• 4Q23 GTV came in at IDR 163tn (+7.8% QoQ, +0.7% YoY), accompanied by a top line of IDR 4.3tn (+17.9% QoQ, +26.5% YoY) and a net take rate of 2.62% (3Q23: 2.4%, 4Q22: 2.09%). Also, GOTO achieved a positive adjusted EBITDA of IDR 77bn (3Q23: -IDR 0.9tn, 4Q22: -IDR 3.1tn), aligning with our expectations and management guidance. This improvements on the back of several cost cutting measures: 4Q23 promotion budget of IDR 2.2tn (3Q23: IDR 2.3tn, 4Q22: IDR 2.9tn), and its 4Q23 incentive and product marketing budget dropped by -33% YoY (FY23: -38% YoY).
• Cumulatively, GOTO posted revenue of IDR 14.8tn (+30.8% YoY), beating our estimate (116.5%) but falling short of cons (96.7%), with a net take rate of 2.4% and a full-year contribution margin of IDR 4.4tn for the whole year (vs –IDR 6.3tn in FY22). The company also posted adjusted EBITDA of –IDR 3.7tn (-2.1% YoY, though still better than guidance) and a net loss of –IDR 90.4tn (FY22: -IDR 39.6tn), though the majority of the net loss (-IDR 78.8tn) came from goodwill reversal following Tokopedia - TikTok integration.
• Management aims to book a break-even EBITDA in FY24F, emphasizing profitability through further cost-cutting and new partnerships, as well as USD 200mn buyback, signaling confidence in GOTO’s growth prospects despite goodwill write-off and tight competition. Following this result release, we maintain our positive stance on the company and view the recent share price weakness as a buy opportunity. Buy with Target Price of IDR 120, reflecting FY24F EV/sales of 11.69x (ex. Tokopedia).