News & market updates

Swiss-based Geogas Trading will deliver the first LPG shipment to Sri Lanka on Jan 5 after winning a contract to supply 380,000 tonnes (±20%) to state-owned Litro Gas in 2026; the government says there will be no LPG shortage.

Sri Lanka forecasts GDP growth of more than 5% in 2026, driven by post-Cyclone Ditwah reconstruction and planned capital spending. The government cited incoming donor/IMF support and said a $3.4bn Sinopec refinery deal is near finalisation to help spur investment.

Evolution Auto launched the Riddara RD6 Active, marketed as Sri Lanka’s most affordable all-electric double-cab with up to 373 km range, unveiled at the BMICH Motor Show. The model offers SUV-like comfort, fast charging, advanced safety and infotainment features plus dedicated after-sales support in Peliyagoda.

Colombo market recovered as the ASPI rose 0.17% (38.48 pts) to 22,333.25 and the S&P SL20 gained 0.31% to 6,071.12. Turnover was Rs 2.85bn on ~77.2m shares with foreign net outflows of Rs 42.8m; top contributors included DOCK, COMB, SAMP, MELS and DFCC.

ADB upgraded Sri Lanka’s GDP growth forecasts for 2025–26, citing robust private-sector credit growth, stronger industry and services performance, and planned infrastructure investment. The report flagged Cyclone Ditwah risks and revised inflation forecasts downward.

Colombo market rose for a fourth straight session: ASPI +0.16% (36.85 pts) to 22,459.28 and S&P SL20 +0.18% (11.09 pts) to 6,095.15. Turnover was Rs.5.55bn, foreigners were net sellers of Rs.150.5m, and top ASPI contributors were DOCK, CINS, CFIN, HHL and SUN.

Fitch Ratings says the global shipping outlook for 2026 is deteriorating due to geopolitical and policy risks, weaker GDP growth and a possible resumption of Red Sea transits that could reduce tonne-mile demand. Fitch expects container shipping profits to weaken in 2026 while crude tankers should perform better.

TotalEnergies Marketing India has partnered with Energy Core Lanka to introduce TotalEnergies' range of automotive, industrial and specialized lubricants to the Sri Lankan market, aiming to supply OEM-backed lubricant solutions for mobility and industry.

CBSL Governor Dr. P. Nandalal Weerasinghe said post-Ditwah reconstruction must not derail reform momentum and that monetary, fiscal and external stability will be maintained. He warned of only a brief inflation uptick and limited balance-of-payments impact, and urged trade, labour and productivity reforms (including RCEP linkage).

The Cabinet awarded the 2026 LPG supply contract to Swiss-based Geogas Trading S.A. to deliver 380,000 metric tons (±20%) of LPG starting January 2026 after a competitive international tender run by Litro Gas Lanka.

Litro Gas Lanka awarded a 12-month LPG supply contract to Swiss-based Geo Gas Trading SA for 380,000 tonnes ±20%, starting January 2026; Geo Gas sources most supplies from the United States and won the international competitive bid.

Cyclone Ditwah has killed 366 people, left 367 missing and affected 1,151,776 individuals across 25 districts, the Disaster Management Centre reported. More than 316,000 families are impacted, 218,526 people are displaced in 1,564 safety centres, with shortages of clean water, medical care and fuel and damaged access routes.

Access to Gampola and Kandy has been restored after Cyclone Ditwah; relief teams and the military are working to restore electricity (expected by evening) and water (within three days) while roads remain partially blocked and fuel supplies are being sent.

MarketsandMarkets projects the electric 3-wheeler market to grow from USD 2.68bn in 2025 to USD 3.85bn by 2032 (CAGR 5.3%) and names Sri Lanka the fastest-growing country in Asia Pacific for the segment. The report cites lower operating costs, higher fuel prices, battery advances, subsidies and notes local makers SL Mobility and Ideal Motors.

Sri Lanka expects an Indian joint working team to progress a Trincomalee tank farm and pipeline project that will include 14 tanks for Lanka IOC (LIOC.N0000). Another 61 tanks are in a CPC–Indian Oil JV, CPC owns 24, and cabinet approval and procurement for the pipeline are underway.

Sri Lanka's rupee closed at 307.80/95 to the US dollar on Friday, depreciating over the week from 306.90/307.20 last Friday while government bond yields were broadly steady (e.g., 15.12.2026 at 8.15-8.25%, 15.03.2028 at 9.00-9.05%). It has fallen from 292.58 in Dec 2024 despite record current-account surpluses and a sharply reduced budget deficit.

