31 October 2013
The Johannesburg Stock Exchange (JSE) this week marks the 10th year anniversary of AltX, the exchange’s board for fast-growing small and medium enterprises.
AltX has a market capitalization of R15.4-billion, with 60 companies currently listed. Since its inception, 106 companies have listed on AltX, while 22 companies have subsequently migrated from AltX to the JSE’s main board.
Its top three sectors by market capitalisation are industrials, financials and basic materials, which together make up 91% of overall market cap.
“Ten years on we believe that AltX is even more relevant today, as South Africa desperately needs to grow small businesses to create employment,” Nicole Cheyne, client relationship manager for AltX, said in a statement on Wednesday.
“AltX provides smaller companies not yet able to list on the main board with a clear growth path and access to capital. That a number of companies have grown sufficiently to qualify for migration to the main board is testimony to AltX clearly meeting its objectives.”
Cheyne believes that a listing on AltX offers companies numerous benefits, including access to a large investor pool, greater opportunities for profiling, and enhanced relations with banks, suppliers, distributers and customers. AltX companies are also better able to retain and attract talent through share options.
“JSE research amongst AltX executives strongly indicate that they believe that their listing has helped them meet their objectives, whether these be raising capital, improving business processes or distinguishing them from their unlisted peers,” Cheyne said.
“Over 92% of respondents surveys indicate that they made acquisitions post their listing, indicating that AltX is a catalyst for growth.”
For investors, AltX offers investment opportunities in high-growth companies with solid fundamentals.
“Investors have the peace of mind that a listing on the AltX goes hand in hand with a requirement that companies comply with all the rules and regulations of the JSE and participate in the high standards of corporate governance,” Cheyne said.
The World Economic Forum’s (WEF’s) latest Global Competiveness Report, released in September, ranks South Africa first out of 148 countries for regulation of securities exchanges for the fourth consecutive year.