Stock ticker–
GRAB ($GRAB)
Stock Name and Trading Stock Exchange Platform–
GRAB holdings limited GRAB-NASDAQ
The stock sector–
GRAB (formerly Grab taxi/My taxi) is a Southeast Asia-based technology company specializing in–
- the transport mobility,
- delivery, and
- mobile payment sectors.
It was started in Malaysia by Antony Tan as a ‘super app’ for taxi bookings in 2012. It has very much evolved venturing into several industries such as–
- E-commerce,
- financial services,
- online payments,
- parcel delivery, and others.
- Food delivery is another sector that plays a huge role in its operations.
GRAB is considered the largest technology start-up in Southeast Asia.
Recent News
GRAB has been buzzing in mainstream media as it released its fourth-quarter (Q4) reports. GRAB stock was hammered as the results revealed that its revenues had slumped by -44%. This translated to $1B in net losses with investors losing massive capital.
GRAB’s capitalization fell by nearly -40% when the results were released in March 2022. This amounted to a share loss of about $30B. This has been considered GRABS’ worst week since its listing.
GRAB will likely remain in the limelight for a long period to come due to uncertainty in the direction of its share price.
Current Position of GRAB
GRAB is headquartered in Indonesia and Singapore (Previously in Malaysia) and operates in many countries like Thailand, Cambodia, Vietnam, the Philippines, and Myanmar, with over 6000 employees.
GRAB has received a lot of criticism for underperformance based on its Q4 results. GRAB was largely impacted by the covid pandemic in early 2020 and this saw a decline in its operations. However it bounced back strongly and had a great run in the 2020/21 fiscal year.
In an interview with Bloomberg technologies, GRAB’s president Ming Maa remarked that it was one of their best years with a 44% increase in growth revenue and 74% retention rates of its customers.
GRAB was also able to gain solid margins and mobility. GRAB said their goal is building long-term value even if they bleed in the short-term.
The situation looks pretty grim for GRAB right now with almost half of its value wiped out last week. GRAB went public in December 2021 via a non-conventional IPO called a SPAC (special purpose acquisition company).
This is a company whose sole operation is to merge with other companies to raise capital and are typically labeled ‘blank-cheque companies’. GRABS merged with the Altimeter growth Corp (AGC), a SPAC, raising a record-high of $4.5 billion in the deal and a valuation of nearly $40 billion.
This success quickly de-escalated as GRAB lost -20% of its value on the first trading day.
Regulators and analysts are very sceptical about SPAC activity but it has nevertheless gained popularity as several known companies have taken this road. GRABS’ recent plunge has reinforced the perception that SPAC deals are not properly scrutinized and evaluated.
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GRAB HOLDINGS LIMITED ANALYSIS AND REVIEW
Should I buy shares in the $GRAB stock?
Stock ticker–
GRAB ($GRAB)
Stock Name and Trading Stock Exchange Platform–
GRAB holdings limited GRAB-NASDAQ
The stock sector–
GRAB (formerly Grab taxi/My taxi) is a Southeast Asia-based technology company specializing in–
- the transport mobility,
- delivery, and
- mobile payment sectors.
It was started in Malaysia by Antony Tan as a ‘super app’ for taxi bookings in 2012. It has very much evolved venturing into several industries such as–
- E-commerce,
- financial services,
- online payments,
- parcel delivery, and others.
- Food delivery is another sector that plays a huge role in its operations.
GRAB is considered the largest technology start-up in Southeast Asia.
Recent News
GRAB has been buzzing in mainstream media as it released its fourth-quarter (Q4) reports. GRAB stock was hammered as the results revealed that its revenues had slumped by -44%. This translated to $1B in net losses with investors losing massive capital.
GRAB’s capitalization fell by nearly -40% when the results were released in March 2022. This amounted to a share loss of about $30B. This has been considered GRABS’ worst week since its listing.
GRAB will likely remain in the limelight for a long period to come due to uncertainty in the direction of its share price.
Current Position of GRAB
GRABis headquartered in Indonesia and Singapore (Previously in Malaysia) and operates in many countries like Thailand, Cambodia, Vietnam, the Philippines, and Myanmar, with over 6000 employees.
GRAB has received a lot of criticism for underperformance based on its Q4 results. GRAB was largely impacted by the covid pandemic in early 2020 and this saw a decline in its operations. However it bounced back strongly and had a great run in the 2020/21 fiscal year.
In an interview with Bloomberg technologies, GRAB’s president Ming Maa remarked that it was one of their best years with a 44% increase in growth revenue and 74% retention rates of its customers.
GRAB was also able to gain solid margins and mobility. GRAB said their goal is building long-term value even if they bleed in the short-term.
The situation looks pretty grim for GRAB right now with almost half of its value wiped out last week. GRAB went public in December 2021 via a non-conventional IPO called a SPAC (special purpose acquisition company).
This is a company whose sole operation is to merge with other companies to raise capital and are typically labeled ‘blank-cheque companies’. GRABS merged with the Altimeter growth Corp (AGC), a SPAC, raising a record-high of $4.5 billion in the deal and a valuation of nearly $40 billion.
This success quickly de-escalated as GRAB lost -20% of its value on the first trading day.
