By: Staff Writer
September 24, Colombo (LNW): Hunas Holdings PLC is entering a critical phase of strategic transformation as the Colombo Stock Exchange-listed conglomerate attempts to expand its hospitality and real estate businesses while confronting declining revenue, continuing losses and tight short-term liquidity.
The company, formerly known as Hunas Falls Hotels PLC, has evolved from a standalone hotel operator into a diversified group with interests spanning renewable energy, leisure and hospitality, tea plantations and brokering, and real estate. However, its latest financial position highlights the difficult balance management must maintain between funding expansion and protecting financial stability.
According to the FY2025/26 Annual Report released in September 2026, Group revenue fell sharply to Rs.873.6 million from Rs.1.3347 billion a year earlier. The contraction was largely associated with the strategic disposal of the Rainforest Tea Factory during the previous financial period.
However the decline in revenue does not tell the entire story. Gross profit increased by 15% to Rs.442.5 million, indicating that the group’s remaining operations generated stronger margins despite the smaller revenue base. This suggests a deliberate movement towards businesses and assets capable of producing higher returns rather than simply pursuing top-line expansion.
Nevertheless, profitability remains fragile. Hunas Holdings recorded a loss before tax of Rs.5.1 million for the full financial year. The pressure became more visible in the quarter ended June 30, 2026, when the company reported a quarterly loss of approximately Rs.62 million amid weaker seasonal revenues.
The group’s liquidity position also requires close attention. Its debt-to-equity ratio stands at 0.46, reflecting moderate leverage, but the current ratio of only 0.51 indicates that current liabilities substantially exceed immediately available current assets. This creates a potential funding challenge as the company moves into a period requiring investment in new projects.
The absence of dividends adds another dimension. Hunas Holdings has never paid dividends and currently does not intend to do so, instead retaining cash to finance expansion. For shareholders, this means the investment proposition is increasingly linked to future asset development and earnings growth rather than immediate income distribution.
The group’s transformation followed a massive Rs.4.25 billion capital restructuring, bringing it under the control of Serenity Lake Leisure (Pvt) Ltd. The latter owns more than 89% of Hunas Holdings through direct holdings and margin-trading accounts associated with Cargills Bank and National Development Bank.
Serenity Lake Leisure itself is wholly owned by TAD Holdings (Pvt) Ltd, the holding company of the TAD Group, which has more than 30 subsidiaries.
Against this financial backdrop, Hunas Holdings is pursuing new opportunities. Its partnership with Tokyo-based CCH Inc. and Japanese investor Yoshimichi Watanabe is intended to support expansion in hospitality and real estate.
The planned revitalisation of the historic Visumpaya property in Colombo, leased from the Urban Development Authority and involving luxury travel innovator Adrian Zecha, represents another important project.
The central challenge is therefore clear: Hunas Holdings must convert its ambitious investment pipeline into sustainable cash-generating assets while managing its present liquidity constraints. Its transformation could create new growth avenues, but execution, financing discipline and project returns will determine whether expansion strengthens the balance sheet or increases financial pressure.