IFC invests in Sunshine Holdings despite ongoing disruptions

Consumers in Sri Lanka are set to benefit from a new $5 million investment by IFC to Sunshine Consumer Lanka Ltd, a subsidiary of Sunshine Holdings PLC (Group), with a greater number of food products on offer and moves to adopt international food safety standards.

The move marks IFC’s first local currency investment in Sri Lanka’s consumer goods sector and will allow Sunshine Consumer Lanka Ltd to diversify its fast-moving consumer goods (FMCG) portfolio by expanding its operations from branded tea to confectionery, including healthy snacks.

This new investment, amid the economic disruptions caused by the pandemic, will support the domestic confectionery supply chain and help strengthen the overall competitiveness of the country’s FMCG sector.

“IFC’s partnership will allow us grow further through diversification of our businesses and acquisition of a company to expand our presence in the retail sector,” said Vish Govindasamy, Group Managing Director of Sunshine Holdings PLC. “We also plan to use this opportunity to improve product quality for consumers of confectionery, while increasing revenues and overall efficiencies for the Group’s distributors.”

In Sri Lanka, most rural consumers have access only to small grocers and informal markets with limited access to consumer markets. With the urban population accounting for only about 19 percent of the national total—and the consumer demand shifting toward branded and quality packaged food products—increasing market inclusion will be key to enhancing the sector’s competitiveness. Domestic spending on FMCG is estimated by Euromonitor at $5.5 billion, out of which modern retailers represent only around 15 percent.