Paul Miller of AmaranthCX reviews the 30 June 2022 half time listing/delisting state-of-play and the picture is not looking good for SA's public markets.
South Africa had 332 listed companies at the beginning of 2022 – across the JSE and the three challenger stock exchanges which host primary listings.
18 companies have already delisted this year.
14 companies are in the formal process of delisting, or are subject to corporate action that is likely to result in their delisting.
There are 16 companies suspended from trade or which have not been able to publish their financial results. A few are fighting hard to get their listings re-instated. A significant number of these companies are likely to be delisted at some point.
This suggests that at least 32, and perhaps significantly more companies, will delist from South African stock exchanges in 2022. The denominator has been shrinking for 7 straight years so this delisting number is getting very significant in percentage terms. Bottom line is that this year at least one in ten of all listed companies are anticipated to delist.
There have been 6 new listings this year so far as at 30 June 2022 – 3 on the JSE and 3 on the CTSE – 2 were transfers between SA exchanges, so there were only 4 new listings added, so far this year, to the total number of listed companies.
There are at least 8 known listings in the pipeline, although none are firm and the listing dates may be pushed into 2023 - African Bank, Avis Budget Southern Africa, Copper360, Coca Cola Bottling Africa, Fidelity Services, Cilo Cybin, Premier Foods, and possibly Telkom's Swiftnet.
Besides the JSE's ongoing initiatives to cut red tape, there does not appear to be any likelihood of a policy response by National Treasury, the policy maker who should be concerned with this situation.