N

VALUE IN BRANDS

Now in its 14th year, the most valuablebrand rankings reveal some significantshifts. One such shift is the rise ofDialog to the number two position on this table, displacing several bank brands that were ahead of it.

Dialog, which has been in businessfor less than 25 years, is setting the trend that we have seen occurthroughout the world in our globalbrand rankings. This is where newtechnology brands are rapidlyovertaking the legacy brands to change the business and brandlandscape.

This has long been a possibility asDialog has consistently had a ‘AAA’rating on our Brand Strength Index(BSI). This rating has conferred it to be the strongest or most powerfulbrand on our table for several years.

Brand power – denoted by the rating,with ‘AAA’ being the highest – is anindicator that it has the potential tocreate value in the long term, which is exactly what we are witnessing. Its strong brand has resulted in thecontinuous increase in brand value,catapulting it to take the second slotwith the top spot not being too far out of reach.

It is not only the rankings that areimportant as all banks should bewareof Dialog. It has a much broader

agenda, reaching beyond its coretelecommunications industry as itmoves more aggressively into thefinancial services industry in the future. In fact, Dialog is already deeply entrenched in payment services with eZ cash, which hasemerged as the strongest brand in our new e-commerce table.

The other significant change in ourtable is reflected in the bifurcation ofthe insurance sector into general and life insurance businesses, whichwas a regulatory directive. So the twosegments will be managed and run astwo separate businesses henceforth.

Several brands have already shed thegeneral insurance business arm whileretaining the more profitable lifebusiness as seen by Union Assurance(life business), AIA Insurance andAsian Alliance (now Softlogic Life).Others – such as Sri Lanka Insurance,Ceylinco, Janashakthi, HNB Assuranceand Amana Takaful – continue to runboth their life and general businessesunder a single brand. These businesseswill need to make a critical decision on their future branding strategies andhow they intend to approach these two very different markets.

As this is the first year in which weare tabulating the separate insuranceentities, it is too early to clearly predict

how they will perform. There is very little separation in a majority of the brands at this early stage. It willbe interesting to see how these brandspan out in the future.

The main use of our brand value tableis to ascertain the performance of abrand over time and its future potentialto create value. The challenge for thosein the leading 50 is to ensure that theymaintain that single-minded focus ongrowth by strengthening the brand.This needs to take place throughdefining or redefining the brand where relevant, as well as by constantlydifferentiating through innovation.

On the other hand, the bottom 50brands have much work to do toestablish themselves in their respectivemarkets and work towards a strategicapproach to long-term brand-building.

The process of identifying SriLanka’s most valuable brands beginsby reviewing the consumer-facingcompanies that are listed on theColombo Stock Exchange (CSE). By analysing both the financial andmarketing performance of these listed brands, we are able to determine which of them aregenerating the highest brand value.

Over the years, many companies havebegun to report on our brand value intheir annual reports while some are

Sr i Lanka’s most valuable brands

14 I BRANDS ANNUAL I 2017

even using it as a measure for internalmanagement purposes. Due to thehistorical data that we collate, brand-value performance can be tracked overtime. In addition to the rate of increasein value, the brand performance ofcompetitors can also be tracked(providing they are listed companies)to benchmark high-value performersover the stragglers.

The importance of tracking brandvalue is that it enables businesses tomeasure its ability to create overallbusiness value in the future.

So how does it work?Business value is created by

stakeholder behaviour towards the brand. This is demonstrated through aspects such as a customer’swillingness to pay a higher price (morerevenue), suppliers’ willingness topartner by providing better commercialterms resulting in reduced costs, bankslending at lower rates (lowerfinance costs), moreloyal and smarteremployeesworking forless, whichwouldreduce costs and so on,which are allinfluenced bytheir individualperceptions.

By understanding whatdrives these perceptions, wegain insight into how positivebehaviour towards the brand could beinfluenced. Therefore, if we understandthese drivers of value, we can factorthat into how the brand is perceived,which will result in greater valuecreation.

