Blog > Marketplace News > The Share Price of Shopee’s Parent Company Fell Sharply After TikTok Shop Returned To Indonesia
The Share Price of Shopee’s Parent Company Fell Sharply After TikTok Shop Returned To Indonesia
Jayson 13 Dec 2023 08:22
Analysts said Shopee will face "increased pressure" from Tokopedia and TikTok's cooperation in Indonesia.
Just on Monday, GoTo and TikTok announced a "mutually beneficial strategic partnership" in Indonesia to serve micro, small and medium-sized enterprises, which make up more than 90% of the country's merchants.
"We believe the deal could also put more pressure on Shopee as it also struggles to maintain profitability," senior equity analyst Wang Kai said in a note on Monday.
U.S.-listed shares of Shopee parent company Sea closed down 5.33% at $37.87 after the partnership announcement.
Jianggan Li from Momentum Works said the GoTo-TikTok deal was a "masterstroke." "TikTok Shop will gain full operational control, legality to operate e-commerce and some useful local allies," he said in an analysis on Monday.
"Shopee cannot beat TikTok Shop head-on by relying solely on e-commerce products, operations and revenue. Shopee needs a very clear strategy to win this game, and the key to winning may not lie in e-commerce," Li said.
"Given that live-streaming e-commerce on social media platforms such as TikTok has recently grown faster than traditional e-commerce platforms, we believe Sea may increase operating expenses," Wang Kai said, adding that this could lead to "profits from live-streaming e-commerce." rate dropped”.
It's also worth noting that GoTo stock also fell about 20% on Monday as it relinquished control of Tokopedia.
Just on Monday, GoTo and TikTok announced a "mutually beneficial strategic partnership" in Indonesia to serve micro, small and medium-sized enterprises, which make up more than 90% of the country's merchants.
"We believe the deal could also put more pressure on Shopee as it also struggles to maintain profitability," senior equity analyst Wang Kai said in a note on Monday.
U.S.-listed shares of Shopee parent company Sea closed down 5.33% at $37.87 after the partnership announcement.
Jianggan Li from Momentum Works said the GoTo-TikTok deal was a "masterstroke." "TikTok Shop will gain full operational control, legality to operate e-commerce and some useful local allies," he said in an analysis on Monday.
"Shopee cannot beat TikTok Shop head-on by relying solely on e-commerce products, operations and revenue. Shopee needs a very clear strategy to win this game, and the key to winning may not lie in e-commerce," Li said.
"Given that live-streaming e-commerce on social media platforms such as TikTok has recently grown faster than traditional e-commerce platforms, we believe Sea may increase operating expenses," Wang Kai said, adding that this could lead to "profits from live-streaming e-commerce." rate dropped”.
It's also worth noting that GoTo stock also fell about 20% on Monday as it relinquished control of Tokopedia.
