Source: GoTo Image

When Will GoTo IPO?

GoTo will IPO in Indonesia stock exchange on 11 April 2022.

The allocation date for those who have subscribed is tomorrow on 7 April 2022 while the allocation of the shares electronically is on 8 April 2022.

11 April 2022 will be the first day that GoTo will go public in IDX.

You can see GoTo IPO Prospectus here.

Source: GoTo IPO Prospectus

GoTo is combining e-commerce (Tokopedia), on-demand (Gojek) and financial services (Goto financial) to become a strong platform in Southeast Asia.

GoTo ecosystem encompasses around 2% of Indonesia’s GDP and continues to expand, serving Indonesia’s 270 million consumers and other emerging markets across Southeast Asia.

As of 30 September 2021, they have over 14 million merchant partners and 2.5 million drivers.

The Financials of GoTo

Source: GoTo IPO Prospectus

Based on the information in the IPO Prospectus, the largest shareholders of GoTo is Sequoia Capital India at 20.70% followed by Indonesia’s education minister and GoTo Co-Founder, Mr. Nadiem Anwar Makarim at 20.50%.

Other backers of GoTo includes Alibaba, Astra, BlackRock, Capital Group, Facebook, Google, KKR, Softbank Vision Fund 1 and Temasek.

Source: GoTo IPO Prospectus

Based on what we can see above, huge increase in the asset from 30,108,570 m rph to 148,212,737 m rph is due to the increase in 93,873,046 m in goodwill, probably due to the merger.

An increase in asset due to goodwill gives it the chance of future write-downs, if the value of the company decrease in the future.

Source: GoTo IPO Prospectus

It’s liabilities has also been increasing (both short and long-term liabilities) by around four-fold from 2018 to 2021.

The accumulated losses increase from 20,438,041 m rph in 2018 to 65,286,739 m rph in 2021.

From what we can see so far, it is obvious that GoTo is a company that is still looking to expand and is in a growth stage.

GoTo is planning to IPO at rp338 per share, which is a valuation of about $27.8b, raising around $1.1 b.

Source: GoTo IPO Prospectus

Based on their prospectus, GoTo’s net revenues has been increasing from 1,436,511 m rph in 2018 to 3,327,875 m rph in 2020. This is an amazing increase in sales of around 100+% in 2 years.

From 1 January to 31 July 2021, their net revenues is at 2,516,300 m rph, which if we assume they will perform the same for 2nd half of 2021, it will be at around 5,000,000 m rph – which is around $348m.

That means that at a IPO valuation of about $27.8b in IDX, the price to sales ratio based on my assumption will be around 79 times. 

If GoTo, continue to double its sales every 2 years, in another four years sales will be around $1.5b. And based on IPO valuation of $27.8b, that is around price to sales ratio of 18-19. Which in my view is still expensive.

In Summary

In summary, I think GoTo is an amazing business that is great for humanity.

I am personally a regular user of their GoFood in Indonesia and GoCar in Singapore.

And I would love to be a shareholder of GoTo one day, but hopefully at the right price.

The IPO valuation relative to it’s current sales and my future projections of its sales appear too expensive for my taste.

But let’s see how the IPO goes, I hope GoTo will still do well.

Even though I will not be a buyer of it’s IPO for now, I will definitely watch how GoTo perform over time in my watchlist.

–

PS: I really love GoTo tagline: go far, go together.

Disclaimer:

The information provided is for educational and general information purposes only and is not intended to be personalized investment or financial advice. We make no promises as to the accuracy or usefulness of the information we present.

Important: Please read our full disclaimer.

Enjoyed the article?

Share it with your friends. Thank you!