The pivotal point of the valuecreation process is building thebrand in a manner that willpositively engage with thesestakeholders. If we know what those considerations are, we can help nurture and cement therelationship through a commonplatform that is relevant to them.

This requires brand management totease out and identify the key valuedrivers around which the businessshould be aligned that includes featuressuch as pricing, availability andproduct design. It is here thatquantitative and qualitative researchshould be deployed to understand these drivers of value, which can then be integrated into the brand. IN

GIM

AG

E©

15 I BRANDS ANNUAL I 2017

2017 2017 2017 20172017 2016 BRAND BRAND ENTERPRISE BV/EV

RANK RANK BRAND NAME PARENT COMPANY INDUSTRY VALUE (RS. M) RATING VALUE (RS. M)

1 1 BOC Bank of Ceylon Banking 40,598 AA N/A N/A

2 4 Dialog Dialog Axiata Telecommunications 34,101 AAA - 112,361 30%

3 2 People's Bank People's Bank Banking 31,416 AA N/A N/A

4 5 Commercial Bank Commercial Bank of Ceylon Banking 25,606 AA+ 124,880 21%

5 3 NSB National Savings Bank Banking 24,586 AA N/A N/A

6 6 Lion Beer Lion Brewery (Ceylon) Beverages 21,651 A 45,078 48%

7 8 SriLankan Airlines SriLankan Airlines Airlines 20,852 AA - 131,618 16%

8 7 Nestlé Nestlé Lanka Food 20,229 AA+ 108,247 19%

9 9 HNB Hatton National Bank Banking 20,075 AA 89,867 22%

10 10 Cargills Food City Cargills (Ceylon) Supermarkets (Retail) 16,078 AAA - 54,065 30%

11 11 Sampath Bank Sampath Bank Banking 15,048 AA 46,546 32%

12 12 Singer Singer (Sri Lanka) Retail 13,745 AAA - 35,247 39%

13 14 DCSL Distilleries Company of Sri Lanka Beverages 10,216 A 83,304 12%

14 13 SLT Sri Lanka Telecom Telecommunications 9,350 AA - 45,782 20%

15 20 Elephant House Ceylon Cold Stores Beverages 8,344 AAA - 69,595 12%

16 15 PLC People's Leasing & Finance Financial services (Leasing) 7,614 AA 26,542 29%

17 22 Mobitel Sri Lanka Telecom Telecommunications 6,925 A+ 37,144 19%

18 19 NDB National Development Bank Banking 6,919 A 25,273 27%

19 18 Seylan Bank Seylan Bank Banking 6,615 A+ 25,991 25%

20 17 Keells Super JayKay Marketing Services Supermarkets (Retail) 6,492 AA+ N/A N/A

21 25 Cinnamon John Keells Holdings Hospitality 5,707 AA 27,173 21%

22 24 Arpico Supercentre Richard Pieris Supermarkets (Retail) 5,631 AA - 28,765 20%

23 New LOLC Finance LOLC Finance Financial services 4,562 A+ N/A N/A

24 27 Rocell Royal Ceramics Lanka Building materials 4,277 AA 31,276 14%

25 29 Commercial Credit Commercial Credit & Finance Financial services (Leasing) 4,059 A+ N/A N/A

26 26 LB Finance LB Finance Financial services 3,853 A 16,774 23%

27 31 Lanka IOC Lanka IOC Oil and gas 3,617 A 13,846 26%

28 32 Tokyo Cement Tokyo Cement Company Building materials 3,533 A+ 24,986 14%

29 30 Central Finance Central Finance Company Financial services 3,331 A 21,242 16%

