Sri Lanka’s Janashakthi has released an announcement in response to inquiries from the Colombo Stock Exchange, addressing criticisms regarding the allocation of shares following its recent initial public offering (IPO).
The IPO of Janashakthi faced scrutiny as 243 million out of 500 million shares were allocated preferentially to strategic investors. This led market participants to label the offering as an “initial public placement,” raising concerns about the lack of transparency in the allotment criteria as outlined in the prospectus.
In its statement, Janashakthi noted that when it sought approval for the IPO around early February 2026, market conditions were favorable, with high transaction volumes indicative of positive investor sentiment. However, the situation changed significantly after the IPO was finalized, largely due to ongoing geopolitical events in the Middle East, which sparked serious doubts about the IPO’s success.
Faced with this shift in sentiment, Janashakthi felt it necessary to engage in proactive marketing of the offering, particularly targeting both local and international investors. These investors were willing to make substantial commitments to apply for shares, contingent upon receiving reasonable assurances regarding their allocations based on these commitments.
Janashakthi emphasized that it adhered to all applicable regulations set forth by the Colombo Stock Exchange (CSE) while making these commitments, and the preferential allocations for non-retail investors were made based on practical considerations.
The complete announcement is as follows:
JANASHAKTHI LIMITED – INITIAL PUBLIC OFFER 2026 – RESPONSE TO CONCERNS REGARDING BASIS OF ALLOTMENT TO NON-RETAIL INVESTORS
In light of the request from the Colombo Stock Exchange for clarification concerning the share allotment process for “non-retail investors” following our recent IPO, we wish to provide the following information:
The Janashakthi IPO was the largest offering on the Colombo Stock Exchange in the past 14 years, exceeding Five Billion Rupees. The Company recognized the significance of ensuring its successful launch, not only for its own interests but also considering the broader market sentiment.
Initially, in early February 2026, there was a strong positive market atmosphere, as evidenced by high transaction volumes. However, after the IPO’s finalization, a notable shift occurred due to escalating issues in the Middle East, creating serious apprehensions regarding the IPO’s potential success.
In light of these developments, the Company proactively engaged in pre-marketing efforts with both local and foreign investors, who expressed willingness to make considerable subscriptions, contingent upon receiving assurances of their allocations.
Given its responsibility to take all feasible steps within the CSE’s Listing Rules to ensure the IPO’s success, Janashakthi executed these commitments based on practical considerations, leading to the preferential allotments within the non-retail category.
(Colombo/April 25/2026)