Table of Contents
Key Points
- JP Morgan’s stake in Thungela grew to 6.63%, but market value dropped below $50 million due to falling coal prices and shifting investor sentiment.
- Thungela’s 2024 revenue rose to $2 billion, but net profit declined 30%, pressured by higher costs and weaker coal prices in H1 before a partial recovery.
- Despite challenges, Thungela expanded by fully acquiring Australia’s Ensham mine, supported by a strong balance sheet and assets rising to $2.7 billion in 2024.
JP Morgan Chase & Co. has seen the value of its stake in South African thermal coal exporter Thungela Resources Ltd. fall below $50 million, despite holding a current 6.63 percent stake, up from 5.21 percent over a year earlier. The decline reflects a significant pullback in Thungela’s share price amid shifting coal market dynamics and mounting valuation pressures.
The value of JP Morgan’s holding fell from R1.13 billion ($58.82 million) in September 2023 to R835.38 million ($46.97 million) as of May 2025, following a share price drop from R154 ($8.66) to R89.58 ($5.04). The move signals what could be a long-term strategic bet by the U.S. bank, even as the coal miner grapples with a volatile operating environment.
Stake grows, market value falls amid market headwinds
As of Sept. 6, 2023, JP Morgan owned 7.32 million shares in Thungela, valued at R1.13 billion ($58.82 million). By May 6, 2025, a recent disclosure showed that their holding had increased to 9.31 million shares, giving them a 6.63 percent stake. However, the value of these shares had fallen to R835.38 million ($46.97 million).
This peculiar situation — owning more shares but seeing their total worth decline — reflects the cautious mood among investors. Concerns about global moves to reduce carbon emissions and unclear policy directions have made coal stocks less attractive.
Under July Ndlovu, Thungela reported mixed 2024 financial results. Revenue rose to R35.55 billion ($2 billion) from R30.63 billion ($1.72 billion) in 2023, but net profit dropped sharply to R3.59 billion ($201.84 million), down from R5.16 billion ($290.12 million) the previous year.
The earnings decline reflected elevated costs and weaker coal prices in the first half of 2024. However, a partial recovery in the second half saw the miner post a $70.4 million profit, buoyed by cost-cutting, restructuring, and improved export pricing.
Expansion and balance sheet strength
Despite profitability pressures, Thungela has pursued strategic expansion. In late 2024, it acquired the remaining 15 percent stake in Australia’s Ensham coal mine, completing full ownership after initially securing 85 percent in February 2023.
The all-cash transaction, funded from internal reserves, underscored the miner’s robust balance sheet. As of Dec. 31, 2024, Thungela’s total assets rose 3.4 percent to R48.08 billion ($2.7 billion), up from R46.49 billion ($2.61 billion) a year earlier.
Long-term bet on coal’s resilience
Since its 2021 demerger from Anglo American, Thungela has diversified its coal portfolio and broadened its export footprint under Ndlovu’s stewardship.
Despite the current valuation decline, JP Morgan’s decision to raise its stake signals confidence in Thungela’s long-term fundamentals—anchored by a strong cash position, strategic asset base, and continued relevance in key coal-consuming markets across Asia and Africa.
With global energy demand in transition but still reliant on coal in many regions, JP Morgan may be positioning itself for a rebound—or viewing Thungela as undervalued relative to its earnings power and expansion ambition.