30 28 Nations Trust Bank Nations Trust Bank Banking 3,316 A - 17,987 18%

31 33 Dilmah Dilmah Ceylon Tea Company Beverages 2,896 A 8,905 33%

32 New Sri Lanka Insurance General Sri Lanka Insurance Corporation Insurance 2,391 AA+ N/A N/A

33 New Ceylinco General Insurance Ceylinco General Insurance Insurance 2,329 AA+ 14,596 16%

34 New Ceylinco Life Ceylinco Life Insurance Insurance 2,275 AA 14,487 16%

35 New Sri Lanka Insurance Life Sri Lanka Insurance Corporation Insurance 2,173 AA+ N/A N/A

36 34 Prima Ceylon Grain Elevators Food 2,125 A+ 4,521 47%

37 39 Pan Asia Bank Pan Asia Banking Corporation Banking 1,948 A - 5,694 34%

38 35 Asiri Health Asiri Hospital Holdings Healthcare 1,751 A 40,929 4%

39 38 DFCC Bank DFCC Bank Banking 1,660 A 31,361 5%

40 41 RDB Regional Development Bank Banking 1,606 BBB N/A N/A

41 48 ACL ACL Cables Building materials 1,494 A+ 8,191 18%

42 51 Mitsubishi United Motors Lanka Motor 1,476 A+ 10,147 15%

43 45 Keells Foods Keells Food Products Food 1,343 AA - 3,953 34%

44 44 Commercial Leasing Commercial Leasing & Finance Financial services (Leasing) 1,297 BBB 21,684 6%

45 40 ODEL ODEL Retail 1,253 AA 8,167 15%

46 New Janashakthi General Janashakthi General Insurance Insurance 1,233 AA - 8,782 14%

47 New Union Assurance Union Assurance Insurance 1,229 AA - 8,945 14%

48 56 Kelani Cables Kelani Cables Building materials 1,101 AA+ 2,341 62%

49 54 LAUGFS Gas LAUGFS Gas Oil and gas 1,081 A 26,143 4%

50 47 Harischandra Harischandra Mills Food 1,064 A - 2,281 47%

FOOTNOTES Brand Finance has produced this study with an independent and unbiased analysis. The values derived and opinions in this study are based only on publicly available information. No independent verification or audit of such materials was undertaken. Brand Finance accepts noresponsibility and will not be liable in the event that the publicly available information relied upon is subsequently found to be inaccurate. The brandvaluations for Sri Lanka’s Top 100 brands follow IVSC guidance but will only comply with ISO 10668 Monetary Brand Valuation Standard whenaccompanied by detailed legal and behavioural analysis. The conclusions expressed herein are the opinions of Brand Finance. They are not intended

MOST VALUABLE BRANDS

16 I BRANDS ANNUAL I 2017

2017 RANKINGS

to be warranties or guarantees that a particular value or projection can be achieved in any transaction. The opinions expressed here are not to be construed as providing investment advice. Brand Finance does not intend this to be relied upon for technical reasons and excludes all liability to any organisation. Enterprise value is calculated for all brands except in the case of the financial services industry – viz. banks, leasing, insurance and financial services – where market capitalisation is used. Market capitalisation is used for these sectors as they have considerable debt and sohaving an enterprise value does not represent market value.

2017 2017 2017 20172017 2016 BRAND BRAND ENTERPRISE BV/EV

RANK RANK BRAND NAME PARENT COMPANY INDUSTRY VALUE (RS. M) RATING VALUE (RS. M)

51 58 HDFC Bank HDFC Bank of Sri Lanka Banking 914 BB 2,983 31%

52 50 Mercantile Investments Mercantile Investments and Finance Financial services 899 BB 7,756 12%

53 52 AIA Insurance AIA Insurance Lanka Insurance 895 A 8,364 11%

54 49 CDB Citizen Development Business Finance Financial services 885 BBB 3,728 24%

55 55 Caltex Chevron Lubricants Lanka Oil and gas 875 AA - 36,951 2%

56 57 Bairaha Bairaha Farms Food 845 A - 3,073 28%

57 65 Alliance Finance Alliance Finance Financial services 816 BBB 2,055 40%

58 76 MBSL Merchant Bank of Sri Lanka & Finance Financial services 774 BBB 2,237 35%

