Financial troubles in East Asia and Russia were restraining this year's profits for the 20 companies, Sri Lanka's biggest in terms of market capitalisation, the analysts said.

In the 1997-98 (April-March) and 1997 calendar year growth was stronger, averaging 35 per cent, they said.

The analysts polled were from brokerages Allied Phillips Securities, WI Carr/Asia Securities, CDIC Sassoon Cumberbatch, Ceylinco Stock Brokers, CT Smith Stock Brokers, John Keells Stock Brokers, Lanka Securities and NDBS Stock Brokers.

``The growth in the three blue chip conglomerates at around 20 per cent might even be overestimated due to their exposure to plantations and the Russian problem,'' head of research Nouzab Fareed at brokerage Allied Phillips Securities told Reuters.

``We haven't downgraded ourforecasts for the conglomerates, but the Russia issue needs to be watched,'' said equity analyst Praveen Ramanaden at CT Smith Stock Brokers.

Sri Lanka's largest blue chip conglomerate, John Keells Holdings Ltd owns and manages three tea plantations.

Russia is Sri Lanka's biggest tea buyer, but industry analysts worry the rouble's fall and general economic uncertainty there could delay payments to local firms, hurting profits.

``Aitken Spence & Co Ltd could benefit from its international exposure and John Keells from its operations in the food and beverage sector, which overall will do well on volumes,'' said research head Sarath Rajapakse at CDIC Sassoon Cumberbatch.

John Keells' food and beverage arm is led by Ceylon Cold Stores Ltd, which controls a large chunk of the local soft drink and ice cream market.

Aitken Spence owns and manages five hotels in Sri Lanka and two properties in the Maldives. It also plans to acquire a third resort in the Maldives at cost of around $11-12 million.

Analystssaid the Asian crisis was expected to hit export- oriented conglomerates like Hayleys Ltd. More than 50 per cent of profits of Hayleys come from exports of rubber and coconut-derived products such as coir fibre and activated carbon.

``Although Richard Pieris & Co Ltd is an exporter and manufacturer, it functions more like a conglomerate, so it should profit from the diversification,''" Janaka Udamulla, equity analyst at brokerage Lanka Securities said.

``Richard Pieris' local retail outlets should also mitigate any losses from exports,'' Rajapakse added.

Analysts said three listed banks -- Hatton National Bank, Commercial Bank and Sampath Bank -- should see improved margins following lower deposit rates.

``Their lending also has been conservative, so provisioning won't be great,'' Ramanaden added.

``The main problem for the two development finance banks (DFCC Bank and National Development Bank will be steep provisioning due to their exposure to the declining stock market,'' Udamulla said.

Heavyselling in recent weeks has seen the Colombo all share index plummet to a seven-year low.