With the flourishing of Indian cinema in the 1940s, he established his own cinema company, Sri Murugan Navakala Limited, named after the Hindu deity Murugan.
The company was based in Madurai, owning a studio (Chitrakala Movietone) at Thiruparankundram.
[2] Nayagam was thus inspired to produce a film in the Sinhala language.
After considering several storylines, he settled on a popular Sinhala stage play, going on to produce Kadawunu Poronduwa.
[6] The film was shot at his own studio, with all technicians from India but the cast brought from the island country for this purpose.