns, the company offers an equity fund, maintained on ethical grounds.
The company’s flagship unit trust fund – First Capital Wealth Fund was the best-performing fund in its category in 2013 and 2014, and has outperformed the unit trust industry in terms of Annual Equivalent Rate (AER) for the five years ended December 2015.
First Capital even offers customised portfolio management for investors with larger funds, and provides investment advice covering many business sectors.
Wirasekara comments: “The Company differentiates itself by the ability to navigate varying market cycles in multiple asset classes. Its superior performance in unit trust is a result of the ability to identify advantageous trends coupled with exemplary risk management.”
First Capital’s asset management business is only one aspect of its total offering. “We are a fully-fledged investment bank, having many other business lines,” avers Wirasekara adding that “being a primary dealer, we have insights into the bond market and interest-rate direction.” As testimony, First Capital claims to have been the largest manager of debt issuance in the market last year, raising LKR 25 billion of debt.
The company enjoys an unparalleled advantage with its research-backed market insights and expertise, which enables its fund managers to make notable capital gains by capitalising on movement, through risk mitigation and locking-in long-term rates at high yields.
First Capital has extended its local footprint through branches in Colombo, Kandy, Matara and Kurunegala. The company is geared for its journey towards growth in unit trust investments and customer-centric wealth management.
Published in May 2016 on the LMD Magazine – Digest Segment on Wealth Management
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FIRST CAPITAL MONEY MARKET FUND (FCMMF)
Products and Services –
This unit trust fund acts as a pooling vehicle in which contributions from multiple investors are accumulated and invested in fixed-income investments such as government securities, commercial paper, structured debt instruments, and even bank and finance company fixed deposits that mature within one year.
The income earned from these investments are shared by the respective unit holders in proportion to the number of units owned.
Features and Benefits –
With its moderate risk level and high liquidity, the First Capital Money Market Fund is a good substitute for savings accounts as your investment can be withdrawn at short notice.
REGULATED AND ENTRUSTED
Our fund management activities are dully regulated by the Securities and Exchange Commission of Sri Lanka (SEC) while Bank of Ceylon (BoC) acts as the trustee and custodian for our funds.
In its efforts to facilitate knowledge-sharing about the investment market and encourage investor awareness, First Capital Holdings PLC held a special presentation on Unit Trust Investments, at the Management Club Professional Development Program last week. Here First Capital Holdings PLC Manager – Business Development and Corporate Planning Kosala Liyanagedara addressing the audience. The presentation encompassed various aspects of Unit Trust Investments and trends in the financial market.