One place is determined to be Jakarta
Editor’s note: This article is from English station KrASIA, authorKhamila Mulia & Cindy Silviana, original title Tokopedia’s IPO will pave the way for Indonesian tech companies to follow suit< /span>
Tokopedia’s development has entered its second decade. Bloomberg reported that the Indonesian largest e-commerce website is currently undergoing pre-IPO round financing negotiations.
It is reported that Tokopedia is considering listing in two places, one of which has been identified as Jakarta. The report quoted Tokopedia as saying that Tokopedia wanted its users and businesses to become shareholders.
Tokopedia co-founder and CEO William Tanuwijaya recently expressed interest in seeking an IPO. However, he did not introduce the specific timing of the company’s IPO. Tanuwijaya said that Tokopedia has been growing positively, and the company’s goal next year is to achieve profitability, which is expected to break even in 2020.
Sebastian Tobing, head of research at Trimegah Securities, believes that a company must be clearly defined before it goes public. He is confident in the direction of Tokopedia.
Tobing tells 36 氪 English station KrASIA: “From the company’s past records, I think that Tokopedia will achieve profitability after achieving one or two years of balance. The company’s growth is considerable and the Indonesian market is becoming more mature. I believe that Tokopedia will be the leader in this industry.”
Listing in both places
Kresna Sekuritas Analyst Etta Rusdiana Putra said that listings between the two places would be more beneficial to Tokopedia. If Tokopedia is only listed in Indonesia, the company attracts a limited number of investors. If you can list on the international stock exchange at the same time, attract investmentThere will be more people. He also pointed out that international investors are more familiar with the stock market.
He pointed out that the listing of the two places is not new for Indonesian companies. For example, Telkom Indonesia has listed on the New York Stock Exchange and the Indonesia Stock Exchange.
Putra said: “Compared with the US market, the total market value of the stock market in Indonesia is still very low, so foreign institutions entering the Indonesian market are limited. The daily trading volume of the Indonesian stock market is only 8 trillion rupiah (about 568 million US dollars, 4.03 billion yuan).”
Tobing agrees with this view, “For example: Shoppee and Garena’s parent company, the SEA Group, listed on the New York Stock Exchange is the best reference for IPOs in technology companies. I think investors on the New York Stock Exchange are already very Learn about large technology companies. They are familiar with the metrics of these companies and are more likely to educate investors in this market.”
At present, there are very few large listed companies in Indonesia, especially in the technology and digital sectors. Investors are less confident in the Indonesian market than in the US market. Therefore, the listing of the two places may make local investors more optimistic about the company.
Impact
The Indonesian government, through IT Minister Rudiantara, encouraged the Unicorn Company to be listed in the country before it has grown into a ten-horned beast company (a technology company with a market value of more than 10 billion US dollars). Domestic retail investors absorb funds in their hands. At the same time, Rudiantara also told local media that companies with a market capitalization of more than $10 billion are listed on multiple locations because of the large size of such companies’ stock offerings, which may not be fully digested by local investors.
Mevira Munindra, head of Indonesian operations and consulting at IDC Indonesia, said the government hopes that the listing of the Unicorn will be understandable because it will attract local investors to contribute to the capital market and thus drive the growth of the digital economy. However, before deciding to go public, companies must be well prepared to avoid failure. She cited an example of the failure of the WeWork IPO.
Munindra told 36 氪 English station KrASIA: “Other technology companies, such as Uber and Lyft, are in a tough situation when opening an IPO. The risk for technology companies is that their business model is not 100% Market inspection and verification. Therefore, it is best to take into account all the possibilities related to operating models and business models, including good corporate governance.”
As for Tokopedia, MunIndra believes that the company will continue to influence the development of small and medium-sized enterprises and business growth in the future. “Tokopedia is an influential brand in Indonesian minds. Tokopedia is now not only an e-commerce company, but also a promoter of the digital ecosystem, working closely with stakeholders in the digital and non-digital markets.”
Like the Indonesian government, Tobing also believes that if the unicorn company goes public, it will have a positive impact on the Indonesian digital economy.
He said: “From a revenue perspective, the digital economy is growing rapidly, and this is even the fastest growing industry in Indonesia. The benefit of an IPO is that the public will have the opportunity to participate in the digital economy and develop from the unicorn company. Benefit from it. In this way, we can grow together.”
In addition, Tobing is optimistic that Tokopedia will be able to successfully list on the stock market, which in turn will attract other unicorn companies and even mid-sized technology companies to follow suit. In the long run, it will promote the development of the digital economy in Indonesia.
Tokopedia currently has more than 90 million monthly users. According to a recent report by the University of Indonesia’s Institute of Economics and Society, Tokopedia’s GMV was $5.1 billion in 2018 and is expected to more than triple this year, reaching $15.6 billion, equivalent to 1.5% of Indonesia’s total economy. %, the influence of Tokopedia can be seen.
This report also states that the unicorn company expects to contribute $12 billion to the Indonesian economy by 2019. In addition to increasing the total amount of national transactions, Tokopedia is also expected to create a large number of jobs, increase business income, and achieve broader economic equality across Indonesia.
CB Insights data shows that in December 2018, Tokopedia had a valuation of about $7 billion, making it the second-largest startup in Indonesia, second only to Gojek. CB Insights points out that as Tokopedia’s total turnover and number of buyers continue to grow, Tokopedia has the potential to become the second ten-corner company in Indonesia.
In an interview with the 36-year-old English-speaking KrASIA, Tokopedia spokesperson Nuraini Razak said: “Large companies like Tokopedia want to go public. However, we can’t disclose more details about the company’s IPO plan.”
Translation | Qian Gongyi@熊猫译社
编 | 令晨@出海
图 | Oriental IC
