Major backing The JSE is actively positioning itself as a leading platform for mining investment in Africa When Benjamin Wollan founded the JSE in 1887 it was a year after the discovery of gold on the Witwatersrand. Mining was booming, and a stock exchange was the perfect vehicle for the new exploration companies to raise capital. Hence, from the first days of the JSE, mining companies have historically been major drivers of the bourse, with the sector representing a substantial portion of the exchange’s overall value (listed miners represent 32% of the total market cap), while the JSE Mining Index achieved an impressive annual return of 18.66% for the year 2024, surpassing the performance of the FTSE/JSE All Share Index, which recorded an annual return of 13.4% for the same period. This legacy continues to influence the JSE’s strategic direction and its appeal to investors, says Patrycja Kula-Verster, Primary Markets Business Development Manager of the JSE. ‘By accessing capital through the JSE, mining companies can reach a wider range of investors, improve liquidity and gain greater visibility both locally and internationally. This is especially important for companies involved in critical minerals, which are vital for the global transition to renewable energy and advanced technologies.’ She says the exchange is seeing interest from SA pension funds and asset managers seeking mining exposure, and that they have shown significant interest in established projects due to their potential for high returns and their role in supporting economic growth. By investing in JSE-listed mining companies, pension funds and asset managers can gain exposure to a sector that is crucial for the country’s economic development and the global supply chain of critical minerals. ‘Their participation provides essential capital for mining companies, enabling them to undertake large-scale projects and drive innovation. These investors are attracted to the potential for high returns, diversification benefits and the strategic importance of mining to the South African economy. Additionally, the JSE’s regulatory framework and market infrastructure offer a stable and transparent environment for investment.’ Kula-Verster says the JSE continues to collaborate with local asset managers and pension funds to facilitate more investment into the mining sector. The JSE has introduced actively managed certificates (AMCs). These new investment products offer a balanced approach to wealth accumulation and are designed to attract both institutional and retail investors. AMCs provide tailored exposure to various asset classes, of which one sector could include specific mining exposure. This allows investors to benefit from professional management, diversified portfolios and targeted sector exposure, enhancing their investment strategy and potential returns. In addition to traditional equity and debt financing, mining companies are increasingly turning to alternative financing options, including streaming, royalty agreements and private placements. The JSE’s offerings complement these alternatives by providing a robust platform for raising capital through public markets. This combination allows mining companies to optimise their financing strategies to support growth and development. The JSE Private Placements (JPP) platform is becoming a key avenue for mining companies to access private capital. JPP connects private companies seeking finance with qualified investors, offering a streamlined, cost-effective way to raise capital. This platform allows mining companies to raise funds from select investors through equity sales or debt issuance, providing a flexible and efficient way to secure necessary financing. By leveraging JPP, mining companies can attract investment for various projects, including mine development and expansion, without the need for public issuance. This approach helps them diversify their funding sources and reduce reliance on traditional financing methods. Kula-Verster says the JSE continues to innovate with products tailored for the mining sector, including carbon credits. These credits help mining companies offset their carbon emissions, comply with environmental regulations and enhance their sustainability profiles. By incorporating carbon credits into their operations, mining companies can achieve net-zero goals, improve their environmental impact and unlock additional financial opportunities. ‘Initiatives such as innovative new products, improving financial literacy and creating acceleration programmes for junior miners are part of this strategy. By addressing the needs of both investors and mining companies, the JSE aims to attract more capital and support the growth of the mining industry in South Africa and the wider continent.’ By Patrick Farrell Image: Gallo/Getty Images