Key facts
- Glencore plans a secondary listing on the Australian Securities Exchange in October.
- The company aims for inclusion in the S&P/ASX 200 index within 12 months.
- Analysts believe Glencore could join the S&P/ASX 100 index much sooner, potentially by April.
- About 30% of Glencore's profit currently comes from copper, with potential to reach 50% by 2030.
- Some resistance is expected due to Glencore's reliance on thermal coal for about 15% of its earnings.
Glencore is planning a secondary listing on the Australian Securities Exchange (ASX) in October, aiming to attract institutional capital for its copper growth initiatives. Analysts and investors suggest that the company's strong copper prospects may overshadow concerns regarding its significant thermal coal exposure, potentially leading to rapid inclusion in key Australian market indices.
Brokers such as JPMorgan, Barrenjoey, and UBS have conducted investor briefings on the proposed listing, which have been well-attended. Glencore CEO Gary Nagle anticipates the company could be included in the S&P/ASX 200 index within a year, requiring a market value of A$1.5 billion. Analysts, however, believe momentum could propel Glencore into the larger S&P/ASX 100 index as early as March or April next year, provided it achieves sufficient liquidity and market capitalization.
Australian investors have shown increasing comfort with secondary listings via CHESS Depositary Interests (CDIs), with the number of metals and mining CDIs on the ASX growing significantly since 2020. Glencore's appeal is partly driven by copper, which constitutes about 30% of its current profits and is expected to rise to 50% by 2030 due to demand for electrification and AI. Despite this, Glencore's reliance on thermal coal for approximately 15% of its earnings could present a hurdle for some ESG-focused funds. However, recent data from the Responsible Investment Association Australasia indicates a softening in the emphasis on environmental concerns among some funds, though demand for coal exclusions is expected to grow as wealth transfers to younger generations.