Regulators and analysts are very sceptical about SPAC activity but it has nevertheless gained popularity as several known companies have taken this road. GRABS’ recent plunge has reinforced the perception that SPAC deals are not properly scrutinized and evaluated.
The metrics and operations of a company are not known by investors in a typical IPO, hence little information is known on the prospect of the company increasing risk. GRAB’s overall activity has nonetheless increased and it has the lion’s share in the Southeast Asian markets.
In terms of market dominance, GRAB is a notch higher than its regional competitors which include titans like Gojek Tokopedia (GoTO), and Neuron Mobility, but it still faces stiff competition in the global markets.
GRAB has diversified its holdings and owns subsidiaries which include–
Grab Financial group & iKaaz Software Private limited, and others.
GRAB Stock Price Chart
GRAB is at least -75% down compared to its trading price of $13, a share when it went public.
GRAB has traded at a yearly range of $3.09-$17.09. Its day range is lower at $3.27-$4.18 a share. The volume of shares is 30.79 million. GRAB has not quite performed exceptionally despite having established institutional investors owning a substantial stake in it.
- Softbank Investment (UK) Limited is the largest shareholder owning 18% of GRAB,
- Uber Technologies, the ride-hailing giant, has a 14% share in common stock and
- Chuxing Didi holds 7.1%. The general public holds 55% of the total shares.
GRAB is still in its growth phase and cannot be conclusively analyzed to determine performance. It is quite clear that it has underperformed and has a long way to go before delivering solid market expectations.
Revenue was at a staggering high in 2020 at $198M. the total segment of EBITDA margins also improved by 50% in the former fiscal year.
The single largest factor hampering its performance is internal limitations. GRAB is focused on driving cost reduction of its general enterprise and that of its ecosystem. GRAB has credited the declined growth to its massive funding to improve driver supply and incentives.
It has a current market capitalization of $12 billion which is below its all-time high by a factor of at least three.
GRAB is cash strapped and heavily reliant on funding from investors, stock sales, and its operations. It is still trading below expectations and a further market collapse could have devastating effects on its operations.
Sentiment
The market has had a sour reaction to GRAB’s underperformance. Although it is the darling start-up in Southeast Asia, investors are majorly interested in the financials and not the underlying business structure.
It has a strong business model and is arguably undisputed in its operating region. GRAB is a household name that will likely wither the storms to come.
However, in the face of uncertainty, Capital goes where it is massively and rapidly returned.
With threats of a looming war. Economic crisis and health hazards, global money will run to safe havens where value is maintained. GRAB’s volatility and slow growth tend to discourage investors from acquiring it. Even though its fundamentals are strong it is still a start-up and will likely see more boom and busts heading its way before it takes off proper.
GRAB is still trading below its all-time high and analysts’ ratings recommend a 77% buy, 15% hold, and 8% sell. A lot of contradictory information has been spurred concerning GRAB. Its position could either work for or against it.
Generally, it can be agreed that GRAB is the initial phase of development in the market and will eventually become an unstoppable force in the distant future. This is considering the vast resources and intelligence it puts into research working with world-class experts.
Profits
GRAB is a start-up that currently is not profitable. Most of its resources go to its expansion and ensuring efficient operations. The net profit margin in the last financial year was down by -359.85%. NET income was estimated at -$712.50 million. They also do not have any available cash in hand.
These factors scare investment away and trigger capital flight, but one should also consider that GRAB Earnings per share (EPS) was last recorded at-$0.084 indicating very little debt. It also had a YTD of -54%.
Hopefully, as they solidify and gain financial strengths, the path to profitability could be achieved.
Future of GRABS
To understand the fate of this organization we must consider it’s activities based on technical and fundamental standpoint.
Fundamentally, Grab is pivotal in the day-to-day lives of–
- drivers,
- merchants, and partners in the
- food/grocery supply,
- packages,
- ride-hailing,
- FinTech,
- insurance,
- wealth management through its ‘all-in-one super app’.
GRAB has made great strides in forging strategic partnerships with big players such as McDonald’s, Ascenda, Marriot international, and Mastercard. Although it is seeing lateral movement showing no quick massive surges, GRAB has a rock-solid foundation that will see it stand the test of time.
GRABS boasts 214 million app downloads in 400 cities as revealed by a recent survey. It has 5 million registered driver-partners across the globe. It has been ranked as the fastest-growing start-up and most innovative start-up in Southeast Asia. GRAB is a unicorn and as it is characteristic of them, astronomical growth is seen at a strategic point in their development.
Technical analysis shows that the GRAB stock chart takes a bull pennant pattern. This is an indicator showing the impending of a strong upward price move. At the end of February 2022, it had seen the volume of shares fall by 6 million shares.
A key consideration is that falling volume on higher prices causes divergence and this may be an early warning. This is considered bullish and predictions say it could fall -31% during the next three months. It is a sell signal where the long-term average is above the short-term average. A discord therefore exists, between its technical and fundamental inferences.
Analysts forecast that it will rise to a low of $4.76 and a high of $13 a share in the next 12 months.
Overall verdict
GRAB is not currently favored by the markets. Continued volatility will be witnessed in the short term, but the great prospects lie ahead. If it can miraculously resolve internal disarray and focus on increasing production, it will then thrive in a fairly nominal market in the long haul.
source: tabstocks
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