Disclosures & DisclaimerThis report must be read with the disclosures and the analyst certifications in the Disclosure appendix, and with the Disclaimer, which forms part of it.MCI (P) 028/02/2021 MCI (P) 087/10/2020Issuer of report: The Hongkong and Shanghai Banking Corporation Limited, Singapore BranchView HSBC Global Research at:https://www.research.hsbc.comRegister nowHSBC 8th Annual China Conference10-21 May 2021 Shopee MSME partner network expands to >4m across Indonesia vs. Gojek’s 900k merchant partners as of FY20 Food delivery segment is getting competitive as Traveloka expands; but this should further accelerate user adoption Shopee app download surges to 2.5x of Lazada and Garena ranking remains robust in the month of April 2021This report highlights key e-commerce, food delivery and FinTech trends across ASEAN. It also highlights Garena’s ranking and e-commerce app downloads trends.Shopee aims to on-board 10000 MSME exporters from Surakarta (Solo) by 2021, as it has signed collaboration with the Surakarta City Government. The collaboration is intended to develop the MSME’s (Micro, Small and Medium Enterprises) of the region and educate them in funding, online marketing, payment and logistics systems, and exports. Food delivery in Indonesia – rising competition vs. faster adoption rate? Competitive intensity to rise as Traveloka is scaling ‘Traveloka Eats’ platform by on-boarding new restaurants and charging lower commissions. On the other hand, this should support faster merchant adoption and drive faster user penetration. Gojek and Tokopedia likely to form ‘GoTo’: As per media reports, Gojek and Tokopedia have agreed to merge and now seek investor approval. The merged entity is stated to be called ‘GoTo’. Gojek will hold 58% in the merged entity while Tokopedia shareholders will own the remaining 42%. The proposed merger could strengthen the merged entity’s competitive positioning in Indonesia with wider consumer use cases, but allocating scarce capital would be critical to successful consolidation.Gojek’s Sustainability Report 2020 reveals: The company is very well positioned with more than 20 consumer use cases (Exhibit 1), it has 2m+ registered driver partners, 900k merchant partners (96% MSMEs) and it has shared sustainability targets for 2030. See page 10 for further details.Shopee downloads surge in April-21: Shopee’s new downloads were 2.5x those of Lazada in the month of April 2021, as per Sensor Tower. We note 95% of Shopee orders are placed via its mobile app; hence such a lead is substantial. Garena’s ranking remains robust in April-21 and revenue per day is +53% y-o-y.Maintain Buy on Sea Ltd. (SE US) with unchanged TP of USD300: Shopee is well poised to gain leadership due to its competitive positioning, as it leverages its strong balance sheet and prioritises growth.10 May 2021Piyush Choudh...
