Star Southeast Asia unicorns see $51bn gone since listings

Bloomberg

Global investors who put their faith in three of Southeast Asia’s high-profile tech startups are facing a grim reality that’s seen the firms lose $51 billion in value in the past year-and-a-half since their equity debuts.
Singapore-based ride-hailing firm Grab Holdings Ltd., which listed in New York about a year ago, has shed over 70% of its market value. It was Southeast Asia’s most valuable startup at the time it merged with Altimeter Growth Corp., the blank-check firm of Brad Gerstner’s Altimeter Capital Management. Grab lured more than $4 billion from investors including BlackRock Inc., Fidelity International and T. Rowe Price Group Inc.
PT GoTo Gojek Tokopedia, Indonesia’s largest initial public offering this year, and PT Bukalapak.com, which listed in 2021, have plunged 74% and 69%, respectively, since their first day of trade in Jakarta following widely-expected IPOs. Both companies underperformed local benchmarks and about a 30% drop in the Nasdaq 100 since the start of the year.
Grab is now worth $11.6 billion, Bloomberg data show. While the stock trimmed some losses since it announced it narrowed losses in the third quarter as revenue beat expectations, investors remain skeptical of when it may reach profitability.
The Southeast Asian newcomers join a slump engulfing recently-listed Indian startups as investors question their high valuations. The three firms offered investors an exposure to Southeast Asia’s booming e-commerce sector at a time when traders were still eager to snap up growth stocks. But rising interest rates globally and risks of recession are taking a toll on technology shares.
There are also concerns that early investors will be paring their stakes after initial lockup periods end, something that happened with several companies in India. GoTo lost nearly 60% in market value over the past month amid the expiry of a lockup on its major shareholders’ stakes and as investors fret about the unprofitable Indonesian internet firm’s prospects.
GoTo has said it has enough funds to last the company until it reaches profitability.
Online marketplace Sea Ltd, another Singaporean unicorn that listed in the US back in 2017, also lost about $169 billion in market value since a peak in October 2021.
GoTo — Indonesia’s largest tech company — has lost about $22 billion in market capitalisation from a peak reached in June. The company’s IPO raised $1.1 billion and the shares soared 13% in their first day of trade in April, following what was at the time one of the world’s largest IPOs for the year.
Several tech companies that listed over the past 18 months, such as Zomato Ltd. in India and SenseTime Group Inc in Hong Kong, saw their shares plunge once early investors were allowed to sell stakes following their initial public offerings.