AirAsia’s super app roadmap sets up ride-hailing battle for Bangkok

Opening Bell 🔔 is Tech in Asia’s free newsletter that brings you the biggest news and latest trends around Asia’s publicly listed 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](. --------------------------------------------------------------- Written by Shravanth Vijayakumar Journalist Hello {NAME} No one can accuse AirAsia of not going full throttle to achieve its super-app dreams in Southeast Asia. Since rebranding earlier this year to Capital A (CAPI, KLSE) to reflect its ambition to grow beyond its core budget airline, the firm has built a super app that offers at least 16 different products, including ticketing and ecommerce. While the firm’s super app-related efforts in the region are laudable, the cost of such rapid expansion must be weighed against its precarious financial position. AirAsia’s balance sheet took a major beating during the Covid-19 pandemic - when the budget carrier had to ground 96% of its fleet. Its strained finances led to Malaysia's stock exchange classifying the firm as a Practice Note 17 (PN17) company - one that is financially distressed. While Tony Fernandes, Capital A’s CEO, has been quick to sweep that detail under the carpet, the issue continues to be a nagging thorn in the company’s side. Capital A is attempting to ease the pressure on its balance sheet - especially its cash position - by raising funds through various sources, including [potentially listing]( its low-cost airline business AirAsia and its super app in the US next year. However, its funding drive has hit several roadblocks as sketched out in [this Tech in Asia premium story](. All that makes AirAsia’s super-app quest in Southeast Asia a tantalizing one. The company needs to strike a fine balance between its far-from-ideal financial state and its skyrocketing ambition. While it’s hard to keep track of all the businesses the Malaysia-based firm is launching in various Southeast Asian markets, today’s edition of the Opening Bell will focus on its ride-hailing business, AirAsia Rides, in Thailand - more specifically, in Bangkok. Given its financial struggles, Capital A’s move to make inroads into a saturated market is a bit of a head scratcher. But that’s where my colleague Xavier steps in, highlighting how AirAsia has built on Gojek’s Thailand operations - which it acquired last year - to battle incumbent players like Grab (GRAB, NDAQ) in Bangkok. Further, the featured story also brings to the fore AirAsia’s “drivers keep 100% of fares” policy in Thailand and the advantage that the firm has in servicing tourists through its super app, offering an end-to-end travel services for customers, from hotels and flights booking to itinerary planning, and now, airport transfers. -- Shravanth  --------------------------------------------------------------- THE BIG STORY [AirAsia Rides builds on Gojek’s operations to battle Grab in Bangkok]( AirAsia Rides is hoping its acquisition of Gojek’s ride-hailing operations in Thailand will help it establish a beachhead in Bangkok.  --------------------------------------------------------------- 3 TRENDS TO KEEP AN EYE ON Hot stocks, earnings reports, restructuring, pressure from activist investors, and more. 1️⃣ Scaling back at Sea: There has been a lot of news coming out of Sea Group (SE, NYSE) lately, but it’s generally not the kind one would expect from the Singapore-based tech behemoth. Sea has gotten plenty of plaudits over the years for its phenomenal rise not only in gaming, through Garena, but also in ecommerce, through Shopee. However, priorities are bound to shift when a company loses nearly US$170 billion in market value after peaking in October. The era of Sea’s rapid growth has hit a bit of a pause, with the focus now more on preparing the firm against the impact of any economic downturn.  Visual story: [Sea Group’s financial health in 9 charts]( In the latest slew of [cost-cutting measures]( Sea's top management [are forgoing their salaries]( with CEO Forrest Li saying that the leadership team would not take any cash compensation until the tech giant reaches self-sufficiency. Nonetheless, they will continue to receive stock-based awards, with Sea doling out a tidy US$184.1 million in share-based compensation in just [the second quarter alone](. 2️⃣ The hardships of being a deep-pocketed tech giant: The timeline of Google’s (GOOGL, NDAQ) run-ins with regulators around the world is quite staggering and somewhat explains why big tech’s reputation has been on the wane. If it seems like the US-based search engine faces some regulatory hurdle or legal challenge every other day, there’s good reason for that. In just the last week alone, Google was fined 4.1 billion euros (US$4.1 billion) after a top European court upheld a ruling that the company broke competition rules, it is facing claims of up to 25 billion euros (US$25 billion) over its adtech practices in British and Dutch courts, and its the subject of a probe into anticompetitive practices in Mexico.  Read more: [Behind the rise of Google Classroom in Indonesia]( In a hardly surprising turn of events, the Alphabet-owned company is now also in hot water with authorities in Indonesia, Southeast Asia’s largest economy. Indonesia’s antitrust agency, too, [has started probing]( the tech titan for alleged monopolistic and unfair practices. 3️⃣ Third time's the charm?: When I started my career in business journalism during the highs of the 2017 bull market, I recall praise being lavished upon Masayoshi Son, SoftBank’s (9984, TYO) founder and CEO, for transforming the Japanese telecom giant into a sprawling investment conglomerate. Hailed as Japan’s answer to investment guru Warren Buffett, Son rose to prominence following some stellar bets in the tech industry - most notably his early investment in Alibaba (BABA, NDAQ). However, times are a lot tougher now, with SoftBank reporting a jaw-dropping quarterly loss of US$23 billion in August, largely due to the falling valuations of portfolio companies in its Vision Fund, the world’s largest tech-focused fund. Now the the firm is mulling the launch of [a third startup fund with its own cash]( after the poor returns from its previous two. The development comes after SoftBank cut at least 20% of the headcount at its Vision Fund unit.  See also: [Tracking layoffs across Asia’s startup ecosystem (Updated)](  ---------------------------------------------------------------  2 EYE-POPPING FACTS Tech in Asia scours the internet to bring you head-turning numbers from the world of business. [1,600%]( - iCandy Interactive (ICI, ASX), an Australia-listed gaming group, has ridden the wave of Web3 gaming to post a whopping 1,600% rise in H1 2022 revenue. Further, the company also became operationally profitable for the first time in its seven-year history. In an in-depth interview, chairman Lau Kin Wai tells Tech in Asia that he believes there is a lot more to come and also discusses iCandy’s vision for the future. [73]( - These were the number of titles granted publishing licenses by China's gaming regulator last week. Most notably, the latest batch of approvals also included games from Tencent (0700, HKG) and NetEase (9999, HKG) - the nation’s largest gaming firms. This marks the first time that games of both companies were approved since Chinese regulators froze all licensing in 2021.  --------------------------------------------------------------- THE ONES 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.  Asia’s exchanges get to work, and an alleged liar in the midst In a move designed to retain Hong Kong’s allure as a financial hub and boost public listings - which has fallen 90% so far this year - in the region, exchange operator Hong Kong Exchanges and Clearing (0388, HKG) is likely to [lower]( the threshold for listings of hard tech companies such as chip makers and AI firms. Meanwhile, the Singapore Exchange (S68, SGX) is looking to take a harder stance when it comes to disclosure of executive compensation, with plans to change its corporate disclosure rules to [require]( companies to reveal exactly how much their executives are paid. Lastly, in a Hollywood-esque story of twists and turns, [this Tech in Asia premium piece]( outlines how a startup allegedly lied about an Apple (APPL, NDAQ) and LVMH (MC, EPA) investment and leveraged that alleged lie to raise money from investment firm Candy Ventures. Currencies converted from the euro to US dollar: US$1=1 euro  --------------------------------------------------------------- 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