Sri Lanka’s Lankem to invest Rs. 2.5 billion to put up fertiliser plant
Daily FT: Lankem Ceylon PLC has embarked on establishing a fertiliser plant in Oyamaduwa in the Anuradhapura district with an investment of Rs. 2.5 billion.
A fully owned subsidiary Lankem Minerals Ltd. has been incorporated to carry out the new venture.
Lankem said the primary objective of this operation is to cater to the agricultural requirement of the non-perennial crops. The sales and distribution of the fertiliser will be carried out by Lankem Ceylon PLC and its fully owned subsidiary SunAgro LifeScience Ltd., through the companies’ existing distributor network.
Commercial operations are expected to commence by the end of the year, said Lankem in a disclosure to the Colombo Stock Exchange.
In FY23 Lankem Group’s Agro Division has successfully turned challenges into opportunities by expanding its product range to include specialty fertilisers, seeds, and yield boosters. As a result, the Division has flourished, achieving a remarkable 105% increase in turnover compared to the previous financial year of 2021/22. Additionally, the Division has demonstrated commendable financial performance, with the divisional profit exceeding the previous year by almost three-fold. Through strategic diversification, Agro has not only overcome obstacles but also capitalised on emerging market trends. By offering a wider range of specialised products, the Company has positioned itself as a leader in the agricultural industry.
OSL take:
Sri Lanka’s private sector has shown its resilience and strength even amidst challenging economic conditions and is once again on a growth path while engaging in expansion programmes. The ongoing economic activities in the country have resulted in an overall expansion of the economy as the country works towards becoming a regional hub. One of the key economic sectors that have shown an expansion in business/investment opportunities is the agriculture sector. The growth in demand in the agriculture industry for crops for consumption as well as exports have seen a steady growth resulting in an increase in opportunities for business/investment for both foreign and local businesses. It is in such a backdrop that Sri Lanka’s private sector businesses are also looking at investing in the expanding business/investment opportunities in the agriculture industry. The investment of a local private sector business in setting up a fertiliser plant is indicative of the growing business potential in the country’s agriculture industry. Foreign businesses/investors could therefore confidently explore the expanding business/investment opportunities in Sri Lanka’s agriculture industry utilizing the many incentive schemes presented by Sri Lanka to foreign investors. Foreign businesses could also look at forming collaborations with local businesses with the aim of expanding the export crop cultivation sector to engage in exports using Sri Lanka’s strong trade ties.