Shares jump in Indonesia’s biggest market debut

A bukalapak.com agent in his shop.
Bukalapak focuses on micro, small and medium-sized businesses outside Indonesia’s biggest cities.

Shares in e-commerce firm Bukalapak have jumped almost 25% in Indonesia’s biggest ever initial public offering. It comes ahead of another hotly-anticipated listing in the country of ride-hailing, food delivery and e-commerce giant GoTo.

The region’s start-ups have become popular with global investors as they chase fast growing online markets. Another internet company in the region, South Korea’s KakaoBank, also soared on its market debut in Seoul on Friday.

Bukalapak is an 11-year old firm, with backers including Microsoft, China’s Ant Group and the Singapore sovereign fund GIC. It raised $1.5bn (£1.1bn) in the initial public offering (IPO).

Although it is loss-making, at its IPO price the company was valued at $6bn. Bukalapak began as an e-commerce platform, but now offer services including helping smaller businesses sell on the internet.

It targets micro, small and medium-sized businesses outside Indonesia’s biggest cities and is the country’s fourth-largest e-commerce player after Tokopedia, Shopee and Lazada.

Indonesia’s $40bn online shopping market has been boosted by the coronavirus pandemic with many consumers staying at home and more businesses selling online.

Investors around the world are also watching share listings in Indonesia closely ahead of a planned multibillion-dollar IPO of GoTo.

GoTo is the country’s most valuable start-up, and was created by the merger of ride-hailing and food delivery firm, Gojek and e-commerce giant, Tokopedia.

Also on Friday shares in South Korea’s first online-only lender KakaoBank jumped by as much as 74% on its market debut, giving it a market valuation of $28bn.

That would make the firm, which has no physical branches, worth more than any of South Korea’s traditional lenders. The firm was formed in 2016 after the South Korean government started offering permits for internet banks.

The online lender has seen its customer base grow quickly, helped by its parent company’s messenger service KakaoTalk. The KakaoTalk app is used by more than 90% of South Korea’s smartphone users.

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