Symposia & Conferences
Permanent URI for this communityhttp://repository.kln.ac.lk/handle/123456789/10216
Browse
7 results
Search Results
Item Investigating the Impact of Economic Shocks on the Renewable Energy Industry Growth in Sri Lanka: A Cointegration Approach Using the ARDL Model(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Fernando, H. D. T.; Gunasekara, A. L.Introduction: Sri Lanka is a country that faced many adverse situations such as the tsunami in 2004, the civil war, covid pandemic, the Easter Sunday bombing and the economic crisis. Thus, it is important to study how these changes in economic variables impact economic activities of the country. The renewable energy industry, which is an industry with immense potential and high volatility is the center of economic activity and sustainability. Therefore, this study aims to investigate the impact that macroeconomic shocks have on the renewable energy industry returns in Sri Lanka. Methodology: This study collected data for 5 firms in the renewable energy industry listed on the Colombo Stock Exchange for a sample period of 10 years, from 2014 to 2024. Using a quantitative approach, this study collected secondary data from CapIQ. The Colombo Consumer Price Index (CCPI), Average Weighted Lending Rate (AWLR), and Industrial Production Index (IPI) were taken as the explanatory variables to reflect economic variables and were obtained from the CBSL publications. These three variables were used to investigate the long-run and short-run relationship between the variables. The Autoregressive Distributed Lag model (ARDL) was used in this study to analyze the short-run and long-run relationship between the variables. Findings: The results of the study revealed that the average weighted lending rate has a negative and statistically significant impact on the renewable energy returns in the long-run, and in the short run the Industrial Production Index has a positive and statistically significant impact on the renewable energy returns, and in the short run the AWLR has a negative and statistically significant impact on the renewable energy returns in Sri Lanka. Conclusion: The findings of the study can be used by industrial experts to plan ahead and mitigate risk relating to economic shocks caused by changes in macroeconomic variables and by policy makers to set policies conducive to the growth of the renewable energy sector for sustainable development of the economy.Item The Impact of Financial Leverage and Working Capital Management on Financial Performance: An Analysis Before and During the Economic Crisis: Evidence from Listed Companies in The Food, Beverage, and Tobacco Industries of Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Wijesingha, R. M. D. L.; Gunasekara, A. L.Introduction: This investigation focuses on examining whether financial leverage and working capital management impact on financial performance of companies, particularly before and during the economic crisis. Special attention is given to financial performance indicators such as Return on Assets and Return on Equity. Methodology: This study analyzes panel data covering ten companies over ten years of the Food, Beverage, and Tobacco sector. Here, the company was selected based on market capitalization. Using a quantitative approach, secondary data has been obtained from the annual reports of the selected companies for this study. The independent variables are Total Debt Ratio, Inventory Conversion Period, Average Receivable Period, Average Payable Period, and the dummy variables are Covid-19, Economic Crisis, and Full Crisis Period. Control variables are Firm Size, Sales Growth, and Asset’s Tangibility. Also, a t-test and regression were mainly used for the analysis. Findings: According to t-test results, there is no statistical difference between pre-crisis and during-crisis groups. In the regression analysis, it was found that the economic crisis and Covid-19 have impacted the financial performance of the Food, Beverage, and Tobacco sector. Conclusion: It highlights the importance of effective financial leverage and working capital management practices to enhance resilience even during economic crises. It also provides valuable guidance for managers, investors, and policymakers seeking to enhance performance during challenging periods and provides a foundation for future research on capital strategies in emerging economies during economic crises.Item The Impact of Exchange Rates on Stock Market Performance in Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Rajapaksha, R. A. R. A.; Gunasekara, A. L.Introduction: The relationship between exchange rates and stock market performance in developing economies is a topic of great interest to investors, researchers and policymakers. This paper examines the impact of exchange rates on the S&P SL20 index in Sri Lanka. This includes the exchange rate behavior of the USD, EUR, GBP, AUD and JPY against the Sri Lankan rupee. Apart from other factors in the economy, the behavior of exchange rates has made a difference in economic development and investor decisions. Therefore, the purpose of the research is to explore the relationship between exchange rates and the stock market in Sri Lanka in the short and long term. Methodology: This paper used monthly data from January 2010 to July 2024. After conducting unit root tests using ADF analysis for stationarity of all variables, the strength of association between the dependent and independent variables is measured through a correlation analysis. The ARDL model elaborates on the short- and long-run impacts, as well as using a GARCH model that captures the effect of the volatility of exchange rates on stock market returns. Descriptive statistics represent data development through the study period with the help of tables or graphs. Findings: Descriptive statistics show positive means for all variables but non-normal distributions with skewness and kurtosis. The ADF test confirmed stationarity, thus enabling further analysis. The USD has a significant negative impact, and both short- and long-run dynamics are highlighted through the ARDL model. The ARCH test does not show heterogeneity, while the GARCH model confirms volatility clusters and emphasizes the strong influence of the USD. The results emphasize that not all exchange rate movements have the same impact on the performance of the S&P SL20, and that some currencies strongly determine its performance. Conclusion: This paper highlights the relationship between exchange rates and stock market performance in Sri Lanka. Foreign exchange stability is important for market outcomes and suggests currency stabilization strategies that minimize market crashes. Investors should consider how to manage their