Grab struggles on Southeast Asia’s heated ride-hailing market
Singapore-headquartered Grab, a ride-hailing-turned-e-commerce group and once Southeast Asia’s most valuable startup, is falling behind Indonesian competitor GoTo in the public financial markets.
The downturn comes as Grab struggles to gain ground against its rival, particular on the latter’s populous home market.
Both companies, after their recent stock market debuts, are still unprofitable and under current economic conditions both struggling to convince investors of their moneymaking potential, Bloomberg News noted.
Their market value has fallen since the initial public offerings. GoTo saw its capitalisation drop to $26 billion from $32 billion at its April 2022 listing, while Grab’s fell even deeper to $13 billion from around $35 billion when it went public in December 2021.
Intense competition
Grab and GoTo have been locked in an expensive battle for dominance over the past several years. Grab still counts the city-state of Singapore as its largest market even as it tries to expand in countries including Indonesia, Southeast Asia’s largest economy.
GoTo, which was created in a merger of ride-hailing firm Gojek and online-retail platform Tokopedia, is enjoying a leadership position in its home nation of more than 270 million people whose mobile-savvy consumers are shopping on Tokopedia and ordering rides and food via Gojek.
Market capitalisation under pressure
In terms of stock prices, GoTo has lost about 15 per cent from the closing price on its first trading day in Jakarta, while Grab is down more than 72 per cent.
While GoTo has a strong grasp of the crucial Indonesia market, Grab has made inroads in food delivery. Grab held 49 per cent of the Indonesian food delivery market last year, compared with GoTo’s 43 per cent, according to Singapore-based tech venture and business intelligence firm Momentum Works.
Better then expected earnings for Grab in the second quarter
Still, there seems to be an upward potential for Grab. The company released its second-quarter earnings on August 25, reporting a better-than-expected 79 per cent revenue increase, buoyed by “resilient demand from consumers” who continued to hail rides and order food despite rising inflation, it said.
Grab’s net loss narrowed to about $547 million, while revenue climbed to $321 million in the second quarter. For the full year, revenue is expected to be between $1.25 billion and $1.3 billion.
GoTo will release its financial statement for the second quarter on August 30.
Singapore-headquartered Grab, a ride-hailing-turned-e-commerce group and once Southeast Asia’s most valuable startup, is falling behind Indonesian competitor GoTo in the public financial markets. The downturn comes as Grab struggles to gain ground against its rival, particular on the latter’s populous home market. Both companies, after their recent stock market debuts, are still unprofitable and under current economic conditions both struggling to convince investors of their moneymaking potential, Bloomberg News noted. Their market value has fallen since the initial public offerings. GoTo saw its capitalisation drop to $26 billion from $32 billion at its April 2022 listing, while Grab’s fell even...
Singapore-headquartered Grab, a ride-hailing-turned-e-commerce group and once Southeast Asia’s most valuable startup, is falling behind Indonesian competitor GoTo in the public financial markets.
The downturn comes as Grab struggles to gain ground against its rival, particular on the latter’s populous home market.
Both companies, after their recent stock market debuts, are still unprofitable and under current economic conditions both struggling to convince investors of their moneymaking potential, Bloomberg News noted.
Their market value has fallen since the initial public offerings. GoTo saw its capitalisation drop to $26 billion from $32 billion at its April 2022 listing, while Grab’s fell even deeper to $13 billion from around $35 billion when it went public in December 2021.
Intense competition
Grab and GoTo have been locked in an expensive battle for dominance over the past several years. Grab still counts the city-state of Singapore as its largest market even as it tries to expand in countries including Indonesia, Southeast Asia’s largest economy.
GoTo, which was created in a merger of ride-hailing firm Gojek and online-retail platform Tokopedia, is enjoying a leadership position in its home nation of more than 270 million people whose mobile-savvy consumers are shopping on Tokopedia and ordering rides and food via Gojek.
Market capitalisation under pressure
In terms of stock prices, GoTo has lost about 15 per cent from the closing price on its first trading day in Jakarta, while Grab is down more than 72 per cent.
While GoTo has a strong grasp of the crucial Indonesia market, Grab has made inroads in food delivery. Grab held 49 per cent of the Indonesian food delivery market last year, compared with GoTo’s 43 per cent, according to Singapore-based tech venture and business intelligence firm Momentum Works.
Better then expected earnings for Grab in the second quarter
Still, there seems to be an upward potential for Grab. The company released its second-quarter earnings on August 25, reporting a better-than-expected 79 per cent revenue increase, buoyed by “resilient demand from consumers” who continued to hail rides and order food despite rising inflation, it said.
Grab’s net loss narrowed to about $547 million, while revenue climbed to $321 million in the second quarter. For the full year, revenue is expected to be between $1.25 billion and $1.3 billion.
GoTo will release its financial statement for the second quarter on August 30.
