Posted on 17 Apr 2021
Grab has recently filed for IPO by merging with a SPAC, as a home grown company, would you consider investing in it? What are you thoughts and reasoning behind that decision ?
Copying my answer from another question:
Nah, personally not too keen.
Despite their goal in becoming a super app, which sounds nice, I do have concerns over the profitability of their main segments (ride hailing and food delivery). As such, I don't see a clear path to profits for them, unlike certain other business models where it's much more clear cut.
Plus, I don't like to invest much in fresh IPOs as I feel that there's a lot of hype generally at the start, which may cause a dip in the near future when it fizzles out.
Lastly, I guess being a home grow company doesn't really affect my decision tbh. Most of my stocks are China or US companies with the 1 exception being Sea Ltd (NYSE:SE), which technically, is home-grown (and possibly the best home-grown company to be in, but I'm biased haha). But what's more important is the fundamentals that support the company. If it's good, I'll invest in it. That's it.
Instead of thinking if Grab is a good company to invest in, perhaps another way to look at it is, of all the companies out there in all the exchanges, do you really think Grab is the most attractive one to invest in at this point? For me, the answer is a definite no.
Definitely No. For a company that lost 800million over 1+ billion revenue to be launched at a usd 40 billion valuation is insane. Moreover , plus the voting rights of 60+ % with a 2% share holdings are obviously taking a free ride from the investors. Beside this, I do not see grab having any competitive advantage to gain any leadership positions in other markets other than in Singapore/Malaysia. They keep saying it is a super app? Maybe many did not have the chance to experience wepay and alipay. Personally I am not a user of grab app, and I definitely can live without it.
Would definitely consider investing into Grab, after portioning a reasonable amount of my total inve...
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