Maybank Investment Bank has on Friday maintained a positive view of the new economy in Indonesia as it sees the sector is moving on the right path.
The research house said in a note that it thinks Fintech (lending business) will be a future growth driver for the sector, as Indonesia has a population of more than 270 million and low household debt (9.9 percent of gross domestic product [GDP] as of September 2024).
Maybank also noted the on-demand services (ODS) industry is consolidating with both Go-Jek and Grab Indonesia as leading players in ODS.
It noted that ODS is a duopoly market in Indonesia as the gap with smaller players widens, especially in food delivery.
For ride hailing, it highlighted that Xanh SM is now operating in Indonesia, but the size of its fleet will be limited in 2025, as it currently has only 3,000 taxi licenses, and Xanh SM is focused on the taxi business, not food delivery.
“We see competition in e-commerce is more intense than in ODS, as overseas players are aggressively expanding markets,” it said.
It also thinks competition in ecommerce will intensify if Temu can obtain an operating permit in Indonesia although it believes a permit is not easy to get.
Also, it believes Bukalapak is a potential candidate if Temu decides to acquire an existing e-commerce company in Indonesia.
Maybank opined that GoTo is the most integrated local player in the new economy.
It forecasts FY25 revenue of IDR 17.3 trillion ($1 billion) (+7 percent year on year) for GoTo, with the lending business contributing 29 percent of the FY25 revenue, while
It is noted that GoTo is aiming to double its lending by the first nine months of 2025, from IDR 4.3 trillion ($264.98 million) a year ago.
GoTo made positive developments in the first nine months of 2024, with ODS gross transaction value (GTV) up by 11.4 percent year on year to IDR 45.9 trillion ($2.83 billion), and net revenue rose 82 percent year on year to IDR 7.9 trillion ($486.81 billion), translating to a net take rate of 17.2 percent (versus 10.5 percent for 9M23).
GoTo is on track to achieve profitability with adjusted losses before interest, taxes, depreciation, and amortization narrowed to IDR 72 billion ($4.44 million) in the first nine months of 2024 from IDR 3.7 trillion ($227.97 million) loss for FY23.
Meanwhile, Maybank opined that the management’s strategy for Bukalapak.com (e-commerce) will be critical to reviving the growth momentum.
It sees competition in e-commerce remains intense for Bukalapak , and especially from overseas players.
Moreover, it said that Bukalapak must address structural challenges from flat economic growth and logistics as it expands to non-tier one cities.
Thus, Bukalapak’s revenue growth moderated to 2 percent year on year to IDR 3.4 trillion ($209.53 million) for the first nine months of 2024.