Lanka Rating Maintains Debt Instrument Rating of First Capital Holdings - LKR 2.5Bn - Commercial Papers

Lanka Rating considers both the consolidated and standalone profiles of First Capital Holdings PLC (FCH or “the Company”) in assessing its market position and operating performance. The assigned rating reflects the Company’s ability to maintain its strong relative standing as the holding company of the First Capital Group within Sri Lanka’s financial services industry. FCH sustained its profitability and performance metrics during the year, albeit some moderation, supported by its diversified financial services operations and the continued contribution of its key subsidiaries. FCH’s recorder net profit of LKR~3.1bn in 9MFY26 compared to LKR~4.3bn in 9MFY25. The Group’s profitability stood at LKR~3.3bn during 9MFY26 (9MFY25: LKR~4.5bn). On a consolidated basis, the Company reported a total asset and equity base of LKR~88.2bn and LKR~9.8bn, respectively, in 9MFY26.

First Capital Treasuries PLC (FCT), the Group’s prominent subsidiary engaged in primary dealer activities, remains the majority contributor to FCH’s business profile. The performance of primary dealers is expected to normalize as interest rates stabilize and are expected to increase given current operating environment. However, the performance mix of subsidiaries has become diversified, with First Capital Limited emerging as a key contributor during 9MFY26, supported by the dealing securities division. This has increased the Group's exposure to equity market. The Group recorded trading gains on equity investments during the period. The wealth management and stockbroking divisions also reported profits during the period, further supporting the Group’s overall performance. The rating also takes into account a slight improvement in the asset quality of the Company's investment portfolio, supported by better credit profiles of certain core investments, including Janashakthi Insurance, during the period.

FCH maintains a diversified funding base across debentures, commercial papers, and bank borrowings. The Company's maintains and leveraged capital structure with leveraging increasing to ~63.7% in 9MFY26 (FY25: ~57.4%). The Company was also able to contain its exposure to related-party receivables during the period. The listing of parent company (Janashakthi Limited) is expected to reduce group funding requirements to an extent.
The rating is dependent on the Company's ability to maintain its strong market position and performance in the evolving macroeconomic environment. Sound financial discipline, including strong capitalization, managed leverage, controlled related-party exposure, and sustained debt repayment capacity, remains imperative. Continued strong performance of subsidiaries, particularly FCT, will be a critical rating factor, going forward.

About the Entity
First Capital Holdings PLC (FCH or the Company) is a public limited liability company incorporated on 23 March 1992 under the provisions of the Companies Act No. 17 of 1982 and re-registered under the Companies Act No. 07 of 2007. FCH’s effective equity stake of ~77.79% is held by Janashakthi Limited as of 31 December 2025. The Company’s principal activity comprises investment and management of subsidiaries. FCH’s integrated business platform comprises four specialized areas in Government Securities, Corporate Finance Advisory and Corporate Securities Dealings, Asset Management, and Stock Brokering.

About the Instrument
FCH has LKR ~2.5bn of rated Commercial Papers outstanding, with tenures not exceeding 365 days and fixed coupon terms. Principal and interest are repaid in a single bullet payment at maturity. The Company maintains a liquidity buffer equivalent to at least 20% of CP maturities falling due within the next 30 days.