Glencore makes $131 billion ASX debut in Australia as mining giant looks to close valuation gap with BHP

Glencore will make its $131 billion Australian share market debut on Wednesday, betting local investors will help close its valuation gap to BHP as soaring copper prices and volatile energy markets boost profits.

The mining and commodities trading group will start to trade on the Australian Securities Exchange by issuing up to around $5 billion of Chess Depositary Instruments (CDI) on the local market.

Each CDI will represent ownership of one share listed on the London Stock Exchange, where Glencore will retain its primary listing.

The sprawling miner hopes its ASX listing will attract large institutional investors and help close a valuation discount to rivals such as BHP Group by strengthening its local connections.

Glencore has a £69 billion ($A131 billion) market capitalisation and posted adjusted net profit of $US3.7 billion in the 2026 financial year, benefiting from higher copper prices and surging trading profits amid energy supply disruptions linked to the conflict in the Middle East.

“Volatile oil and gas markets are playing into the group’s hands,” said Derren Nathan, the Head of Equity Research at British stockbroker Hargreaves Lansdown.

“However, the driver of long-term shareholder returns is likely to remain delivery against Glencore’s strategy and growth plans, rather than the choice of listing venue.”

Australian connections

About 20 per cent of Glencore’s operating profit is sourced from Australian coal, nickel, copper and lead mines across five states.

It also trades and stores grain, cotton, oilseeds and sorghum bought from Australian farmers.

It has 16,820 employees and contractors in Australia, equal to around 10 per cent of its global workforce.

Its South African-born chief executive, Gary Nagle, spent two years living in Sydney running the company’s coal business before taking the top job in 2021.

Mr Nagle has argued the ASX listing will encourage large superannuation funds to buy more shares in Glencore, potentially pushing its valuation higher.

The listing also opens the door for Glencore to enter the S&P/ASX 200 Index, which would prompt additional buying from passive funds that automatically invest in companies included in the benchmark index.

“Natural resources is already a well-supported sector among Australian investors, so an ASX listing could generate some incremental interest and improve visibility with that audience,” said Mr Derren.

Valuation debate

Investment research firm Morningstar currently forecasts Glencore to pay total dividends of US31 cents per share in 2026, up 71 per cent from the US17 cents per share paid in 2025.

Based on Tuesday’s London trading price of £5.89, Glencore will begin trading on the ASX at about $11.17 per CDI.

Its estimated dividend yield for 2026 is 3.97 per cent on a foreign exchange-adjusted basis, including the impact of a special dividend linked to the value of its stake in agricultural business Bunge Global.

Morningstar says Glencore’s profits are more volatile than those of traditional miners because its substantial physical commodities trading business, known as its marketing division, can generate large swings in profits.

“Stronger commodity prices, led by copper, along with increased volatility and dislocations due to the Iran war, drove a very strong first half for Glencore,” Morningstar said in its assessment of the company’s results for the six months to June 30.

Trading profits from the “marketing division” more than doubled to $US3.3 billion partly due to the dislocation from the Iran war, which has rattled commodities markets since erupting on February 2.

The trading business benefits from its storage network and price volatility, securing supplies when markets are stable and selling them later at a profit.

Copper pivot

Glencore has also followed BHP in pivoting its mining and production activities towards copper. This shift across large miners is based on an outlook for limited supply and rising demand linked to artificial intelligence and the transition to clean energy sources.

“It’s a good time to be a copper miner,” said Morningstar.

“(Glencore’s) copper division EBITDA (operating profit) tripled from a year ago to $US3 billion on higher prices and volumes along with lower unit cash costs. But we think the boom times are unlikely to last.”

Its management plans to almost double its copper production by 2035, with unfashionable coal still normally its largest profit generator from mining operations.

The company’s focus on coal has attracted environmental criticism, while parts of its global mining business have also been the subject of investigations by the US Department of Justice.

One large Australian institutional fund manager said Glencore shares look “reasonably cheap” versus its ASX-listed mining peers including BHP, but declined to comment publicly because the fund could actively trade the shares following this week’s listing.

Rio Tinto merger attempt

Glencore’s decision to list on the ASX comes after Pilbara iron ore miner Rio Tinto dismissed activist pressure to switch its own primary share market listing from London to Sydney in 2025.

“It’s worth remembering that London remains one of the world’s leading markets for global mining companies, with a deep pool of capital and investors who are very familiar with the sector,” said Mr Nathan.

In February 2026, Rio Tinto management walked away from an deal to merge with Glencore in a mega-merger that could’ve been worth up to $US320 billion.

The proposed deal collapsed after Glencore shareholders sought better terms, with disagreements over the value of the two companies’ copper and trading businesses among the sticking points.

Market speculation continues that the pair could eventually merge, although Glencore’s 44 per cent share price surge in 2026 has made a potential deal more expensive for Rio Tinto.

“A Rio Tinto-Glencore merger has obvious strategic attractions on paper, but the practical hurdles are enormous and there’s nothing to suggest a deal is imminent,” said Mr Nathan.

“For now, investors are likely to pay far more attention to operational performance and delivery against strategy than to potential merger and acquisition speculation.”