News & market updates

Overseas Realty (Ceylon) PLC signed a lease for the Embassy of France to relocate its Colombo offices to Mireka Tower, the company's Grade A office development in Colombo.

KPMG says Sri Lanka's credit rebound faces a major test after the Central Bank raised the policy rate by 100 basis points to 8.75%, a move expected to moderate private-sector credit growth. Lower fuel and vehicle imports, resilient remittances and stronger tax revenue are seen supporting a return to a current-account surplus and fiscal consolidation.

Government plans to invest Rs. 382 billion in the education sector over 2027–2031 and will prioritise greater funding for vocational education in the 2027 Budget. The 2026 education allocation was Rs.303 billion (Rs.160b general, Rs.122b higher, Rs.20b vocational); officials also noted a proposed Digital Transformation Project and school rehabilitation works.

Sri Lanka's High Commissioner and the Federation of Malaysian Sri Lankan Organisations agreed to strengthen engagement to promote tourism and investment, exploring direct Malaysia–Northern Province air links and projects including hotels, golf, leisure and theme-park developments.

The government advanced energy infrastructure ahead of Budget 2027, ordering Delft, Analaitivu and Nainativu to be developed as Green Energy Islands and reviewing 14 petroleum projects including eight new storage tanks at Kolonnawa and Muthurajawela. Major grid works reviewed include a second 220 kV underground cable to Colombo, multiple transmission projects, a STATCOM at Padukka, rooftop solar integration, and the planned resumption of JICA-backed projects with 2027 funding.

Arcasia Investment & Trading Ltd and ATX Partners agreed to acquire a 50.16% stake in Industrial Asphalts and will make a voluntary offer of LKR0.40 per share to remaining shareholders. The consortium bought ~1.8807bn shares at LKR0.40; shares last traded at LKR0.70 and assets were LKR0.47/share (end‑March 2026).

The Wireless Intelligence and Innovation (WIIN) Institute of Technology was launched at TRACE Expert City to conduct research and industry training across telecommunications, energy, construction, FinTech and healthcare, including AI/ML programmes, in collaboration with University of Oulu and IIT Madras.

Excello Developers launched Aathavan, a 44-unit, eight-storey residential project in Dehiwala starting at LKR 38 million, featuring full solar power, water recycling, low maintenance fees and flexible bank-backed payment plans.

Businessman Nahil Wijesuriya donated Rs.100 million toward the Nalanda Sports Arena as part of the school's Centenary Project.

Port City Colombo, a $15 billion SEZ, is placing India at the centre of its growth plan and aims to double annual Indian tourist arrivals to about 1.2 million by 2030. The development will add new attractions, convention facilities, duty-free retail and target Indian IT/GCCs as business tenants.

Treasury has authorised government institutions to reprice or extend eligible public procurement contracts to reflect higher fuel, freight and material costs, with measures applied retrospectively and effective until 30 September 2026. The Circular targets construction works (using CIDA price-adjustment formulas) and permits use of PPIs, freight/shipping indices or documented cost evidence for other procurements.

NovaNest Properties launched Rainbow Apartments in Ratmalana, a new residential development with multiple amenities and a full-time medical centre backed by Nawaloka Hospitals PLC, including a 24-hour ambulance service.

LANKATILES announced a strategic partnership with the Geoffrey Bawa Trust to support the Trust's DesignTalk platform, the Annual Geoffrey Bawa Memorial Lecture and other architecture knowledge-sharing initiatives.

Lanka Tiles is supporting the 23rd Annual Geoffrey Bawa Memorial Lecture, delivered by architect Junya Ishigami, on 23 July in Colombo; admission is free but registration is required.

The National System Operator has launched an international tender for a 250 MW/1000 MWh standalone BESS, to be delivered as 25 x 10 MW/40 MWh blocks under 15-year BOO contracts; proposals are due 14 August 2026. The tender aims to improve renewable integration and support the government's 70% renewable-by-2030 and net-zero-by-2050 targets.

Government set a 2027 primary expenditure ceiling of Rs.5.064 trillion (12.9% of GDP) and projects the budget deficit will narrow to 4.5% of GDP in 2027, targeting a primary surplus of 2.6% of GDP from 2027 onwards.

Cabinet approved a €924,063 German grant to fund a program promoting energy-efficient, climate-resilient buildings in Sri Lanka, to be implemented by GIZ with the Energy Ministry and the Sustainable Energy Authority.

Toyota Lanka held a groundbreaking ceremony for its flagship showroom in Bambalapitiya, which will feature contemporary architecture, interactive vehicle displays and test drives designed by Design Consortium.

Maga Engineering Ltd. was awarded a Rs.4.99 billion contract to construct the 2.32 km Warakapola bypass and a $7.26 million (Rs.2.4 billion) contract to expand the Bandaranaike International Airport departure terminal.

Toyota Lanka held a groundbreaking ceremony for a new flagship showroom in Bambalapitiya, designed by Design Consortium; the facility will feature interactive vehicle displays, immersive experiences and test drives.

Outgoing Swedish Ambassador Jan Thesleff said he is optimistic about Sri Lanka's recovery and rising investor confidence, noting about 80 Swedish companies operate in Sri Lanka. He highlighted opportunities in ICT, apparel exports, renewable energy, healthcare and tourism, and cited Port City progress and the need for direct flights.

Cabinet approved signing a tripartite agreement to implement a programme promoting energy‑efficient, climate‑resilient buildings backed by a €924,063 German grant (~Rs314m). GIZ will implement the project with progress monitored by the Ministry of Energy and the Sustainable Energy Authority.

The National System Operator launched an international tender for a 250 MW / 1,000 MWh standalone battery energy storage system across 25 substations, with BOO contracts and proposals due 10:00 hrs on 14 Aug 2026.

The National System Operator (Ministry of Energy) has launched an international tender for a 250 MW / 1000 MWh standalone battery energy storage system, structured as 10 MW/40 MWh units across 25 substations. The BOO project carries 15‑year storage agreements; proposals due Aug 14 (RFP until Aug 13).

Alpha Fire Services PLC will acquire 100% of Icon Engineering for Rs. 260 million via a share swap issuing 9,122,807 new Alpha Fire shares; the combined operations are expected to generate over Rs. 1 billion in revenue and raise profitability by 30%. The transaction is a related-party major transaction and is subject to CSE and shareholder approvals.

President Anura Kumara Dissanayake chaired a pre-Budget review of 2026 projects and discussed 2027 Budget proposals for the Ministry of Industry and Entrepreneurship Development, stressing completion of projects and development of industrial zones (Dambulla, Ingiriya, Valachchenai, Millaniya, Katunayake). He also urged consolidation of state enterprises, proposed an Entrepreneurship and Industry Transformation Authority and requested proposals for concessions to support exporters and industriali

The Ceylon Chamber hosted a B2B session (8–10 July 2026) for a 31-member FIEO Indian export delegation to connect Indian SMEs (pharmaceuticals, engineering, apparel, food, infrastructure) with Sri Lankan companies to explore sourcing, market expansion and commercial partnerships.

Alpha Fire Services (AFS.N0000) will acquire Icon Engineering for Rs260 million in a share-swap, issuing 9,122,807 new shares valued at Rs28.50 each. The deal gives new investors a 19.38% stake, expands MEP/HVAC operations into the Maldives and is expected to boost group profitability ~30% and bring USD inflows.

Hikvision Sri Lanka held the Shaping Intelligence – Smart Building Summit 2026, showcasing AIoT building-management and security solutions and recording 157 participants.