Razer eyes US listing, but SG peers’ struggles weave cautionary tale

Opening Bell 🔔 is Tech in Asia’s free newsletter, which brings you the biggest news and latest trends around publicly listed Asian tech companies. [Read from your browser]( Opening Bell 🔔 Welcome to the Opening Bell! Delivered every Monday via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and latest trends on Asia’s publicly listed tech companies. If you’re not a subscriber, get access by [registering here](. Hello {NAME} On November 14, 2017, Razer Inc (1337, HKG) basked in the glory of a stellar market debut. The maker of gaming hardware had listed at HK$3.88 per share and closed 18% higher on its first day of trading in what would go on to be Hong Kong's second-most successful IPO that year. But that was as good as it ever got for Razer's fortunes in the Asian financial hub. Fast forward to nearly five years later, and common shareholders [approved]( a proposal for Min-Liang Tan, Razer's founder and CEO, to take the company private through a consortium that includes several top Razer executives. The company will go private at a valuation of US$3.17 billion - lower than what it was worth when it listed. After all, the consortium - of which private equity firm CVC Capital Partners is a part - believes Razer has been [undervalued]( in Hong Kong, where it has suffered from low trading volumes. Razer’s turnaround plan, in a nutshell, is to eventually [list]( in New York, hoping to exploit the higher valuations that tech stocks enjoy there. A quick scan of how its Singaporean tech peers have performed on US-based exchanges, however, might compel Razer to rethink its strategy. The obvious cautionary tale is that of Grab (GRAB, NDAQ): The super app lost a fifth of its value on the day of its listing in December and never really recovered since. Despite reaching a high of US$13.29 apiece within hours of its market debut, Grab’s shares currently trade below US$3.00. Another Singapore-based company that has succumbed under the weight of negative investor sentiment, despite being an even bigger tech giant, is Sea Group (SE, NYSE). The firm has shed over 70% of its value in the last six months. However, it is worth noting that Sea’s shares, which debuted the same year as Razer’s, trade over five times higher than their IPO price of US$15.00 per share. Meanwhile, M&A chatter has pushed Razer’s stock up in the last six months, but its shares still trade more than 30% below its listing price. For now, however, Razer and its executives are probably happy just to have put an end to the firm’s harrowing experience on the Hong Kong stock exchange. Speaking of IPOs, GoTo Group’s (GOTO, IDX) shares have already slipped below their IPO price of 338 rupiah within three weeks of listing. However, that hardly puts a dent in the mammoth returns GoTo’s early investors have pocketed. In [this premium story]( Tech in Asia explores how the Indonesian tech giant’s major wins for two of its early backers could supercharge Southeast Asia’s VC scene. In search of more growth avenues, GoTo ventured into the digibank space through Bank Jago (ARTO, IDX). The super app appears to have hit the nail on the head as the digibank [posted]( an 8x jump in revenue to US$24 million for the first quarter of 2022. Obviously, GoTo was not the only one to sense the massive potential of this space in Indonesia. Sea, Akulaku, Kredivo, and Bukalapak (BUKA, IDX) have all dipped their toes in the sector. The latest entrant is investment app Ajaib, which has accumulated a 40% stake in Bank Bumi Arta (BNBA, IDX). My colleague, Aditya, breaks down how and why the Indonesian unicorn’s entry into digital banking signals its ambition to become a financial super app in [this premium piece](. -- Shravanth 4 STOCKS TO WATCH Hot stocks, earnings reports, restructuring, activist investor pressure, and more. We feature the stocks that are likely to make big moves during the week. 🇨🇳 Alibaba (BABA, NYSE): The ecommerce behemoth’s shares have gone off the boil and with good reason, slumping nearly 45% in the last six months. The firm has had to contend with a slowing domestic economy, heightened competition, and China’s crackdown on big tech. However, that hasn’t stopped it from plotting a reversal in fortunes. In this set of in-depth premium stories, Tech in Asia analyzes Alibaba’s [moves in direct retailing]( – a business model that Jack Ma once reportedly ridiculed – and its big international [push to establish]( Lazada, its Southeast Asian ecommerce arm, in Europe. 🇮🇩 Bukalapak (BUKA, IDX): The ecommerce giant has been in dire need of some momentum in its share price ever since it became Indonesia's first unicorn to be listed on the local stock exchange last year. Its recent [earnings report]( may have just provided it. Bukalapak earned 14.5 trillion rupiah (around US$1 billion) in net profit in the first quarter due to the gain from its investment in Allo Bank, while revenue jumped 86% to 788 billion rupiah. Revenue from Bukalapak’s Mitra business, which focuses on serving SMEs, surged more than 3x to US$32.6 million in Q1. See also:[Bukalapak’s financial performance in 8 charts]( 🇨🇳 NetEase Inc (9999, HKG): A lot has been happening at this gaming company last week. The firm decided to [shut down Rules of Survival,]( its battle royale title (a game similar to Fortnite), after nearly five years of operations. Furthermore, its cloud unit [sued]( Tencent Music Entertainment (TME, NYSE), accusing it of unfair competition and plagiarizing its app design. 