Diverging IPO fortunes of two Asian logistics giants

Opening Bell 🔔 is Tech in Asia’s free newsletter that brings you the biggest news and latest trends around Asia’s publicly listed tech companies. [Read from your browser]( Opening Bell 🔔 Welcome to the Opening Bell! Delivered every Monday via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and latest trends on Asia’s publicly listed tech companies. If you’re not a subscriber, get access by [registering here](. --------------------------------------------------------------- Written by Shravanth Vijayakumar Journalist Hello {NAME} As economies around the world look to cool off amid red-hot inflation, Southeast Asia’s digital economy is steaming ahead, [reaching]( US$200 billion in gross merchandise value (GMV) in 2022 – three years earlier than expected. This figure could skyrocket to as much as US$1 trillion by 2030. Ecommerce remains the digital economy’s biggest driver of growth, contributing US$131 billion in GMV this year. Moreover, the sector is still relatively nascent in Southeast Asia, with 100 million of the region’s more than 460 million internet users just coming online over the past three years. Coupled with Southeast Asia’s increasing mobile penetration, it is little wonder that VCs are confidently [making bold predictions]( such as claiming “the shift to online is inevitable.” However, ecommerce needs more than just a sound internet connection to boom. Logistics is the backbone of any ecommerce ecosystem but hardly grabs the spotlight as it’s usually just a means to an end for the end consumer. Personally, tracking my food order on delivery apps is the only kind of logistics that excites me. Nonetheless, the more than hundred logistics players and enablers in Southeast Asia play a key role in keeping online services afloat and the supply chain from crumbling. That brings us to two logistics titans that are vital cogs in their respective markets: India’s Delhivery (DELH, NSE) and Hong Kong-headquartered GogoX (2246, HKG). In today’s featured piece, my colleague, Simon, highlights the contrasting fortunes faced by these two firms after their public listings earlier this year. From the repercussions of rich valuations to the headwinds of the markets they operate in, the premium story touches on a host of factors to dissect why GogoX’s shares have fallen off a cliff while Delhivery has managed to keep the boat steady - at least until a lackluster quarterly report undermined a healthy start in public markets. -- Shravanth  ---------------------------------------------------------------  THE BIG STORY [GogoX and Delhivery: A tale of two logistics IPOs]( Differences in valuations and listing venues are key to explaining the diverging performances of two logistics IPOs this year.  ---------------------------------------------------------------  3 TRENDS TO KEEP AN EYE ON Hot stocks, earnings reports, restructuring, pressure from activist investors, and more. 1️⃣ Stellar earnings justify Indonesia’s digibank dash?: The sheer number of firms looking to provide online banking services to the legion of tech-savvy folk in the archipelago has never failed to astound me. Earlier this month, Southeast Asia’s second-biggest bank, Oversea-Chinese Banking Corp (OCBC, SGX), threw its hat in a packed ring which includes the likes of Akulaku, GoTo Group (GOTO, IDX), Sea Group (SE, NYSE), and Bukalapak (BUKA, IDX), along with a host of mainstream banks with a strong digital presence.  See also: [The tech companies bankrolling Indonesia’s digital banks]( For most part, I’ve struggled to grasp the hype, but that was until the promising results from Gojek-backed Bank Jago (ARTO, IDX) and BTPN Syariah (BTPS, IDX) last week. For starters, Bank Jago [doubled]( its revenue in the third quarter and even managed to squeeze in a profit despite an uptick in expenses. The firm’s loan disbursements also grew over 2x year on year, with about a third coming from its Shariah unit. Meanwhile, a Shariah-compliant bank that focuses on women entrepreneurs, BTPN Syariah, [bagged]( a US$30.3 million third-quarter profit on the back of a 21% year-on-year jump in revenue. 2️⃣ Grab (GRAB, NDAQ) making moves with adjusted EBITDA target in mind?: It seems that the Southeast Asian ride-hailing and food delivery giant is working toward its [goal of hitting]( breakeven on an adjusted-EBITDA basis in the second half of 2024 by cutting off businesses that weigh on its balance sheet. The tech titan will be shutting down its cloud kitchen operations, GrabKitchen, in Indonesia on December 19 after four years. As of 2020, GrabKitchen had footprints in 48 locations across Indonesia. While keeping in line with the firm’s [assurance]( that it will avoid mass job cuts, the move, however, affects around 10 to 20 Grab employees. Some were offered transfers to other divisions while others were laid off.  