It was quarterly earnings season this week for Indonesia’s listed tech startups GoTo Group, Bukalapak and Blibli.
GoTo Group’s adjusted EBITDA loss came down by 89% year-on-year in Q1 2024 as gross revenue grew 18%. The company credited the all-around improvement in its performance to factors such as user growth, the rise of buy now, pay later in e-commerce, and accelerated integration and payment adoption linked with TikTok. GoTo managed to leverage the integration between Tokopedia and TikTok to achieve notable growth in its fintech segment in Q1, propelled by payments and consumer lending.
E-commerce major Bukalapak hit positive adjusted EBITDA for the first time during the quarter ended March 31, 2024, riding on strong revenue growth, thriving take rate in the O2O segment and cost controls. Bukalapak is now looking to build on that momentum for the whole of 2024.
Global Digital Niaga, an entity that includes e-commerce player Blibli, online travel agency Tiket.com, and supermarket chain Ranch Market, reported lower losses in Jan-March 2024 amid overall improvements in its business. The group recorded a 21.2% YoY drop in losses in Q1, while its net revenue increased 2% YoY as the firm focused on categories with higher margins and faster turnover.
Let’s move on to other headlines that dominated this week.
From the LP-GP quarters
In The LP View this week, we featured AIIB senior investment officer (private equity) Jingyi Zhang, who observed that prominent infrastructure fund managers have transitioned from multi-sector, generalist funds to tailored strategies with a strong focus on energy transition and climate initiatives in Asia. This shift points to a growing recognition of Asia’s pivotal role in addressing climate risks amongst private equity investors and funds.
At DealStreetAsia, we are putting together our flagship Asia PE-VC Summit 2024, which will have a dedicated summit track focused on the asset allocator and limited partner community. Do check out the first batch of prominent LP speakers at our summit.
Paris-listed asset manager Eurazeo is set to open an office in Tokyo this year to boost its international presence. Eurazeo, known for its mid-market strategy, had inherited some legacy venture portfolio companies in Asia from former Grab backer IdInvest Partners, which it took full ownership of in 2020.
FMO has proposed to invest up to $20 million in the tech-focused debt fund of Accial Capital, which is seeking to raise up to $150 million for the closed-ended fund.
Fund managers in India continue to actively hit fundraising milestones, indicating sustained LP interest in the market.
ChrysCapital has closed its continuation fund at $700 million and acquired a stake in the National Stock Exchange, a move that will let India’s homegrown firm hold onto its stake in India’s leading stock exchange.
IvyCap Ventures, which has backed Indian startups including Purplle, Bewakoof, Biryani by Kilo and BlueStone, has closed its third fund at about $252 million. Close to 60% of the corpus raised came from IvyCap’s existing backers.
Morgan Stanley India plans to launch its second private credit fund of around $750 million, VCCircle reported. The firm, which manages the North Haven India Infrastructure Fund, aims to mop up more than double the amount it secured in its last outing.
Venture debt fund Stride Ventures, which has backed the likes of HealthifyMe and Mensa Brands, has hit the final close of its third debt fund at $165 million — $35 million lower than its previous fund.
Oister Global has floated a new fund worth $53 million (Rs 440 crore) to fuel innovations across consumption-driven and emerging technology-led sectors.
In new funds from SE Asia, Malaysian venture capital firm Blue Chip Venture Capital plans to invest in more than 10 startups through its $209 million fund, hoping to help advance the SE Asian country’s chip industry, Nikkei Asia reported.
Thailand-based integrated food company Betagro Public Company Limited has launched its corporate venture capital arm, Betagro Ventures, which will invest from a $30-million fund, in the foodtech and agritech sectors.
Private equity buzz
Warburg Pincus is considering paring its stake in Indonesia’s NWP Property, a real estate platform it set up as a joint venture with listed property firm PT City Retail Developments Tbk in 2015. NWP Property is said to be looking at a fundraising exercise that will likely include both primary and secondary transactions.
Malaysia’s state-owned private equity firm Ekuinas has acquired an 80% stake in active pharmaceutical ingredient manufacturer Symbiotica Specialty Ingredients. This marks Ekuinas’s third investment in the pharma sector.
