GoTo announces IPO, expected to raise USD1.1 billion from investor

Jakarta, Gizmologi – PT GoTo Gojek Tokopedia officially announced its plan to carry out an initial public offering (IPO) on Indonesia Stock Exchange (IDX).

The IPO is expected to raise proceeds of at least IDR 15.2 trillion (USD1.1 billion) and will be one of the most significant ever conducted in the country.

It is planned that all proceeds from the IPO will be used to strengthen working capital and increase investment in subsidiary companies.

This certainty was explained by GoTo in a virtual public expose. The technology giant said it would use working capital from the initial public offering to support the company’s future development.

“The Issuer and Subsidiaries will use the working capital to support the Company’s development strategy through various initiatives, including but not limited to customer acquisition; sales and marketing; product development such as feature additions, technology updates, and new product/technology innovations; and operating expenses,” said the CEO GoTo Andre Soelistyo Group, Tuesday (15/3/2022).

In detail, GoTo will allocate 30% of the IPO proceeds by the company. Where 25% of the funds will be allocated to PT Dompet Anak Bangsa (GoPay). Around 5% of the funds will be allocated to PT Multifinance Anak Bangsa (part of GoToFinance).

GoTo also plans to allocate around 5% of the proceeds from the IPO for VDIGI SG Ltd. (Gojek Singapore) and around 5% for Go Viet Ltd. (Vietnamese Gojek).

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“The issuer will increase its investment in Tokopedia, PT DAB, PT MAB, VDIGI SG Ltd., and Go Viet Ltd. step by step. Every equity investment in Tokopedia, PT DAB, PT MAB (formerly PT Rama Multi Finance), VDIGI SG Ltd. and Go Viet Ltd. is an affiliated transaction with an affiliated party as regulated in POJK No. 42/2020,” he explained.

Andre said that the company’s business strength is that GoTo is more than just a group of companies. The company’s on-demand, e-commerce, and financial technology service ecosystem connect millions of consumers, driver-partners, and merchants, with the mission of driving progress for everyone in the midst of the fast-growing digital economy.

“We are proud that from our humble beginnings, we have earned the trust of millions of consumers, driver-partners, and traders, and are supported by various leading global investors and are currently taking the next step to becoming a publicly listed company in Indonesia,” he explained.

GoTo Contributes to the Indonesian Economy

President Commissioner of PT GoTo Gojek Tokopedia Tbk Garibaldi Thohir claimed that the company resulting from the merger of Gojek and Tokopedia contributed two percent to the country’s economy. The services available in the GoTo ecosystem have provided benefits for Gojek, Tokopedia, and Gopay service users as well as millions of driver-partners and MSME actors.

“Alhamdulillah, GoTo has such a big impact that we are able to contribute almost two percent to the Indonesian economy,” he said in the public expose.

Garibaldi said that this contribution to the Indonesian economy was due to the hard work of Gojek and Tokopedia, which were founded 11-12 years ago. GoTo’s belief in being able to facilitate people’s lives through technology will provide opportunities for everyone to improve their quality of life.

“We hope that the GoTo IPO will be a proud moment and signify a new achievement for the listing of shares in the domestic technology sector, as well as reflecting optimism for the recovery and strengthening of the Indonesian economy,” he concluded.

As is known, GoTo is a unique ecosystem that combines on-demand services, e-commerce, and financial technology through Gojek, Tokopedia, and GoTo Financial platforms. Based on Euromonitor 2020 data, the existence and reach of the GoTo ecosystem are able to contribute more than 2 percent of Indonesia’s GDP and serve almost two-thirds of household consumption in Indonesia.

GoTo IPO Key Takeaways

Garibaldi Thohir, President Commissioner GoTo

GoTo emphasized leadership on:

a. on-demand (mobility, food delivery, logistics),
b. e-commerce (marketplace, Official store, Tokped Now, Mitra Tokped, Tokped Play,
c. fintech with goto financial (payments, financial services, merchant solutions).

GoTo emphasizes on the integration of those three.

Key headline numbers:

– 55 million users (ATUs),

– LTM Sept ‘21 GTV Rp414tn, corresponds to 2% of Indonesia’s GDP

– 14mn registered merchants

– 2 billion processed orders

– 2.5mn partner drivers,

– GoTo access to 638mn SKUs

Key points from presentation:*

– 1. Strong synergy 2.5mn driver-partners, 14mn merchants, working in a close loop with 55mn consumers. This is supported by its own logistics & fulfillment, merchant solution, payment & financial services, data insights, and network effects.

– 2a. GoTo fulfills the consumer needs with a number of verticals: with goride, Tokopedia, gopay, Tokopedia Now, Gocar, gofood, gosend, gopay coins, gotagihan, gopulsa, gopaylater, adding value in the unified loyalty program, personalized and innovative offerings, credit scoring. GoTo argues that use cases are unmatched by the competition. This ecosystem will preserve retention and loyalty.

Cost optimization. Effective marketing. GoTo promotes gopay, tokopedia, delivery in one go.

– 2b. Hyperlocal strategy is key for GoTo.*Its made possible to run the fulfillment of merchants’ products and have faster deliveries with the availability of dark stores, cloud kitchens, and the largest fleet of drivers (vans, motors, etc). Tokopedia NOW is a case in point for groceries.

– 3. Portfolio of fintech services that include digital payment methods, financial services. GOPAY will be the main access platform for all its fintech.*

– 4. One-stop-shop merchant solutions with SaaS and IaaS for each F&B, retail, eCommerce, and MSME type of business.

– 5. The current times offer the best opportunity for investment in digital adoption to be a leader in the future. New consumers from Covid19, increased buying and paying frequency, lifestyle change. On-demand market penetration is ~5% and Gojek is a leader. Ecommerce penetration is 6% and Gojek is the leader, e-wallet penetration is 2.9% and gotofinancial is leader.

– 6. Stressing the GoTo global identity that can source talents from Singapore, India, Vietnam, and Indonesia, and with support from its giant tech and VC shareholders.*

– 7. ESG Commitment with zero-emission and zero waste targets.* Also aims zero barriers friction within GoTo organization, incl. gender equality and Gotong Royong program.

Some key financials:

– 3Q21 GTV Rp120.7tn (+62%yoy)

– 3Q21 Gross revenue Rp4.5tn (+55%yoy)

– Sept 2021 LTM EBITDA -Rp7.8tn (-79%yoy). (It includes only 4.5months of Tokped).

– Sept 2021 LTM EBT -Rp12.3tn (-124%yoy). (It includes only 4.5months of Tokped).

The Indonesian version of this article can be read in Gizmologi.ID