South Africa’s public markets experienced an intriguing 2024, signalling a possible shift in long-established trends. Nine companies listed their shares on South African exchanges this year — eight on the JSE and one inward dual listing on the A2X. While still modest, this represents a 50% improvement over 2023’s all-time low, when just six companies listed — three on the JSE and three on the Cape Town Stock Exchange. However, a deeper dive into these nine listings reveals a more complex picture.
Most of this year’s listings resulted from corporate actions involving existing listed entities rather than new companies raising growth capital. For instance, inward dual-listed PowerFleet replaced MiX Telematics’ listing, while WeBuyCars was spun off from the struggling Transaction Capital. Rainbow Chickens separated from RCL Foods, AltVest moved from the Cape Town Stock Exchange to the JSE, and Boxer emerged after being spun off from a distressed Pick n Pay. Boxer’s listing generated significant attention through its heavily sought after private placement.
The only truly growth-oriented Initial Public Offering was the nano-cap Cilo Cybin, a cannabis company that raised capital to join the public market. Additionally, one London-listed junior mining company, Marula Mining, listed its shares on the A2X, while two London-listed property Real Estate Investment Trusts, Assura and Supermarket Income, utilised the JSE’s fast-track listing process for secondary listings. These trusts were probably drawn by South Africa’s institutional investor preference for commercial property under the Regulation 28 prudential requirements for retirement funds.
Despite these developments, there were no blockbuster Initial Public Offerings from entirely new businesses, highlighting a key challenge: attracting growth-focused companies to rejuvenate South Africa’s listed markets.
The most notable development in 2024 was the significant slowdown in delistings. Only 11 companies exited local exchanges this year, a marked decline from the average of 24 annually over the past five years. Net delistings —11 exits against nine listings — resulted in just two more delistings than listings in 2024, compared with an average of 17 more delistings than listings annually in the previous five years. This shift represents a substantial change and a glimmer of hope.
Are delistings really a global trend?
South Africa commentators, including exchange operators and institutional asset managers, often describe the delistings trend as being global, but a closer look shows major differences across markets. While UK and US exchanges have seen declining listings, other regions are thriving. Australia and Canada have demonstrated stability and resilience against the delistings trend, while markets in India, South Korea, Indonesia, and Israel continue to attract new listings.
Sweden’s vibrant public markets have successfully drawn innovative, growth-oriented companies, supported by strong retail investor participation, a supportive investment culture, and Initial Public Offering-friendly regulations. Similarly, Vietnam has emerged as a hotspot for listings, leveraging its dynamic economy and regulatory reforms to attract both local and international companies. These examples challenge the notion that net delistings are a universal trend.
Equally, the idea that the private equity and venture capital industries are crowding out public markets may resonate in markets with robust alternative investment sectors, but it holds less relevance in South Africa due to the relatively small size and impact of the local industries. While private capital does influence some listing and delisting decisions, there is little evidence that it is a significant factor driving companies away from South Africa’s public markets.
Among the companies leaving exchanges, the JSE saw nine exits, including MiX Telematics, Textainer, African Equity Empowerment, Afristrat, Basil Read, Cognition Holdings, Grindrod Shipping, Buka Investments (formerly Imbalie Beauty), and Sasfin (set to delist on Monday, 30 December 2024).
The Cape Town Stock Exchange lost two: AltVest, which moved to the JSE, and Assupol, acquired by Sanlam. The slower pace of delistings indicates possible stabilisation, though the challenge remains to attract genuinely growth-driven listings.
The crucial role of retail investors
A crucial aspect of market health is the participation of retail investors, who play a vital role in supporting smaller companies and raising primary equity capital.
Two standout primary capital raisings in 2024 highlighted innovative strategies to engage retail investors. Orion Minerals, in part in collaboration with the Utshalo primary capital raising platform, raised A$3.6-million, with a significant contribution from South African retail investors, showcasing the potential for democratising junior mining investments.
Similarly, AltVest’s listing on the JSE’s AltX Board raised over R18-million through Easy Equities, enabling widespread retail participation. These examples demonstrate how partnerships with retail-focused investment platforms can expand the investor base and rejuvenate the smaller-cap market.
After criticism for its initial exclusionary approach, the Boxer listing eventually allocated a substantial portion of its R8.5-billion placement to retail investors via traditional brokerages and platforms like Easy Equities. Sean Summers, Pick n Pay’s CEO, described this as a “more than normal” allocation to retail investors, illustrating their potential impact on primary capital raising when given fair access.
However, Boxer’s approach fell short of actively reaching out to new retail investors, instead favouring legacy brokerage clients. For sustained growth, South Africa’s public markets must better engage new entrants, especially those historically excluded from direct participation in public markets.
Operation Phumelela
An interesting development in 2024 was the launch of Operation Phumelela: The South African Financial Sector Competitiveness Taskforce. This initiative aims to position South African capital markets as a regional financial hub, focusing on institutional investors and goals such as “improving efficiencies, reducing frictions, and enabling financial institutions to better manage investment and capital formation”.
However, it does not appear to intend to address reducing costs for, or eliminating the unfair tax treatment of, direct investors and individual savers — which are key barriers to broader market participation.
The taskforce’s composition, dominated by large business leaders and their law firms, suggests that the needs of retail investors and their importance to market health may remain overlooked.
Meanwhile, the South African Revenue Service’s review of tax benefits for Collective Investment Schemes has drawn attention to the preferential treatment of institutional investment vehicles. Collective Investment Scheme income is untaxed, and capital gains tax is deferred until units are sold — advantages not extended to individual investors with personal share portfolios. Unlike most developed financial markets, South Africa’s policies explicitly favour large financial institutions, which then charge among the highest retail investment fees globally. This unfair bias discourages direct investment and undermines public market vitality.
Several factors could support a stronger primary capital-raising environment in South Africa. Improvements in electricity supply, long-promised structural economic reforms, and an anticipated decline in global interest rates provide a more favourable backdrop. Additionally, 2024 marked the first net foreign inflows into South African debt and equity markets since 2022, signalling renewed international interest.
While 2024 brought no dramatic reversals, the slowdown in delistings and modest rise in listings suggest a potential turning point for South Africa’s public markets. To build on this momentum, policymakers, exchanges, and market participants must address structural barriers in the savings industry, promote direct retail participation, and create conditions conducive to growth-oriented Initial Public Offerings. With effort and good fortune, 2025 could mark a more definitive recovery for the country’s listed markets. DM