Please give these 50 away to some other stock market
THE TOTAL MARKET capitalisation of the 50 smallest shares on the JSE was just R1 100m last week. In big figures, that’s R1,1bn. The total market value of listed shares on the JSE last week was R5 500bn, or R5,5 trillion – if that kind of figure means anything to you. The turnover of ordinary shares on the JSE is currently just more than R10bn/day.
The total turnover of the 50 small fry over the past year was less than R350m.
More than a dozen of those little ones had a total turnover of less than R1m over the past year. Right at the bottom of the 50 little ’uns is the name of Decillion, with a market value of R3,5m, yet it’s a company listed on the JSE’s main board. Even the market value of Bernard Swanepoel’s Village Main – he was the bull of the year when he was still Harmony CEO – is just a little more than R6m.
Other ridiculous offerings with a value of less than R10m include Wooltru, the former holding company of Woolworths, and Awethu Breweries. There are 11 listed companies with a value of less than R10m. Two of those can plead innocent, because their listings are in any case currently suspended.
At the head of the list of the 50 smallest is Moneyweb with a market value of more than R40m. Nothing wrong with that. In fact, about two years ago it did the right thing by shifting its listing from the JSE’s main board to AltX, the sector specially created by the JSE for smaller companies.
If the annual turnover of some of those shares is examined their listing becomes even more irrelevant. Last year the total turnover of the 50 smallest was just R350m. At least R100m (AGI’s turnover) must be deducted from that. That occurred before the company’s share price collapsed completely, making it now a “proud” member of the bottom 50.
There are rumours around again about a new group that will soon apply – or has already done so – for a second share market licence in direct competition with the JSE. Their target market is apparently the 500 biggest companies currently not listed on the JSE. Perhaps the JSE will be doing them a favour by not opposing the application and even going as far as donating the bottom 50 to this new exchange.