59 66 Union Bank Union Bank of Colombo Banking 757 A - 16,480 5%

60 New Hutch Telecommunications Hutch Telecommunications Lanka Telecommunications 733 A - 6,511 11%

61 New Asian Alliance Asian Alliance Insurance Insurance 733 A 7,275 10%

62 77 Senkadagala Finance Senkadagala Finance Financial services 702 B 5,870 12%

63 64 Nawaloka Hospitals Nawaloka Hospitals Healthcare 633 A 11,092 6%

64 72 Abans Abans Electricals Retail 616 AA 1,179 52%

65 69 Lankem Lankem Ceylon Chemicals 615 A 9,945 6%

66 73 Taj Samudra TAL Lanka Hotels Hospitality 601 BBB 5,581 11%

67 67 Vallibel Finance Vallibel Finance Financial services 595 BBB 2,497 24%

68 85 TFC The Finance Company Financial services 566 A 657 86%

69 59 Lanka Hospitals Lanka Hospitals Corporation Healthcare 557 A - 14,293 4%

70 53 Ashok Leyland Lanka Ashok Leyland Motor 553 BB 5,531 10%

71 79 Morison's J. L. Morison Son & Jones Personal care 550 A N/A N/A

72 74 Softlogic Finance Softlogic Finance Financial services 510 BB 2,067 25%

73 75 Swadeshi Swadeshi Industrial Works Personal care 487 B 2,293 21%

74 80 Kotmale Cargills (Ceylon) Food 468 A+ N/A N/A

75 60 Lanka Soy Convenience Foods Lanka Food 440 A - 590 74%

76 81 Amaya Amaya Leisure Hospitality 436 BB 5,481 8%

77 70 SMIB State Mortgage & Investment Bank Banking 410 CCC N/A N/A

78 82 Singer Finance Singer Finance (Lanka) Financial services 406 B 3,059 13%

79 68 Durdans Ceylon Hospitals Healthcare 386 A - 4,125 9%

80 71 Lakspray Lanka Milk Foods Food 375 A 5,159 7%

81 84 Isuzu Sathosa Motors Motor 371 BBB N/A N/A

82 New HNB Assurance HNB Assurance Insurance 356 A - 1,349 26%

83 82 Amana Bank Amana Bank Banking 344 CCC 4,628 5%

84 New Janashakthi Insurance Janashakthi Insurance Insurance 315 A+ 2,761 11%

85 New HNB General Insurance HNB General Insurance Insurance 310 BBB 1,306 24%

86 87 Lanka Bell Lanka Bell Telecommunications 271 B N/A N/A

87 78 Sierra Cables Sierra Cables Building materials 268 BB 2,044 13%

88 88 Lucky Yoghurt Lucky Lanka Milk Processing Food 259 A - 896 29%

89 89 Jetwing Lighthouse The Lighthouse Hotel Hospitality 252 A 2,559 10%

90 86 National PVC Pipes Central Industries Building materials 241 A 941 26%

91 93 Citrus Citrus Leisure Hospitality 223 B 4,985 4%

92 91 Heladiv HVA Foods Beverages 196 CCC 830 24%

93 New CSE Colombo Stock Exchange Financial services 158 A - 5,124 3%

94 95 Arpico Finance Arpico Finance Financial services 146 BB 1,272 11%

95 90 Dankotuwa Dankotuwa Porcelain Housewares 141 BBB 1,401 10%

96 94 Heritance Ahungalla Aitken Spence Hotel Holdings Hospitality 131 B N/A N/A

97 98 Sinhaputhra Finance Sinhaputhra Finance Financial services 122 CC 919 13%

98 New Amana Takaful General Amana Takaful Insurance Insurance 122 BB 900 14%

99 New Amana Takaful Life Amana Takaful Life Insurance 96 BB 540 18%

100 97 The Fortress The Fortress Resorts Hospitality 76 CCC 946 8%

17 I BRANDS ANNUAL I 2017