Jakarta. GoTo Gojek Tokopedia, an Indonesian technology company formed from the merger between ride-hailing giant Gojek Indonesia and e-commerce firm Tokopedia, announced its plan to raise up to $1.26 billion in one of the largest initial public offerings in the Indonesian stock market.
In a prospectus published on Tuesday, the company said that it would issue a maximum of 52 billion Series A shares, the equivalent of 4.35 percent of its enlarged capital at Rp 316-346 per share. The plan would net the company Rp 17.99 trillion ($1.26 billion).
GoTo will start the book building today until Mar 21. The company targeted targets to obtain an effective statement from the Financial Services Authority (OJK) on Mar 25. The public offering is scheduled for March 29-31 and shares listing on IDX on Apr 4.
GoTo will also conduct a serial rights issue for ten years after the effective date. GoTo will flush the market another 1.5 percent per year in each rights issue. GoTo will also sell ten percent of its enlarged capital on exchanges outside Indonesia. The management is still reluctant to mention which global stock market.
One of the Largest
Should GoTo meet its IPO target, it would be the second-largest initial offering in Indonesia's stock market in history, just below last year's Bukalapak IPO. The e-commerce company, founded by Achmad Zaky Achmad Zaky, Nugroho Herucahyono, and Fajrin Rasyid, raised Rp 21.9 trillion from the offering that saw an influx of domestic retail interest in the stock.
Still, Bukalapak's share price has dropped 73 percent since its listing date. GoTo seemed adamant to avoid a similar fate. So, it said that it had the lead underwriter in its offering, CGS-CIMB Sekuritas Indonesia, keeping 7.8 billion shares, which it will use to stabilize GoTo's stock price.
"The stabilization agent is trying to keep the share price from being lower than the offering price," wrote Goto's management.
"In connection with the initial public offering, the issuer together with the underwriters plan to stabilize prices by implementing more allotment options," GoTo management wrote in the prospectus.
GoTo also appointed Indo Premier Sekuritas, Mandiri Sekuritas,Trimegah Sekuritas, and Nilai Inti Sekuritas as underwriters. The later and CGS-CIMB Sekuritas also stand as the standby buyers in the offering.
Like Bukalapak, GoTo went on IPO with its book still in the red. The company lost Rp 8.2 trillion in the first seven months last year, a smaller loss than Rp 11.3 trillion in the same period a year earlier, according to GoTo's financial data provided by Indo Premier. The same document also projected that the company would continue to make losses until at least 2024.
Still, the company showed strong growth in its operation. The document showed that the gross transaction value (GTV) was Rp 414 trillion in twelve months ending Sep 30, 2021. In comparison, the company saw Rp 330 trillion in GTV in 2020.
Between 2018 to 2020, GoTo revenue rose 56 percent on average every year. It reported a revenue of Rp 15.2 trillion in twelve months ending Sep 30, 2021.
In terms of cost, GoTo managed to improve efficiency and reduce promotion costs to 64 percent of gross revenue in the first seven months of 2021, from 67% percent in the same month a period earlier.