South Africa's ruling ANC awaited the imminent confirmation on Saturday that it had lost its three-decade-old absolute majority and would have to find allies if it is to remain in power.

With more than 98 percent of the votes from Wednesday's election counted, President Cyril Ramaphosa's African National Congress had only 40.15 percent support, a catastrophic slump from the 57.5 it won in 2019.

This marks an historic turning point for South Africa as the party has enjoyed an absolute majority since 1994, when liberation leader Nelson Mandela led the nation out of white-minority rule and into democracy.

"We have been talking with everybody even before the election," ANC's deputy secretary general Nomvula Mokonyane told AFP on Friday, saying the party's decision-making body would set the course to follow after final results are announced.

"Anything must be based on principles and not an act of desperation."

As votes continued to be validated, data from the Independent Electoral Commission (IEC) showed the centre-right Democratic Alliance (DA) held second place with 21.71 percent, slightly up on its 20.77 showing in 2019.

But it was not a surge by the DA that cut into the ANC's vote share.

In third place was former president Jacob Zuma's uMkhonto weSizwe (MK) on 12.6 percent, a surprise score for a party founded just months ago as a vehicle for the former ANC chief.

The radical leftist Economic Freedom Fighters (EFF) was in fourth with 9.4 percent.

The final results were to be formally announced on Sunday, but the IEC results website was being updated through the day and with the result no longer in doubt, politicians were turning their attention to the prospects of an ANC-led coalition.

- No pardon, no party -

The ANC has dominated South Africa's democracy with an unbroken run of five presidents from the party, but if President Cyril Ramaphosa is to remain at the helm he will have to decide whether to seek allies on his right or left.

There will be resistance within his movement to a tie-up with the second-placed DA, under white politician John Steenhuisen, whose free market programme of privatisations and an end to black economic empowerment programmes sits at odds with the ruling party's traditions.

Mandela's grandson, Mandla Mandela, an outgoing ANC lawmaker, told AFP the DA held "different ideals" making it too difficult to partner with.

The radical left groups led by former ANC figures: firebrand Julius Malema's EFF or Zuma's MK, were more likely bedfellows, he said.

But these options might also meet resistance within the more moderate sections of the ANC.

Analyst and author Susan Booysen, said the EFF was perceived as "too erratic" and "unpredictable" in its demands.

And the rift between Ramaphosa and Zuma -- who has long been bitter about the way he was forced out of office in 2018 -- was "too far reaching" to mend, she said.

MK spokesman Nhlamulo Ndhlela seemed to agree. "We will engage with the ANC but not the ANC of Cyril Ramaphosa," he said.

Any coalition partner should be willing to amend the constitution to enact radical reforms and grant Zuma, who has been declared ineligible over a contempt of court conviction, a pardon, he said.

But Mokonyane dismissed the notion that Ramaphosa's leadership was at risk, saying: "In the ANC we don't work that way. It's not a presidential election. It was an election that the ANC went in as a party and we are happy with it."

The ANC retains the loyalty of many voters for its leading role in overthrowing white minority rule.

Its progressive social welfare and black economic empowerment policies are credited by supporters with helping millions of black families out of poverty.

But over three decades of almost unchallenged rule, its leadership has been implicated in a series of large-scale corruption scandals, while the continent's most industrialised economy has languished and crime and unemployment figures have hit record highs.