🇸🇬 Sea Group (SE, NYSE): The gaming and ecommerce firm has been [offered]( a 10% stake in Bank Mayora by state-owned Bank Negara Indonesia (BNI). Sea has already helped BNI transform Bank Mayora into a digital bank by providing services to develop its tech and business model, according to BNI president director Royke Tumilaar. BNI currently holds a 63.9% stake in Bank Mayora, while Mayora Group’s ownership has been diluted to 36.1%. 3 MARKET WHISPERS A lot more reliable than whispers, we highlight engaging source-based reporting from reputable news outlets around the globe. 1️⃣ Trouble continues to stack up: There appears to be no end in sight to the troubles coming Didi Global’s (DIDI, NYSE) way. The ride-hailing firm has borne the brunt of China’s crackdown on tech firms - so much so that the mobility firm plans to delist from the New York Stock Exchange. Now, it has [halted plans]( for to list in Hong Kong until it has made enough “rectifications” to fall in line with guidelines from China’s cyberspace administration, sources told South China Morning Post. The crackdown has also hurt Didi’s finances as its net loss in 2021 ballooned threefold to nearly US$7.7 billion. 2️⃣ A rehearsal before the final act: Honor is looking to [raise capital]( at a US$45 billion valuation ahead of its public listing, which could come as early as this year. In a bid to distance itself from its former parent firm Huawei Technologies, the Chinese smartphone maker is already in talks with investors to raise foreign funding. However, overseas investors remain wary, fearing future US restrictions against the former Huawei subsidiary. Meanwhile, Huawei itself continues to reel from US sanctions. The telecommunications giant [reported]( a 13.9% year-on-year fall in its first quarter revenue last week. 3️⃣ Losing a cog in a well-oiled machine: Grab just can’t seem to catch a break at the moment. On top of mounting woes in the stock market, the Singapore-based firm is now seeing a host of top execs head for the exit door. Ankur Mehrotra, managing director of Grab Financial, is [looking to end his stint]( at Grab to join BukuWarung, an Indonesia-based bookkeeping app. The loss of a key executive will come as a blow at a time when Grab seeks to ramp up its foray into financial services. Mehrotra could be the latest exit after Wui Ngiap Foo, another top Grab executive who left the firm to lead blockchain gaming startup Ethlas, and Nguyen Thai Hai Van, who resigned from her post as Grab Vietnam's managing director earlier this month. 2 EYE-POPPING FACTS Tech in Asia scours the internet to bring you the head-turning numbers from the world of business. - [892%]( - That's how much shares of Ostin Technology (OST, NDAQ), a China-based display-module maker, rocketed on the firm's market debut last week. It was the first IPO by a China-based firm on a US stock exchange since mid-February. However, the markets quickly cooled off on Ostin’s electrifying listing, and the stock eventually ended the week below its IPO price of US$4.00 per share. - [US$540 million]( – That's how much Indian IT giant Wipro (WIPR, NSE) agreed to pay in cash to buy US-based SAP consulting firm Rizing Intermediate Holdings last week. The transaction is expected to be completed before June 30. Wipro also [reported]( a 28.4% jump in quarterly revenues, but a significant rise in operational expenses meant that its net income for the fourth quarter rose just 4% to US$406.9 million. THE 1 YOU DIDN'T SEE COMING We spotlight the unusual, not-your-everyday kind of story that has got everyone talking and social media buzzing over the past week. Social media’s busy week: Big deals, massive earnings, and… sharing IP addresses? You've probably heard this already, but we have to mention the largest-ever acquisition by a single person. Yes, the Elon Musk-Twitter (TWTR, NYSE) saga ended in favor of the world’s richest man, who will be taking the microblogging platform [private]( in a deal worth US$44 billion. On to another company that tried to acquire Twitter, not once but twice: Meta Platforms (FB, NDAQ). The social media giant’s shares were due for a rally after having lost nearly half their value this year. The pressure valve was loosened last week as Meta surprised Wall Street with a [better-than-expected rise]( in new users on its platforms, sending shares up 17%. Meanwhile, Weibo Corp (WB, NDAQ) has resorted to a rather [unusual tactic]( to combat misinformation and “bad behavior” on its platform. Twitter's Chinese counterpart, which has over 570 million monthly active users, has surprisingly opted to start publishing its users’ IP locations on their account pages and when they post comments. Weibo has been on the receiving end of several fines from China's cyberspace regulator over the past year. Meanwhile, those posting on the platform from overseas will have details of their country displayed. That’s it for this edition - we hope you liked it! Not your cup of tea? You can unsubscribe from this newsletter by going to our preference center at the bottom of this email. Happy investing and see you next week! Disclaimer: This content is for informational purposes only. Kindly do not construe any such information as legal, tax, investment, financial, or other advice. [ADVERTISE]( | [SUBSCRIBE]( | [HIRE]( | [FIND JOBS]( P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? Switch to a different frequency or get new content through our [preference center]( or [unsubscribe](. You can also break our hearts and remove yourself from all Tech in Asia emails over [here](. Copyright © 2022 Tech in Asia, All rights reserved. 63 Robinson Road, Singapore 068894