Indonesia records another biggest IPO in more than a decade. One of its e-commerce unicorns, Bukalapak, received enough orders from investors to cover the sale on its launch day.
Upon Bukalapak’s IPO, two anonymous sources familiar with the deal told Reuters that the company has received a great number of orders from large investors. This further signifies that Bukalapak’s IPO was covered across its indicative price range.
As if to confirm the news, Bukalapak increased the target for its IPO. A few months ago, the 4th biggest e-commerce company set its IPO target at just $300 million. The figure then grew to $800 million.
As of this week, the company decided to expand the offer again by 25%. The reason behind this is likely due to the investors’ interest in the company’s shares.
A director of Panin Asset Management Jakarta, Rudiyanto, commented, “As the first tech unicorn to launch an IPO in Indonesia, the hype, especially from retail investors, is quite high,” Reuters quotes.
Bukalapak IPO: how it’s been going
Bukalapak currently aims to raise up to $1.13 billion by selling as much as 25% of its enlarged capital. It is marketing the shares between 750 and 850 rupiah apiece.
Bukalapak is aiming to seek a valuation of up to $5.6 billion. The figure is more or less twice the level from two years ago. Accordingly, big-name companies such as GIC, Ant Financial, local media conglomerate Emtek and Microsoft, are backing up Bukalapak’s IPO.
Bukalapak’s IPO is open for book until July 19. At the same date, Bukalapak will reveal the share price. Meanwhile, the company will be making its official market debut on August 6.
Additionally, Bank of America and UBS will be participating as the joint global coordinators and bookrunners with Mandiri.
Through an online briefing, Bukalapak CEO Rachmat Kaimuddin told investors, “Our business is focused on micro, small and medium-sized enterprises. They are the prime movers in the Indonesian economy”.
“The opportunity to digitalise them and cater to underserved markets, especially outside the big cities, is very promising,” Kaimuddin added.
According to Kaimuddin, Indonesia’s e-commerce were predicted to reach 30% transactions to occur in second-tier cities last year. The percentage has now risen to 48% by 2025.
Bukalapak Post-IPO
Bukalapak will be allocating over 60% of the IPO proceeds for its business. Accordingly, Bukalapak generated $95.8 million in revenue back in 2020 with over 100 million users. Bukalapak will be allocating the remaining funds to expand its subsidiaries.
Indonesia’s market went through ups and downs during the pandemic. In relation to this, the expectation for Bukalapak and the upcoming GoTo’s IPO is high. Some predicted that both companies’ IPO could help boost Indonesia’s market. Money raised through IPOs has decreased for over than half in 2020 to $470 million, Refinitiv data showed.
Read also: Malaysia: Axiata and DigiCom Merge into Celcom Digi
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