Read more: [Grab’s financial arm takes center stage at its investor day]( To suddenly lose a regular source of income is undoubtedly a distressing situation for salaried employees. Luckily, conversations around mental wellbeing are gaining traction in modern society. In [this Tech in Asia podcast]( my colleague, Winston, sits down with Joyce Lim, an HR lead at Grab, to talk about how the Singapore-based company helped its staff navigate their way through the mental health challenges posed by Covid-19 and the role of employers in providing invaluable mental health support to their employees. 3️⃣ The shifting gears of the IPO market: The demand for public listings was due for a breather after about a decade of the bull market. While successful IPOs have been hard to come by this year, given the dire macroeconomic climate, several firms are still working toward a stock market debut in the medium term. One such company is womenswear label Love Bonito, which is currently carrying out an ambitious international expansion and has plans to open a US store in 2023, with the eventual aim of listing in the country. This [Tech in Asia premium story]( shows how the Singapore-headquartered firm is working toward that goal by building a ecosystem beyond fashion for women. Meanwhile, Indonesian unicorn Blibli is anticipating a US$3.5 billion valuation in a market debut set for November 7 on the local exchange. The ecommerce firm’s parent, PT Global Digital Niaga, has [opted]( to further offload its stake through the listing after upping its quota for sale to 17.8 billion shares at US$0.029 each from the earlier 11.2 billion shares at US$0.026 to US$0.03 apiece. Lastly, Imagine Marketing, the parent company of India-based digital-first brand boAt, has dropped IPO plans amid tough market conditions. Instead, the firm will [raise]( a little over US$60 million via a private placement of preference shares at a valuation of US$1.4 billion to fuel its growth plans.  ---------------------------------------------------------------  2 EYE-POPPING FACTS Tech in Asia scours the internet to bring you head-turning numbers from the world of business. [1,925%]( - That’s how much AirAsia parent Capital A (CAPI, KLSE) said passenger footfall shot up in the third quarter of 2022 from a year ago, operating 68 aircraft during the period. Impressively, the company’s super app also reported a 161% rise in average monthly active users to 9.5 million users in the quarter. [43x]( - This figure reflects the jump in the number of credit assessments done in 2021 by Tokoscore, Tokopedia's credit-scoring arm, when compared with the previous year. This premium story highlights how Tokopedia, GoTo's ecommerce unit, can leverage Tokoscore to beef up its loan books and reduce non-repayments for not just its parent firm but also for third parties. --------------------------------------------------------------- THE ONE YOU DIDN'T SEE COMING We spotlight the unusual, not-your-everyday kind of story that had everyone talking and social media buzzing over the past week.  Virtual stars make this 26-year-old a billionaire If there was ever any doubt that virtual influencers can be just as effective as real ones, just take a look at the fortunes of Anycolor Inc (5032, TYO), the talent agency that manages the humans behind those avatars. The shares of the Japan-based firm have jumped 8x since debuting in June, pushing its valuation up to US$2.5 billion. As a result, Anycolor [produced]( one of the youngest billionaires in its founder, 26-year-old Riku Tazumi, who owns a 45% stake in the company. In its earnings report last month, Anycolor, which currently manages about 140 creators, almost tripled its year-on-year operating profit for the three months to July.  --------------------------------------------------------------- That’s it for this edition - we hope you liked it! Not your cup of tea? You can unsubscribe from this newsletter by going to our preference center at the bottom of this email. Happy investing and see you next week! Disclaimer: This content is for informational purposes only. Kindly do not construe any such information as legal, tax, investment, financial, or other advice. [ADVERTISE]( | [SUBSCRIBE]( | [HIRE]( | [FIND JOBS]( P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? Switch to a different frequency or get new content through our [preference center]( or [unsubscribe](. 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