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Natasha
Natasha
Apr 25 2026
72Sri Lanka’s Janashakthi has issued a market announcement, after being asked by the Colombo Stock Exchange, addressing criticisms on the share allotment following its recently concluded initial public offering.
JXG’s IPO was subject to criticism over 243 million shares out of 500 million being preferentially allotted to strategic investors.
Market participants called the move an ‘initial public placement’ and said it damaged investor confidence in the market as the allotment basis was not disclosed in the prospectus.
“When approval was sought for the IPO in or around early February 2026, market sentiment was hugely positive, as reflected by the level of transactions and volumes on the share market at the time,” Janashakthi said in its market filing.
“However, following finalization of the IPO, there was a drastic shift in market sentiment due to the ongoing events in Middle East, leading to grave concerns on the eventual success of the IPO.
“In the circumstances, the Company was compelled to proactively premarket the issue, particularly with local and foreign investors.
“These investors agreed to make firm commitments to apply for substantial subscriptions provided that they had reasonable assurances of receiving allocations based on their precommitments.”
Janashakthi said it took reasonable measures within the CSE’s listing rules to make such commitments based on practical considerations.
JANASHAKTHI LIMITED – INITIAL PUBLIC OFFER 2026 – RESPONSE TO CONCERNS REGARDING BASIS OF ALLOTMENT TO NON-RETAIL INVESTORS
Further to a request made to us by the Colombo Stock Exchange to make a market announcement to address the criticisms made about the basis of allotment of shares to “non-retail investors” by the Company following the conclusion of the recent IPO, we wish to state as follows:
The Janashakthi IPO was the largest IPO on the Colombo Stock Exchange in the previous 14 years, amounting to over Five Billion Rupees. The Company was therefore aware of the importance of
ensuring its success, not only for its own benefit but also from broader public sentiments of the market.
When approval was sought for the IPO in or around early February 2026, market sentiment was hugely positive, as reflected by the level of transactions and volumes on the share market at the time.
However, following finalization of the IPO, there was a drastic shift in market sentiment due to the ongoing events in Middle East, leading to grave concerns on the eventual success of the IPO.
In the circumstances, the Company was compelled to proactively premarket the issue, particularly with local and foreign investors. These investors agreed to make firm commitments to apply for substantial subscriptions provided that they had reasonable assurances of receiving allocations based on their precommitments.
Since the Company had a responsibility to take all reasonable measures within the Listing Rules of the Colombo Stock Exchange to ensure the eventual success of the IPO, it made such commitments based on practical considerations. The preferential allotments within the nonretail category is based on the above criteria.
Source: Economy Next
