ASX Market Cap Report
Written by Heidi Gaussen, Principal Analyst, ASX
The Australian Securities Exchange (ASX) is currently undertaking a review of its market for Mid-Cap, Small-Cap and Micro-Cap securities. There is a particular focus on meeting the needs of Australia’s many listed resource-sector companies.
Around 900 of the 2,247 listed companies on ASX as at 30 June 2011 are from the metals, mining and energy sector, with most based in Western Australia. A large proportion of these companies are modestly-sized.
The Australian equity market has a history of supporting emerging industrial companies and mineral exploration ventures. It’s needed to. Australian banks don’t typically extend finance for non-mortgage backed and speculative ventures, and there is a lower level of venture capital in Australia than in the US (although this disparity has reduced due to the impact of the global financial crisis in the US). As a result of these factors and Australia’s many mineral and resource deposits, ASX is home to a large number of mining and oil and gas exploration and production companies who seek an ASX listing to raise vital capital.
The top 5 per cent of companies listed on ASX represent 80 per cent of market total market capitalisation. Companies capitalised under $100 million, generally regarded as small caps, represent 70 per cent of companies by number, but total only 2.5 per cent of market capitalisation. They make up a large and critical part of ASX’s customer base. And represent attractive opportunities for investors.
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Richard Murphy, General Manager Equity Markets, said: “The model for small listed companies in Australia is a good one, but it is based on a ‘one-size-fits-all’ approach, where listing and trading rules are the same for all companies. It is important that we keep testing that model and, where needed, improve it to meet the evolving needs of small companies and keep ASX and Australia at the forefront of the very competitive global market for company listings. ASX is working hard, via initiatives such as the SME review, to improve liquidity, price discovery and access to capital for ASX listed standards.”
ASX is currently considering feedback to the review from market users. In late 2011, ASX will release details of proposed reforms for public comment. Murphy hopes to start implementing changes in 2012.
Timeline: India takes unicorn leap with six in five days
We chart an historic week in India’s tech industry, where in just five days, between 5-9 April 2021, the country achieved six new unicorns, bringing India’s total to 10 in 2021 to date, an immense unicorn leap from just seven in 2020 and six in 2019.
April 5: Meesho
India’s first social commerce unicorn, Meesho raised US$300m from SoftBank, Facebook and Shunwei Capital, giving the Bangalore-based startup a US$2.1bn valuation, a threefold jump from its previous funding round in 2019. Founded in 2015 by two IIT-Delhi graduates, Meesho connects producers and resellers, helping small businesses sell through social media. It has 45m customers and has enabled 13m entrepreneurs to start their online businesses with no investment.
April 6: CRED
Founded just over two years ago, Bangalore-based credit card repayment app CRED raised US$215m from Falcon Edge Capital and Coatue, nearly trebling its valuation to US$2.2bn from its January US$80m round. Allowing customers to pay off their credit card debt while earning CRED coins which they cash in for rewards, CRED has grown rapidly during COVID-19, doubling its customer base to nearly 6 million in a year.
April 7: API Holdings / Groww
The first epharmacy startup to gain unicorn status, PharmEasy (API Holdings), which has digitised 60,000 brick and mortar pharmacies and 400 doctors across India, raised US$350m in a round led by Prosus Ventures. Founded by four former Flipkart employees as a way of making investing simple, investment platform Groww became India’s second-youngest fintech unicorn, raising US$83m in Series D funding led by Tiger Global, quadrupling its previous round in September.
April 8: ShareChat
New Delhi-grown social media startup ShareChat, founded in 2016 by Mohalla Tech raised US$502m from Lightspeed Ventures, Tiger Global, Twitter and Snap taking its raised total over six rounds to US$766m and pushing its valuation to US$2.1bn. The funding will be used to grow its user base and short video platform Moj, which launched in 2020 following TikTok’s ban in India. The regional language startup claims 280m users.
April 9: Gupshup
AI-led conversational message startup joined the unicorn club after raising US$100m from Tiger Global giving it a ten-fold valuation of US$1.4bn. The smart messaging platform, which has seen accelerated growth during the pandemic, was founded in Bangalore in 2005 by serial entrepreneur Beerud Sheth, whose online freelancing platform Elance is now listed. Gupshup’s API enables 100,000+ businesses to build messaging and conversation experiences across 30+ communication channels.