Originally formed in 1887 during the first South African gold rush, the Johannesburg Stock Exchange (JSE) is the largest equities trading venue on the African continent. Ranked globally as a top 20 stock exchange, the JSE furnishes traders with a diverse array of equity products facing the commodity, banking and luxury goods sectors.  The JSE is licensed for operation in adherence to the Financial Markets Act, No. 19 of 2012.
21st century mergers with the South African Futures Exchange (SAFEX) and the Bond Exchange of South Africa (BESA) have expanded the JSE's listings extensively. Currently, five distinct markets are offered to traders and investors: equities and bonds as well as financial, commodity and interest rate derivatives.
In July 2013, the JSE introduced the Millennium Exchange as a brand-new digital trading platform designed to streamline equity market functions. Further, exchange operations were moved from London to Johannesburg, reducing latency and boosting liquidity multifold.
As of year-end 2016, the JSE ranked as the 17th largest stock exchange in the world, with a market cap of US$1.07 trillion. Featuring equity products related to a broad spectrum of asset classes, the JSE offers almost 400 companies for trade on its Main Board and AltX markets. In contrast to the large-cap Main Board, AltX specialises in the trade of small and mid-size corporate offerings.
To gain membership and become listed on the JSE's Main Board, a company must meet the following specifications:
- Secure capital reserves of at least ZAR50,000,000
- Issue more than 25,000,000 shares
- Perform a three-year financial audit, with the final year showing a pre-tax income of more than ZAR15,000,000
- 20% of each stock designation (common, preferred) must be allocated for public trade
In addition to these requirements, listing companies must pay a nominal fee to the JSE for trade to commence. Upon all prerequisites being satisfied, the corporation's stock is then available for public trade on the exchange platform.
Although physically located in South Africa, international investors look to the JSE as a way of accessing the economic growth potential of the African continent. Below are the forms and functions of the 10 largest companies listed on the JSE according to market capitalisation.
1. Anheuser-Busch InBev (ANH) - ZAR2,341.75 billion
Anheuser-Busch InBev is an internationally dominant beverage and brewing firm. Considered to be the world's largest brewer, it is a top five global consumer goods producer, commanding 30% of the aggregate market. Anheuser-Busch InBev was formed by mergers of beverage giants Interbrew (Belgium), AmBev (Brazil) and Anheuser-Busch (U.S.).
Featuring a global portfolio of more than 200 brands, Anheuser-Busch InBev first listed on the JSE in 2016. The company supports 172,603 employees in 25 different countries. For 2018, InBev reported US$54.6 billion in revenue. Shares of Anheuser-Busch InBev are also available for trade on the Euronext and Mexico Stock Exchange.
2. Prosus N.V. (PRX) - ZAR1,770.87 billion
Prosus N.V. is a tech company that serves as the international investment arm of Naspers. Self-described as a "global consumer internet group," it exists as a conglomeration of purchased internet firms such as OLX, PayU, iFood and Ctrip. Prosus' most notable investment is a 31% stake in Chinese tech giant Tencent.
Prosus is primarily listed on Euronext Amsterdam and offered for trade secondarily on the JSE. Holding assets in 120 countries, Prosus employs 20,196 people. For 2018, the company produced US$19.0 billion in revenue, with US$3.3 billion in profits from trading operations.
3. British American Tobacco PLC (BTI) - ZAR1,266.08 billion
Headquartered in London, British American Tobacco (BAT) conducts operations in 180 countries and is a top five global tobacco producing/marketing company. BAT owns popular brands Palmal, Lucky Strike Dunhill, Kool and Kent. It is primarily listed for trade on the London Stock Exchange while also being available on the JSE.
Founded in 1902, BAT specialises in the production of cigarettes, fine cut tobacco and Swedish snus. It controls more than 10% of the global cigarette market, with nine of its 44 production facilities being located in Africa. Profits for 2018 were reported at GBP4,006 million, up 244% from 2017.
4. The BHP Group PLC (BHP) - ZAR659.41 billion
BHP Billiton (BHP) is an Australia-based mining conglomerate that specialises in the discovery and extraction of natural resources, specifically mineral and energy cultivation. It supports more than 72,000 employees and independent contractors, primarily located in Australia and the Americas.
