GrabTaxi worth more than AirAsia? (2)

I wrote about this issue before.

Since then GrabTaxi (EasyTaxi in Malaysia) raised another round of USD 350 million. I estimate at a valuation of about USD 2 billion, or about RM 9 billion.

AirAsia has a marketcap of about RM 3.6 billion, AirAsiaX of about RM 800 million, so together these two companies are valued at about half the valuation of a four year old company, which is basically an apps.

I don't make any value judgement here, just observe something that sounds interesting and may be controversial.

Apparently Tony Fernandes also noticed the high valuation of GrabTaxi and some other "unicorns" (start-up companies valued at above USD 1 Billion). At a recent event, he mentioned:


“Essentially, we are an Internet company. We see ourselves as an Internet company. We have a tremendous amount of Internet potential,” he told the audience at Digital News Asia’s inaugural What's Next conference in Cyberjaya yesterday (Sept 29).
 
“More than 20% of our business comes from ancillary income,” he said.
 
 The AirAsia Group has invested in or kicked off several ventures, such as AAE Travel (a joint-venture between AirAsia and Expedia); the Asian Aviation Centre of Excellence; Think Big Digital (a joint-venture between AirAsia and Tune Money which operates the AirAsia BIG loyalty programme); and it also has a 40% stake in Tune Money.
 
 These are not Fernandes’ only ventures. He also owns the Tune Group which has investments in Tune Talk, Tune Hotels, Tune Protect, Tune Studios, Tune Labs (a venture company looking at tech startups), and more.
 
Unsurprisingly, the Internet plays an essential part in most, if not all, of these businesses. Indeed, many industry pundits have credited Tony and AirAsia for breaking down e-commerce barriers in Malaysia.


 Does that mean that Tony wants an internet valuation for his company, not an airline valuation? If so, will he get that?

Time will tell.

GrabTaxi worth more than AirAsia?

According to this article in the Wall Street Journal:


More cash is pouring into the increasingly competitive ride-hailing business in Asia, fueling local competitors to global market leader Uber Technologies Inc.

Southeast Asia-focused ride-hailing app GrabTaxi is getting an infusion of over $200 million in fresh capital in its latest fundraising round led by U.S. hedge fund Coatue Management LLC, according to a person familiar with the situation. The investment values the company at over $1.5 billion including the fresh capital from the latest fundraising, according to the person.


USD 1.5 Billion is equivalent to RM 5.7 Billion, clearly higher than the current marketcap of AirAsia, which is RM 4.4 Billion.

Is that really fair, if we look at revenue, profits, assets, barriers to entry (landing rights) etc?

I have doubts about that, but time will tell.

Regarding a company operating in the same industry (but on a global level), Uber, an article asks the question:

"Uber is seeing $470M in operating losses: Can it ever be profitable?".