investments against the exchange rate to maximize returns when investing in the stock market. Due to the large differences between past literature reviews and the current database and the differences in the variables considered, the current research is bound to shed new light on the short-run and long-run relationship.Item The Impact of Economic Crisis on Firm Performance: Evidence from Listed Commercial Banks in Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Prabodya, P. H. H.; Gunasekara, A. L.Introduction: This paper examines how the economic crisis impacted the listed commercial bank’s performance, focusing especially on performance indicators such as primary profitability ratios, Interest Income, and Non-Interest Income. Methodology: This investigation analyzes panel data covering ten companies over 10 years. The firm age, firm size and asset tangibility used as the control variables. Findings: According to the t-test results, there is a statistical difference between the previous and during crises groups with a significant decline in financial performance. The regression analysis showed that the financial crisis impacted the ROE most. Conclusion: The banks need to have proper risk management mechanisms during crisis periods to manage its negative impact. The future studies can use bank specific factors and macroeconomic factors as control variables to see whether the negative impact becomes significant after removing the influence of macroeconomic conditions and bank specific factors.Item The Impact of Asset Liability Management on Financial Performance Before and During the Crisis: Evidence from Licensed Finance Companies in Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Fernando, W. H. J. T.; Gunasekara, A. L.Introduction: This study critically assesses the impact of ALM on the financial performance of licensed finance companies in Sri Lanka, focusing on pre-economic crises and during the crisis periods. This research integrates measures of financial performance, which include ROE and ROA, while using capital adequacy ratio, CAR; non-performing loans ratio, NPLR; operational efficiency ratio, OER; earning diversification ratio, EDR; and liquid asset ratio and LAR, as main ALM variables to provide holistic understanding in the role of ALM in navigating through financial instability. Whereas firm size is a control variable, COVID-19 pandemic, economic crisis, and combined crises are dummy variables created to capture the temporal and contextual variations. Methodology: The research conducted on panel data collected from 22 licensed finance companies over the period from 2016 to 2023. Using a quantitative research approach, secondary data was obtained from the annual reports of the selected companies. This study applies panel regression, including random effects and robust error adjustments. Findings: The results have proved that ALM significantly impacts financial performance, with positive effects of CAR on profitability and negative pulls from both NPLR and OER, especially at more heightened levels of economic stress. Earnings diversification and liquidity were found to moderate these effects. The findings also depicted differentiated impacts of crises and the way COVID-19 heightens the challenge of deterioration in asset quality and inefficient operations. Conclusion: The study underlines that ALM is important for treading economic turmoil and for achieving the highest level of financial stability. Effective ALM strategies improve resilience, thus allowing finance companies to maintain stability and stakeholder trust during crises. This paper provides useful insights for both policymakers and practitioners on how strategic improvements in the ALM framework should be undertaken to help attain financial sustainability in volatile markets.Item Do Exchange Rate and Inflation Impact Foreign Portfolio Inflows of Colombo Stock Exchange? An Analysis under Covid-19 Pandemic(Faculty of Commerce and Management Studies, University of Kelaniya Sri Lanka, 2023) Dissanayake, D. A. S. D.; Gunasekara, A. L.The purpose of this research is to examine whether the foreign exchange rate, inflation, and COVID-19 impact Foreign Portfolio Inflows to the Colombo Stock Exchange Sri Lanka. This Study uses secondary monthly time series data from 2015 to 2022. The independent variables of this study are changes in exchange rate, change in inflation and the COVID-19 dummy variable. The dependent variable is the change in Foreign Portfolio Inflows (FPI). The VAR model and Granger-Causality test are applied to test the relationship between inflation, exchange rate, COVID-19 and FPI. The VAR model shows that COVID-19, exchange rate and inflation have a no significant impact on current change in FPI. Granger Causality Test show that there is a one-way relationship between Inflation and the current change in FPI. This study concludes that the exchange rate does not impact current change in FPI and the impact stems from inflation on FPI is weak. This study is one of the first attempts to investigate whether the exchange rate, Inflation rate, and covid-19 impact Foreign Portfolio Inflows in Sri Lanka under Covid-19. Future research is needed to examine the relationship using other variables like oil price, domestic institutional investment, GDP, etc.Item Behavioral Factors Affecting to Selection of Brokerage Firm in Colombo Stock Exchange by Retail Investors.(8th International Conference on Business & Information ICBI – 2017, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2017) Fernando, C. S. P. K.; Gunasekara, A. L.; Weerasingha, W. D. J. D.; Dasanayake, D. M. A. S. N.This study examines the behavioral factors affecting to the selection of a stockbroker by retail customers, referring to the Behavioral Finance theory. This study is driven by two main objectives, to determine the main factors affecting to the selection decision and to identify the importance levels of the behavioral influences on the individual investors when selecting a stock brokerage firm. This research has used primary data collected through a distribution of a structured questioner and as a sample 60 individual investors were chosen using random sampling technique. However, only 47 questionnaires were returned and analyzed using five-point scale method. Exploratory Factor Analysis identified five main factors as Overconfidence and Gambler’s Fallacy Factors, Anchoring and Ability Bias Factors, Market Factors, Herding Factors and Firm Image Factors. The Reliability Test revealed that there is an internal consistency of each factor. Further, the findings suggest that the Firm Image Factor and Market Factor have the highest importance level for the selection decision whereas Herding Factor has lowest importance level.