FIRST ASIA SECURITIES
PakistanSri LankaPREV
EquitiesFixed Income
DATA AS OF 20 JUN 2026 · EOD

SLTL

Sri Lanka Telecom
TELECOM

LAST · LKR

86.08
−0.65 ▼ −0.75%
P/E 14.0× · YIELD 0.9% · ROE 11.2%

52W RANGE

81.71108.83
16% OF RANGE · YTD −10.6%
01 / SLTL — 1 YearAS OF 20 JUN 2026 · EOD
PERIOD 1Y · 250 SESSIONS▼
The Call
NEUTRAL+7%
92.00LKR · 12-MO
14× FY26E

Steady growth; optionality embedded.

Risks to our view
02 /

FAS DESK · FIRST ASIA SECURITIES RESEARCH · 23 JUN 2026 · EOD

Privatisation optionality against a structural drag

  1. 01

    Neutral, LKR 92 target: SLTL trades at 14× with a sub-1% yield and an 11% ROE — fairly valued, with the call hinging on the long-mooted privatisation.

  2. 02

    The fixed-line legacy is a structural drag; mobile and broadband growth only partly offset it.

  3. 03

    State ownership and a thin yield limit the appeal absent a stake sale.

  4. 04

    At ~14× FY26E our LKR 92 target is modest; the optionality is real but unpredictable.

Where we differ from the street
Street viewOur viewWe change our mind if
An IMF-linked stake sale re-rates it.It is the key upside, but timing is uncertain and politically fraught — not a base case.A concrete, signed divestment process.
Broadband saves the story.It cushions, but does not fully offset the legacy drag.Broadband growth clearly outrunning fixed-line erosion.
14× is high for an 11% ROE state telco.Fair, with privatisation optionality embedded; without it, full.A de-rating as the privatisation premium fades.

— FIRST ASIA SECURITIES RESEARCH · NOT INVESTMENT ADVICE