GoTo IPO debuts in politically smart fashion
Last updated on: 11 April,2022 11:50 pm
GoTo IPO debuts in politically smart fashion
HONG KONG (Reuters Breakingviews) - GoTo’s (GOTO.JK) bosses racked up political points on its Monday debut. Top brass rode to the Jakarta ceremony on own-brand electric mopeds while the $1.1 billion deal, the first under new rules designed to lure startups, boasted a record number of participants. Shares in the $28 billion e-commerce, ride-hailing and financial technology firm then jumped more than 20% in opening trade.
GoTo’s float follows a year in which other hot Asian tech IPOs have soared on open only to falter soon after, including Korea’s Coupang , Singapore-based Grab and local rival Bukalapak (BUKA.JK). None of three now trade within 50% of their listing prices. At 28 times trailing sales, unprofitable GoTo is roughly in line with Grab, its regional rival.
The company’s push towards using electric scooters is political catnip in polluted Jakarta; giving its drivers a piece of the float widens its investor base and generates local goodwill. It doesn’t hurt that the commodities-heavy Jakarta bourse is up 11% this year. Perhaps GoTo’s political nous will help keep its share price from dropping into lower gear.