Investor Daily Summit 2021

Menanti IPO Perusahaan Big Tech

Batara SianturiCEO Citi Indonesia

Thursday, July 15, 2021

Over $40 billion has gone to fund South East Asia Tech PlayersFunding has been extremely concentrated to few internet platforms who have large number of customers. B2B businesses are slowly gaining traction.

Source: Wall street research, TechlistAsia, AVCJ, Crunchbase, Company information, Newsrun.

$4,800 $4,200$2,750

$1,440$387 $305 $300 $183 $175 $150 $144

A Significant Portion of the Capital was Strategic

$7,264

$12,100

Total Capital Raise(US$ in Millions)

the South East Asia Ecosystems have raised >$30 Billion

COVID-19 has accelerated digital adoption in South East AsiaNew consumption and payment habits have emerged during the crisis, paving the way for a more digitized South East Asia.

Source: Facebook & Bain SYNC 2020 Southeast Asia Report – Digital Consumers of Tomorrow, Here Today.

ASEAN Technology and Fintech LandscapeIndonesia and Vietnam provides the largest independent opportunities while Singapore provides a developed market regulatory framework for regional / global businesses.

Ecosystem: Rise of Digital Banks and the First Tech IPO• Six Indo banks are undergoing transformation into digital banks,

among them: BRI Agro (AGRO), Bank Neo Commerce (BBYB), Bank Capital (BACA), Bank Harda (Allo Bank) and Bank QNB, while six banks have already transformed into digital banks (BCA Digital, Jago, Digi, TMRW, Jenius and Wokee).

• Banks have mentioned that they plan to go digital: Motion Banking (Bank MNC) and Bank Aladin (BANK). Separately.

• Bukalapak will become the first tech unicorn to be listed in Indonesia with a mission to become an 'All Commerce" company and their focus is to empower offline and online MSMEs through the use of technology. Currently, Bukalapak has three main businesses which are Marketplace, Mitra Bukalapak and BukaPengadaan.

Top 10 Market Cap Has 2 Techs Related Names• There are two Tech related corporates (Bank Jago and Emtek) on the

10 market caps in Indonesia from none a year ago which showed strong share prices appreciation in the Tech related names.

• We believe the top 10 largest market cap in Indonesia could be dominated by the Tech cos in 2-3 years time where more than half could be Techs related.

Merger and consolidation in the Techs name are important to create more synergy, increase ecosystem and creating more value. We think the case study of GoTo could be a good role model and benchmark for other Techs start-up to find an alternative of merger before doing an IPOs

The Future IPO of Tech Companies – 1

The ADTV(average daily trading turnover) of the Indonesian stock market in USD terms have not been growing much from 2007-2019 partly due to the lack of availability of sizable stocks as mentioned by many foreign investors. ADTV started to improve during COVID-19 due to the significant involvement in domestic retail investors. With Techs IPO, we should expect more contribution from foreign investors and coupled with the domestic retail investors’ involvement, the Indonesian market ADTV could easily doubled.

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The Future IPO of Tech Companies – 2 COVID Has Increased The E-commerce Transaction Dramatically

COVID-19 has increased the value of digital transaction and in 2020, retail e-commerce has already accounted close to 20% of the total retail sales vs 2% in 2016. We should expect higher retail-ecommerce going forward as % of total retail sales.

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ID Weighting in MSCI could Rise with More Tech IPOs

• The weighting of Indonesia in the MSCI EM index has declined significantly from 3.0% in early-2016 to 1.1% currently. This was mainly due to lack of new company inclusions in MSCI Indonesia, stagnant share prices, coupled with China A-shares inclusion into the Index.

• We expect that upcoming tech cos’ IPOs could boost Indonesia’s weighting in the Index, if unicorns like Bukalapak and GoTo are included. Based on the experience in other markets, some companies with the size and freefloat similar to these companies were included in the index right after the IPO.