Summarize this content to 2000 words in 6 paragraphs in Arabic Stay informed with free updatesSimply sign up to the Asia-Pacific companies myFT Digest — delivered directly to your inbox.The chief executive of Indonesian tech giant GoTo has not ruled out merging with rival Grab as he revealed the company\u2019s first annual profit on Wednesday.GoTo, which runs the Gojek ride-hailing service and is part-owner of ecommerce platform Tokopedia, has reportedly been in talks to be taken over by Singapore-based Grab.\u00a0A merger would bring together two of south-east Asia\u2019s biggest tech companies, with a combined market value of $23bn. That would be far below the combined $72bn they were worth at their respective\u00a0IPOs in 2021 and 2022, with intense competition in the region for ride-hailing and food-delivery services forcing down prices and leading to losses.GoTo has denied any merger agreement is in place, but in an interview with the Financial Times, CEO Patrick Walujo said he would be open to a deal that boosts returns for the company\u2019s investors.\u201cI will always be open to anything that is enhancing our shareholders\u2019 return\u2009.\u2009.\u2009.\u2009in the long term,\u201d said Walujo, who has overseen GoTo\u2019s transformation into a profitable company.\u00a0When asked if he would be open to a deal involving the whole company or parts of it, Walujo said: \u201cThis is something that we need to really consider. Because the other thing that\u2019s unique about GoTo is that we are a national champion.\u201dGoTo had a responsibility to its employees, he added, as well as to building tech capabilities in the country.Nasdaq-listed Grab and Jakarta-quoted GoTo have explored a merger in recent years, but no deal was ever struck.Analysts said a combination would reduce pressure on margins faced by both companies due to intense competition in a region of more than 650mn people.However, any deal is likely to attract regulatory scrutiny as it would involve two of the region\u2019s biggest ride-hailing and food-delivery groups.\u00a0GoTo is one of Indonesia\u2019s most successful \u201cunicorns\u201d \u2014 start-ups with a valuation above $1bn \u2014 attracting early investments from SoftBank and Alibaba. It debuted on the Indonesian stock exchange in 2022 with a valuation of $32bn.But its share price has slumped 80 per cent since the IPO as intense competition across all its businesses squeezes margins. The group is now valued at just $5.4bn.Shares of Grab have also declined by more than two-thirds since its IPO through a $40bn deal with a blank-cheque company in December 2021.Other than Grab, GoTo also competes with Sea Group\u2019s Shopee in ecommerce.In an effort to achieve profitability, GoTo has scaled back some of its operations in recent years. It sold a controlling stake in Tokopedia to TikTok in 2023 and last year retreated from Vietnam.On Wednesday, GoTo posted adjusted earnings before interest, tax, depreciation and amortisation \u2014 the company\u2019s key profitability measure \u2014 of Rp386bn ($23.5mn) for 2024, its first annual profit. Revenue grew 30 per cent, while gross transaction value across all its businesses jumped 58 per cent.Walujo, who took the helm in 2023, said GoTo\u2019s profitability could be sustained depending on its ability to innovate and \u201cbe the lowest-cost player in the market\u201d. The company expects adjusted ebitda to increase to a range of Rp1.4tn-Rp1.6tn this year.Its part-ownership with TikTok has had a \u201chuge\u201d impact on profitability, he said, with the social media group \u201cpouring [in] a lot of money\u201d and \u201ca lot of resources\u201d, allowing GoTo to focus on ride hailing, food delivery and financial services.GoTo will continue to concentrate on the Indonesian market, which Walujo said still had huge potential across all three of its core businesses. Outside its home base, the company offers ride-hailing services in Singapore, while Grab operates in eight south-east Asian countries.Much of the future growth is expected to come from the financial services arm, which offers loans and \u201cbuy now, pay later\u201d services, Walujo said.The unit broke even on an adjusted ebitda level in the fourth quarter of 2024 \u2014 one year ahead of GoTo\u2019s initial guidance \u2014 and is expected to post adjusted ebitda of at least Rp300bn in 2025.\u201cOur financial services is growing a lot faster [than our other businesses], and the total addressable market is a lot bigger,\u201d he said.Analysts have also become more positive on the stock. In a March research note, JPMorgan upgraded GoTo\u2019s stock to \u201coverweight\u201d.\u201cWe believe GoTo\u2019s ebitda trajectory is at inflection point as it is moving to positive territory thanks to the successful outcome of the new turnaround strategy in the past two years with a good balance of growth and profitability,\u201d it said.<\/p>\n","protected":false},"excerpt":{"rendered":"
Summarize this content to 2000 words in 6 paragraphs in Arabic Stay informed with free updatesSimply sign up to the Asia-Pacific companies myFT Digest — delivered directly to your inbox.The chief executive of Indonesian tech giant GoTo has not ruled out merging with rival Grab as he revealed the company\u2019s first annual profit on Wednesday.GoTo,<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[63],"tags":[],"class_list":{"0":"post-237733","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-tech"},"_links":{"self":[{"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/posts\/237733","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/comments?post=237733"}],"version-history":[{"count":0,"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/posts\/237733\/revisions"}],"wp:attachment":[{"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/media?parent=237733"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/categories?post=237733"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/globetimeline.com\/ar\/wp-json\/wp\/v2\/tags?post=237733"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}