Bukalapak IPO: Indonesia Just Had Biggest Ever Listing As Southeast Asian Tech Takes Off

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Jakarta-based Bukalapak began trading on the Indonesian Stock Exchange on Friday after raising around $ 1.5 billion.

This is the largest ever recorded for this exchange, according to data provided by Dealogic. Indonesian telecommunications giant PT Telekomunikasi, also known as Telkom, raised nearly $ 1.7 billion in 1995, despite being a multiple listing split between exchanges in Indonesia, the United States. United and UK.

Bukalapak is Indonesia’s first tech unicorn, or billion-dollar private company, to debut in the market.

He valued his shares at 850 rupees (around $ 0.06). Shares climbed nearly 25% in its first trading session, signaling keen investor appetite.

Silva Halim of Mandiri Sekuritas, one of the underwriters of the deal, said the offer was already “8.7 times oversubscribed, with orders coming from nearly 100,000 investors”.

Bukalapak is now considering exercising an over-allotment option for retail investors.

“We would like to express our deepest gratitude for the tremendous support Bukalapak has received,” said Rachmat Kaimuddin, Chairman and CEO of the company, in a statement.

Bukalapak was founded in 2010 by three college friends, Achmad Zaky, Fajrin Rasyid and Nugroho Herucahyono. The Jakarta-based company has made a name for itself by partnering with Indonesian “warungs” – local mom-and-pop shops – to help customers order items online.

It has since grown into one of Southeast Asia’s best-known e-commerce players, alongside Shopee, Lazada and Tokopedia. The company is backed by renowned investors, including Microsoft (MSFT) and Standard Chartered (SCBFF).

To make a sensation

The list comes as Southeast Asian startups experience massive growth. In April, Grab, the Singaporean startup, announced it was going public in the United States in a $ 40 billion SPAC deal, the largest on record.
Malaysia also recently got its first tech unicorn with Carsome, an online marketplace for used cars, reaching a coveted valuation of $ 1 billion.

This has been a banner year for fundraising for startups in Southeast Asia, according to Venugopal Garre, CEO of Bernstein which focuses on South and Southeast Asian technology.

“This is, I think, driven by two main things. One is the fact that liquidity is very endemic locally,” he said, noting that the coronavirus pandemic had played a role in the increase investor cash flow.

Grab goes public in $ 40 billion SPAC deal, largest on record
Global stock markets surged during the pandemic, receiving a big boost from technology. Some sectors have also experienced accelerated growth linked to the coronavirus crisis as consumer habits have changed.
Garre highlighted the recent success of Shopee, the Singaporean online shopping giant whose parent company, Sea (I KNOW), has seen its market value skyrocket in recent months. The company saw its share price drop from around $ 37 in December 2019 to $ 304. Its market capitalization, meanwhile, has swelled to nearly $ 159.5 billion.

This success has been convincing for investors eyeing the region’s e-commerce market, according to Garre.

The analyst said many investors overlooked opportunities in Southeast Asia in previous years, as growth there was often seen as “in its infancy” and “attention was largely focused on China and the United States”.

Now that is changing, although he noted that this is not the only region to see momentum. In India, companies have benefited from renewed investor interest, with food delivery start-up Zomato and online payments provider Paytm recently launching or planning their own public debuts.
Zomato shares soar in hot start for first Indian unicorn to go public
Another reason companies there may have attracted more funding lately is a ripple effect from Reliance, Garre suggested. The Indian conglomerate, led by the country’s richest man Mukesh Ambani, embarked on a massive fundraising campaign last year, helping to bring international attention to Indian businesses more generally. , Garre said.

Garre believes the parade of public offerings could help usher in a wave of new listings in both regions. He dismissed critics who expressed concerns about a potential bubble, predicting that the spotlight would likely create more funding opportunities for startups in each market.

“This is just the start,” he said.

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