Bukalapak CEO Resigns Months Soon after Major Indonesian E-Commerce Firm’s Historic IPO Shares Fall

Shares of Bukalapak fell on Thursday after Rachmat Kaimuddin resigned as CEO a several months following top the e-commerce firm’s historic first public offering on the Jakarta Inventory Exchange.

Bukalapak mentioned it has appointed Willix Halim, at this time the company’s chief functioning officer, as interim CEO following Kaimuddin’s resignation. Its shares fell as a lot as 4.9% in Jakarta buying and selling currently, touching an all-time reduced of 430 rupiah.

The organization manufactured background in August after raising $1.5 billion from its IPO, the country’s most significant-ever maiden share sale. The shares to begin with rallied, leaping 25% on its initial investing day, but sentiment turned bitter quickly as investors wondered how Bukalapak can compete against much larger e-commerce players these kinds of as homegrown GoTo, which was formed from the merger of Gojek and Tokopedia in Might, and Singapore-primarily based rivals this sort of as Seize and Sea Group’s Shopee. The shares are now down practically 60% from its IPO rate of 850 rupiah apiece.

“The CEO’s departure confirms our fears about the company’s vulnerabilities,” Nirgunan Tiruchelvam, Singapore-based head of client sector equity exploration at Tellimer, explained via textual content messaging. “The corporation is at finest a marginal participant with an unsettled management staff.”

Tiruchelvam initiated coverage of Bukalapak this thirty day period with a offer rating and goal rate of 413 rupiah for each share. “Bukalapak is a peripheral participant that will be eroded by market place leaders Sea, Grab and GoTo,” he claimed in his initiation take note. “As the fourth-biggest participant in Indonesia’s e-commerce sector, Bukalapak has only 7% market share, and it will be restricted by its lack of scale.”

Kaimuddin is leaving Bukalapak to operate for the federal government two yrs following getting appointed CEO in 2019, in accordance to the company. The former financier was tapped for the occupation mainly because the company’s buyers noticed him as the appropriate individual to staunch the flow of red ink and set the 11-year-old business on a route of profitability. 

While the company stays in the pink, Kaimuddin is credited for bringing in bluechip investors into the company. Bukalapak’s roster of buyers contains Singapore’s sovereign prosperity fund GIC, China’s Ant Group, U.S. tech huge Microsoft, Typical Chartered bank and South Korean world-wide-web portal Naver Corporation, among the other folks.

“We have been incredibly positively stunned with the momentum and the degree of fascination from both of those domestic and worldwide investors,” Alvin Sariaatmadja, president director of Emtek, the major shareholder of Bukalapak, informed Forbes Asia just right before the tech unicorn detailed.