Profits of Softlogic Holdings Plc, which has interests in healthcare and electronics retail, fell around 60 to 80 percent short of forecasts made around the time of its IPO.
Softlogic Holdings reported profits of 493 million rupees for the year to March 2012, and analyst forecasts ranged from 1.320 billion rupees by the broking house Lanka Securities to 2.5 billion rupees by Asia Wealth.
A forecast of 2.5 billion rupees is over 450 times of the actual profits made.
Softlogic raised 4.0 billion rupees from shareholders.
Forecasts made for Expo Lanka group, which has a strong focus in logistics were 30 to 50 percent below forecast.
Expo Lanka reported profits of 1.05 billion rupees for the year to March and forecasts ranged from 1.5 billion rupees by Bartleet Mallory to 2.0 billion by John Keells Stock Brokers.
A forecast of 2.0 billion represents about 190 percent of the actual profits.
Expo Lanka raised 2.4 billion rupees from the share sale.
Analysts say forecasting profits of a diversified group is particularly difficult. Softlogic had also made a large acquisition that analysts did not know about at the time of the IPO.
But even at the time of the IPO there were rumblings of discontent about both issues, including about pre-IPO placements. But shareholders bought the stock anyway, with some brokers also giving 'subscribe' recommendations.
Investors who were hoping to unload the stocks on someone else soon after the IPO were then disappointed when the stocks fell.
The securities watchdog has since brought it lock-in rules.
The two IPOs were among the largest completed during Sri Lanka's stock market bubble, where punters lit fuses under illiquid stocks with margin credit - including some with weak fundaments - sending them rocketing up.
The stock bubble, fired by an extended period of loose monetary conditions which triggered a credit bubble, ended last year amid a balance of payments trouble and a sharp rise in interest rates.
Currency depreciation has also destroyed purchasing power of people's salaries and lifetime financial savings in banks and pension funds, which can help highly leveraged firms selling real goods.