Surpass Singapore's Grab, Indonesia's GoTo is Now Southeast Asia's Most Valuable Startup
Grab Holdings Ltd., formerly Southeast Asia's most valuable company, is struggling to catch up to GoTo Group in the stock market as it competes to expand on the territory of its Indonesian ride-hailing rival.
Grab Holdings announced a better-than-anticipated 79 percent gain in revenue, helped by consumers' steadfast demand who continued to purchase food and call rides despite growing inflation.
The Singapore-based company reported in a statement on Thursday that revenue increased to US$321 million in the second quarter. That exceeded the average expert forecast of US$273.1 million gathered by Bloomberg.
After spending years engaged in an expensive struggle for regional hegemony, Grab's net loss shrunk to approximately US$547 million as it tries to cut down on cash burn.
Following their recent stock market debuts, both companies are having trouble persuading investors of their ability to make money. However, GoTo's decline has been less pronounced than that of its rival, and its market value of roughly $26 billion is currently double that of its Singaporean rival. In the upcoming days, each company will present its quarterly earnings.
Since it went public through a merger with a US blank-check company last year, Grab, founded by Anthony Tan, has struggled.
Since then, its shares have lost more than 60% of their value as losses accumulated from lockdowns during the pandemic and investors lost interest in losing businesses.
Now that inflation is on the rise and might potentially reduce demand, Mr. Tan must manage this period while Grab works to overcome its difficulties with Covid.
In contrast to its prior projection of US$1.2 billion to US$1.3 billion, Grab stated this year's revenue is anticipated to be between US$1.25 billion and US$1.3 billion.
In contrast to its earlier projection of 30 to 35 percent growth, the company now expects its gross merchandise value to rise 21 to 25 percent this year.
Grab, formerly Southeast Asia's most valuable start-up, is struggling to catch up to GoTo Group on the stock exchanges as it battles for market share against its Indonesian ride-hailing rival there.
After staging their stock market debuts in recent months, the underperforming companies are both having trouble persuading investors of their ability to make money.
However, GoTo has suffered less of a decline than its rival, and with a market valuation of roughly US$26 billion, it has surpassed its Singaporean rival.
Over the past many years, Grab and GoTo have been engaged in an expensive power struggle. Even while it works to develop in nations like Indonesia, Southeast Asia's largest economy, Grab still views the city-state of Singapore as its single largest market.
In its home country of more than 270 million people, GoTo is enjoying a dominant position. Its tech-savvy mobile customers shop on its online retail platform Tokopedia and order rides and food through its Gojek app.
GoTo has outperformed Grab, which in December merged with Brad Gerstner's Altimeter Growth Corp. to become a publicly traded business, thanks to the growth potential of Indonesia.
Grab is down more than 60% since merging with the US blank-check company, while GoTo has lost approximately 3% since its initial public offering in Jakarta in April.
According to a July 20 report by Bloomberg Intelligence analyst Nathan Naidu, "GoTo's advantage as a homegrown Indonesian brand and its synergy with Tokopedia may let the country's biggest tech firm defend food-delivery market share from Grab, the category's leader in Southeast Asia, and improve profitability."
While Grab has made progress in the food delivery industry, Gojek still dominates the vital Indonesian market. Momentum Works estimates that Grab has 49% of the Indonesian food delivery market last year, while GoTo had 43%.
Source: Bloomberg.com, StraitsTimes.com