Official IPO, Blibli Rely on Omnichannel to Pursue Profitability

PT Global Digital Niaga Tbk (IDX: BELI) reveals its strategy omnichannel with the three business units, e-commerce, online traveland e-grocery, will help smooth the company's steps towards profitability. Moreover, all three still have positive prospects in the future.

In a virtual press conference held today (8/11), Blibli CFO Hendry said, although he could not go into specifics, he said that the company's ambition to enter Strategy omnichannel has been carried out since several years ago, and the process of developing the ecosystem is complete. Since then, the company has been able to improve its EBITDA efficiency, which can be seen from the performance in the first half of this year.

"We are optimistic about this indication. paving block for strategy omnichannel was completed late last year. But already seen impact[from EBITDA] in the first semester," he said.

Regarding the efficiency of EBITDA, referring to the company's performance report, since 2019 until the first half of this year, the company has carried out marketing effectiveness. The ratio of marketing costs to TPV (Total Processing Value) decreased from 6% in 2019 to 3,6% in the first semester of 2022.

Efficiency is also carried out at discounted prices or promotional discounts. In 2019, Blibli's discount ratio to TPV was 7,1%, then dropped to 2,3% in the first semester of 2022. "So the EBITDA margin shows a positive margin. In the first semester of 2022, Blibli's EBITDA margin shows an improvement of 140 basis points."

Blibli has four segments in the TPV division. First, 1P retail, namely Blibli offers its own products, so that Blibli has full control over prices and margins. Second, 3P retail, namely Blibli, cooperates with brand principal and selling to third parties in offering the product.

Within that segment, around 50% comes from lifestyle travel and travel, Tiket.com's main business source. Then next, institutions and physical outlets. Physical store segment it just started in March 2021 by opening a physical store and continued with the acquisition of Ranch Market.

Of these four segments, Blibli recorded a TPV growth of 45% throughout 2021 with a total of IDR 32,4 trillion. Meanwhile, in the first semester of 2022, TPV was recorded at Rp24,13 trillion, an increase of 89,29% (YoY) from Rp12,75 trillion in the first semester of 2021.

According to Hendry, the prospects for the four segments are still great and continue to show a positive trend. For business travel only, for example, it is recorded as starting rebound and it is predicted that this trend will continue to be maintained in the future. Likewise for business e-grocery, with the contribution to total national retail spending which is still minimal, there is still a lot of room for growth. Not to mention, in this business have take rate large to support margin growth double digits.

“From synergies with three companies [Blibli, Tiket, Ranch Market] by running omnichannel, the efficiency will be much greater. From the beginning, consumer acquisition was done individually, now it can be done together. So we believe in the potential profitability of BUY in the future.”

Become a public company

At the same time, this morning Blibli was officially listed on the main board of the Indonesia Stock Exchange (IDX) with the stock code BELI. The initial price offered is close to the upper limit of the offering price range at Rp450 per share.

The funds that have been obtained from the celebration are around Rp. 8 trillion with a valuation of Rp. 53,3 trillion. It was explained that this initial public offering received support and interest from various domestic and international investors, consisting of: sovereign wealth funds, long-only funds, multi-strategy funds, private wealth management, and others.

It is claimed that the enthusiasm of investors recorded the level of excess demand up to 4,4 times in the centralized allotment (pool portion), resulting in an increase in the allocation amount from 2,5% to 5% of the total bid amount.

Blibli co-founder and CEO Kusumo Martanto said Blibli is the only one internet-unicorn in the Asia Pacific region, which has been in the capital market since May 2022 and the second largest in Asia Pacific to conduct an IPO throughout 2022.

"This is also the second largest IPO in 2022 and the fifth largest IPO in Indonesia's history. We successfully completed the IPO amidst volatile stock market conditions and widespread sell-off in the technology sector," said Kusumo.

The net funds obtained by the company will be used for debt repayment and for working capital. In the Blibli IPO, Credit Suisse (Singapore) Limited and Morgan Stanley Asia (Singapore) Pte acted as Joint Global Coordinators (JGC), while PT BCA Sekuritas and PT BRI Danareksa Sekuritas acted as Joint Lead Underwriters (JLU).

PT Credit Suisse Sekuritas Indonesia, PT Morgan Stanley Sekuritas Indonesia, and PT DBS Vickers Sekuritas Indonesia together with other syndications act as the Underwriters.