Sri Lanka's rupee opened at 307.90/308.00 to the US dollar, sharply weaker than 305.50/306.00 a week earlier. Bond yields were broadly steady and the CSE opened lower (ASPI down 0.15%), with analysts citing central bank buy-sell swaps, import dynamics and flexible exchange-rate policy as drivers of the depreciation.

Sri Lanka received 20 expressions of interest to build a 100,000 bpd BOT refinery at Sapugaskanda; EoI evaluation is in its final stages and RFPs will be issued under the government procurement system. Land acquisition requires about Rs 785m (Rs 510m advanced) and $600,000 was spent on a feasibility study.

SriLankan Airlines group posted a group net loss of Rs12.6bn up to August 2025, versus Rs4.2bn a year earlier, driven mainly by Rs8.5bn in forex losses as the rupee depreciated. The Finance Ministry said the Cabinet approved restructuring to convert or defer selected local government and state-bank loans to ease liquidity.

Sri Lanka's rupee opened at 308.20/40 to the US dollar, slightly stronger than 308.25/75 the previous day, while government bond yields were broadly steady (e.g., the 15.09.2029 bond quoted at about 9.45–9.47%).

National Water Supply and Drainage Board posted H1 2025 net profit of 17.7 billion rupees, up 28%, as pumping costs fell after an electricity tariff cut. The Ceylon Electricity Board recorded a gross loss of 11.2 billion rupees and net loss of 13.2 billion rupees; the Treasury injected 23.5 billion rupees into NWSDB.

Ceylon Electricity Board posted a 85% drop in September-quarter profit to 3.5 billion rupees, with revenues down 2% and cost of sales up 12%. A 20% tariff cut in January and denied tariff hikes have driven a nine-month loss of 9.5 billion and accumulated losses to 413 billion rupees.

China offered to help Sri Lanka diversify foreign-exchange reserves and expand renminbi (RMB) settlements to reduce dollar-related exchange-rate risks. Officials said wider RMB use, digitalisation and talks with Chinese firms including Sinopec could cut costs and attract investment.

JB Securities analysis of vehicle registry data shows several high-end cars were registered in Sri Lanka in October 2025, including 4 Bentleys, 2 Porsche Caymans, 1 Porsche Carrera, 1 Macan and 1 Lamborghini Urus. The analysis also reports 28 new and 54 used Mercedes-Benz units, 37 Audis, 15 Lexuses and 17 BMWs, and notes high-end petrol cars continue to generate tax revenue.

Cabinet approved construction of new and replacement fuel storage tanks at Kolonnawa and Muthurajawela to enable the Ceylon Petroleum Storage Terminal Company (CPSTL) to maintain a minimum 45-day petroleum stock, financed from CPSTL's own funds.

President Anura Kumara Dissanayake's 2026 budget frames IMF-linked reforms to stabilise recovery, citing 4.8% growth in H1 2025 and reserves above $6bn while aiming to bring debt below 90% of GDP by 2032. It advances FDI-friendly rules, PPPs, SOE reform, tariff liberalisation and a $15bn digital push, keeps cost-reflective energy pricing and VAT changes, and includes measures that could hurt plantations and small businesses.

Government will settle Treasury guarantees and letters of comfort for defaulted SOE loans during 2026, covering about 554 billion rupees of state-bank loans guaranteed to SOEs. The bulk of guarantees went to the Road Development Authority, SriLankan Airlines, Ceylon Electricity Board and Ceylon Petroleum Corporation; the budget gave no payment breakdown or method.

The Joint Apparel Association Forum welcomed the 2026 Budget's export-led focus, investment facilitation and digitalisation measures but urged clarity and consistent implementation to translate commitments into results. JAAF highlighted priorities including RAMIS 3.0, e-invoicing, stable energy costs, renewable adoption and improved logistics.

JAAF welcomed the 2026 Budget’s emphasis on export-led growth, digitalisation, trade facilitation and enhanced capital allowances, but urged clarity, consistent implementation and policy continuity to ensure these measures translate into tangible benefits for the apparel export sector.

Ceylon Petroleum Corporation's net profit fell 17.9% to Rs. 17.0 billion in 1H2025 as turnover dropped 19.3% to Rs. 439.5 billion, driven by lower global oil prices and a stronger rupee. CPC also cut dues to Iran to $130.96m by end-June via ongoing tea-for-oil settlements.