Grab IPO: Grab IPO Date, Listing Price, Valuation, News & Review | INDmoney

Grab IPO: Grab IPO Date, Listing Price, Valuation, News & Review | INDmoney

Last updated: 02 Dec, 2021 | 12:56 pm

Grab to make its debut in US market on Dec 2: Key things to know

Grab IPO: Grab is all set to list on NASDAQ on 2 December 2021 after its $40 billion merger with special-purpose acquisition company (SPAC) Altimeter Growth Corp. This is going to be the biggest US listing by a Southeast Asian firm. The combined entity will start trading on the Nasdaq on Dec 2 under the ticker GRAB.

About Grab 

  • Grab was founded in 2021. Initially, it was an on-demand ride-hailing provider. Over the years, the company has expanded its business, and now it offers multiple services including food delivery and mobile payment.
  • The company is focused on the Southeast Asian market with headquarters in Singapore. The other countries where they have a strong presence are Malaysia, Indonesia, Vietnam, Thailand, Philippines, Cambodia, and Myanmar.
  • Overall, they operate in 465 different cities. In 2018, it bought the Southeast Asian business of Uber Technologies Inc in return for the US ride-hailing company taking a stake in Grab.
  • Grab forayed into the fintech space and introduced its GrabPay wallet in 2017. A year later, it launched Gran financial Group.
  • Grab also has an enterprise arm offering advertising, fraud detection, and upcoming mapping service.

Grab's Investors

  • The early investors of Grab include Japan's SoftBank, China's Didi Chuxing, and venture capital firms Vertex Ventures Holdings and GGV Capital.
  • Its investors range from hedge funds and venture to automobile companies and other ride-hailing companies like Uber, Booking Holdings Inc, China Investment Corp, Coatue Management, Hillhouse Capital, Hyundai Motor Co, Invesco Ltd, Microsoft Corp, and many more.
  • Grab's largest shareholder is Softbank Vision fund with a total stake of 18.6% and voting rights of 7.6%

Grab stock: Competition

  • The company faces stiff competition in each of its business segments and each of its markets from homegrown competitors.
  • Grab is going to make a public debut after four years of its rival tech giant Sea Limited listing on NYSE (Oct 2017). 
  • Sea Ltd has e-commerce, gaming, and a digital payments business, and now they are planning to enter into food delivery and financial services in Indonesia. It will direct competition for Grab.
  • Indonesia's GoTo is also set for listing in early 2022 and going through the pre-IPO round. The other competitor includes local e-commerce leader Tokopedia. It also competes with such delivery companies as Foodpanda and Deliveroo PLC.

Grab Financials

  • Grab Q3 revenue fell 9% from a year earlier to $157 million, and it has never reported profits.
  • The deliveries segment logged a 58% year-over-year leap in revenue to hit the US $49 million. On the other hand, Grab’s revenue from its mobility business saw a further 26% decline year on year.
  • Grab's net loss stood at $988 million for the three months ending September against a net loss of $621 million in the same period last year.
  • Its adjusted loss before interest, taxes, depreciation, and amortization has increased by 66% to $212 million.
  • In 2017, GMV reached $1 billion, in 2018 $5 billion, and in 2019 GMV was $10 billion. Gross Merchandise Value (GMV) hit a quarterly record of $4 billion in Q3.
  • Grab forecasts it will turn profitable on an EBITDA basis in 2023.

Grab Valuations

Grab's SPAC merger with Altimeter Growth gives the combined entity a mcap of $40 billion. In 2021, Grab expects to post revenues of about $2.3 billion, implying a price-to-sales ratio of 17.  For perspective, Zomato’s IPO had been priced at 28 times FY21 revenues. Profitability could remain a key overhang over the near-term. While the company has not posted any profit as yet, it has shown very strong growth. As it grows larger and revenue gains outpace rising costs, it should become profitable. Investors with a high risk appetite who wish to take exposure to a fast growing digital super app could consider investing in this issue.