In addition to the JSE offering, BHP Billiton is listed for trade on the Australian Stock Exchange and the London Stock Exchange. For 2018, BHP's profits came in at US$8.9 billion, constituting 33% year-over-year growth.
5. Glencore PLC (GLN) - ZAR644.13 billion
Founded in the 1970s, Glencore is a globally renowned producer and marketer of commodities. Headquartered in Switzerland, Glencore employs more than 158,000 people in 50 countries. It focuses efforts on core businesses that are rooted in mining, oil and agricultural production. Leading commodities are copper, nickel, zinc, crude oil and thermal coal.
Aside from trade on the JSE, Glencore is primarily listed on the London Stock Exchange. For the year 2018, GLN reported a gross revenue of US$15.8 billion, making it an internationally prominent natural resource company.
6. Compagnie Financiere Richemont SA (CFR) - ZAR574.25 billion
Established in 1988, Richemont came to be when the Rembrandt Group chose to form a new entity from its exclusively non-South African holdings. Richemont's featured businesses are focused upon high-end jewelry and watchmaking. Ownership shares are established in luxury good providers Cartier, Van Cleef, Baume & Mercier, Jaeger-LeCoultre and Piaget.
As of March 2018, Richemont established itself as an industry leader, reporting €1,221 million in annual profits. This figure represents a 128% gain year-over year. Shares of Richemont are primarily available for trade on the Swiss Exchange, with additional listings on the JSE.
7. Anglo American PLC (AGL) - ZAR505.19 billion
Headquartered in London, England, Anglo American PLC is an international leader in the mining industry. Anglo employs more than 64,000 people worldwide, with operations across South Africa, the Americas and Australia. Featured products are diamonds, copper, platinum, coal, iron and nickel.
Shares of AGL stock are available on the London Stock Exchange, JSE and as an over-the-counter (OTC) pink-sheet offering. For the fiscal year 2018, Anglo generated US$9.2 billion in gross revenue from operations, ensuring its stance as a world-class mining company.
8. FirstRand Limited (FSR) - ZAR378.98 billion
FirstRand Limited is a group of financial services providers based in South Africa with branches in sub-Saharan Africa, India and the United Kingdom. FirstRand's Operations are focussed upon the facilitation of transactions, lending, and the provision of investment/insurance products.
In terms of market capitalisation, FirstRand is the largest financial institution in Africa. It is listed for trade on both the JSE and Namibian Stock Exchange. As of 30 June 2019, the company held total assets in excess of US$111 billion and annual earnings of US$2.0 billion. These figures establish FirstRand as the banking industry leader for the continent of Africa.
9. Standard Bank Group LTD (SBK) - ZAR294.30 billion
A prominent figure in the South African financial sector, Standard Bank Group affords financial facilities to customers based in Africa. Standard's core businesses include the provision of personal banking, lending, investment and wealth management services.
Employing 52,000 workers, Standard is the largest bank in Africa with respect to total assets (US$157 billion). As of 30 June 2019, annual earnings were reported as US$941 million and shares of Standard are listed for trade primarily on the JSE.
10. Anglo American Platinum LTD (AMS) ZAR287.79 billion
A division of Anglo American PLC, Anglo American Platinum is a top three global producer of platinum. With mining operations that focus on platinum group metals, base metals and precious metals, Anglo Platinum employes 30,000 people in total.
Headquartered in Johannesburg, Anglo Platinum's shares are listed exclusively for trade on the JSE. For the fiscal year 2019, gross revenues increased by 82% to ZAR12.4 billion. The strong financial performance solidified Anglo Platinum's standing as a global leader in the production of platinum.
Senior Market Specialist
Russell Shor (MSTA, CFTe, MFTA) is a Senior Market Specialist at FXCM. He joined the firm in October 2017 and has an Honours Degree in Economics from the University of South Africa and holds the coveted Certified Financial Technician and Master of Financial Technical Analysis qualifications from the International Federation…