From India, we reported on Bengaluru-based medical devices maker Forus Health initiating talks with a host of PE firms to raise capital as it looks to expand operations and provide an exit route to some of its investors. Backed by firms such as Accel Partners, Asian Healthcare Fund, Chiratae Ventures, and TEAMFund, Forus develops and manufactures advanced medical devices for the eyecare sector.
Investcorp has agreed to buy NSEIT, the digital technology business of India’s National Stock Exchange, for Rs 1,000 crore ($119.85), as the Bahrain-based alternative asset manager continues to make inroads in the Asian nation.
Azuremount WH, a Hong Kong-based private equity firm led by ex-EQT executives, has made a strategic co-control investment in the Chinese AI software developer ATOM Intelligence.
Deal news
Singapore-based food tech player GLife Technologies, which counts Temasek-backed Heliconia Capital as its major investor, is said to be in advanced discussions to acquire troubled Indonesian agritech startup EdenFarm. The distress sale will likely value EdenFarm at $4 million, which is just a fraction of its last valuation of over $90 million.
Indonesian grab-and-go coffee chain leader Kopi Kenangan is tapping the country’s lucrative mass market with the introduction of a new sub-brand, Satu Kenangan. With this, Kopi Kenangan has officially joined other local coffee chains offering a cup of coffee for less than a dollar to woo a larger pool of customers.
ReturnKey, an Indonesian full-stack recommerce platform, has secured fresh funds in a Series A round from Argor Capital and Vertex Ventures. Argor Capital is a venture capital firm backed by the Indonesian tech giant GoTo and was formerly known as Go-Ventures.
Indonesian carbon management operator Jejakin has raised $2.5 million in a new seed funding round. Indonesian renewable energy company ITM Bhineka Power, East Ventures, Indogen Capital and SMDV participated in the round.
Hong Kong-listed L’Occitane International’s chairman and controlling shareholder will take the French skincare firm private, valuing it at a maximum of $1.78 billion.
Super Hi International Holding Ltd, a Singapore-based company that operates hot pot restaurants, has filed to raise up to $100 million in an IPO in the US. The Hong Kong-listed company operates restaurants under its former parent’s brand Haidilao.
We also brought you updates on fund commitments from multilateral institutions to South Asian companies. IFC is mulling an investment of up to $35 million in iBUS Network and Infrastructure Ltd, a provider of wireless solutions in buildings. The investment comes just weeks after the Indian government-backed National Investment and Infrastructure Fund Limited bought a majority stake in iBUS for $200 million.
IFC is likely to invest up to $60 million in KKR-backed Indian non-banking finance company Five Star Business Finance.
FMO is considering a proposal to invest $5 million in GH2, a renewable energy developer in Pakistan. Meanwhile, IFC is weighing an investment of up to $40 million in a risk-sharing facility with HBL Microfinance Bank, one of Pakistan’s largest microfinance providers.
Analysis and deep dives
This week we brought you analytical pieces on financing needs in the climate investing space, private equity play in healthcare assets in South and SE Asia and changing trends in the venture debt asset class.
Asia’s new world of climate investing needs philanthropists, creative finance, and a lot of time, experts say. The nascent climate investing space needs to find ways to debunk assumptions, de-risk climate projects and find “creative” methods to funnel untapped financing into this emerging sector. There is a $1.5-trillion investment gap affecting a wide spectrum of areas from solar renewables, to green data centres and nature-based projects.
Global investment firms that had backed Indian hospital chains have been able to seal healthy exits from their investments lately. The successful exits are luring more private equity (PE) giants to invest in the hospital space in India, which is also having a rub-off effect on Southeast Asia’s healthcare space as the two regions have common investors and share a similar growth trajectory.
Despite companies rushing to raise venture debt amid a crunch in equity financing, accessing large pools of capital through this route remains challenging for Indian startups. The number of late-stage venture debt deals has witnessed a steady decline over the years, with 24 deals in 2021, 16 in 2022, and only five in 2023, according to data by Tracxn. We explore the reasons behind this trend.
