Indonesian ecommerce company Bukalapak is aiming to raise up to $1.5bn for an initial public offering, in what is set to be country’s biggest equity listing in more than a decade.
The online marketplace — whose investors include US technology giant Microsoft, Chinese tech company Ant Group and Singaporean sovereign wealth fund GIC — plans to raise between $1.3bn and $1.5bn, according to a termsheet seen by the Financial Times.
Bukalapak — whose name means “open a stall” — is aiming to list on Indonesia Stock Exchange (IDX) on August 6 and could be valued at as much as $6bn, according to the documents. This would make it the biggest local IPO since 2008 and potentially Indonesia’s largest listing if it hits the top end of its range.
Indonesia’s internet economy has grown rapidly in the past few years as internet usage has taken off across the region.
Bukalapak’s deal is a crucial first test of local start-ups’ ability to go public. The country of 270m people has the most unicorns — private companies valued at more than $1bn — in south-east Asia but so far none have tapped public markets.
That is set to change this year. Indonesia is working towards an overhaul of its listing rules to encourage more start-ups to list locally instead of heading to the US or other exchanges in Asia, including relaxing restrictions on lossmaking companies.
Pandu Sjahrir, IDX commissioner, said he expected Bukalapak’s IPO to encourage other technology groups to consider the stock exchange as their listing choice. The listing is a “great first step” in showing the confidence of big tech groups in the exchange since it had demonstrated a “willingness to listen”, Sjahrir said.
Gojek, the Indonesian super app, plans to go public later in 2021 via a dual listing in Indonesia and the US after completing its merger with Bukalapak’s rival Tokopedia in May.
But others are still targeting Wall Street. Traveloka, the country’s answer to Expedia, is in advanced talks with Peter Thiel’s Bridgetown special purpose acquisition company to list in the US.
Bukalapak’s marketplace caters to the country’s millions of small “mom-and-pop” stores, helping them sell their goods online. It also provides other services such as internet bill payments and has started offering financial products such as mutual funds.
The company is one of Indonesia’s earliest unicorns but it has struggled against rivals, falling behind other ecommerce players including Tokopedia and regional giant Shopee in recent years.
Bukalapak posted revenues of $95.8m according to its filing and had 104.9m registered users across the country. It is not yet profitable but in 2020 managed to cut its net losses more than 50 per cent to $89.5m.
Some traders expressed disbelief at the high valuation, given the company has not revealed any cornerstone investors as part of the IPO. The price tag was well above what Bukalapak had been offered for in private markets to potential acquirers, two people with direct knowledge of the negotiations said.
“We are scratching our heads over how a company that is not one of the top two players in the market is getting so much demand,” said one investment banker.
“It could suggest that what is going on in China may have already spooked some asset managers that need exposure to Asia’s technology space,” they added, referring to the crackdown on Didi Chuxing and uncertainty over Chinese tech listings in the US.
