IPO news: Treasure Global is set to go public next week; here’s what to know

E-commerce and e-payment have become the norm these days. The companies operating in this space are focusing their efforts on making the customer experience as smooth and seamless as possible through technology. One such company is Treasure Global which is set to make its market debut next week. Here’s what to know about this new entrant:

IPO details   

Treasure Global Inc. is set to go public on Thursday, July 14. It will begin trading on the NASDAQ under the symbol TGL. The company will offer 3 million shares at a price range of $4 to $6. The IPO will be managed by EF Hutton.

Company intro

According to its filings, Treasure Global is the creator of an online-to-offline (O2O) e-commerce platform business model that offers consumers and merchants instant rebates and affiliate cashback programs. It provides a seamless e-payment solution with rebates in both e-commerce (online) and physical retailers (offline) settings.

The company’s proprietary product is an app named ZCITY App, which targets consumers by providing personalized deals based on their purchase history, location and preferences. Its technology platform helps it identify the spending trends of customers.

The company uses artificial intelligence (AI) to analyse consumer behavior and roll out attractive rewards-based campaigns for targeted audiences. It believes this AI technology is a unique market differentiator for the ZCITY App.

As of June 7, 2022, the company has on boarded over 1,708,466 registered users and 1,998 registered merchants onto its ZCITY platform. Its longer-term goal is for the ZCITY App to become one of the most well-known commercialized applications more broadly in Southeast Asia and Japan.

Financials

Total revenues increased to approx. $63.4 million for the nine months ended March 31, 2022 from approx. $0.4 million in the same period a year ago. The increase was driven mainly by an exponential growth in registered users of the company’s ZCITY platforms.

The company acquired 898,340 new registered users for the nine months ended March 31, 2022 compared to 340,388 new registered users for the same period in 2021. The growth in users enhanced the traffic of its platform and allowed it to monetize its revenue streams including product revenue, loyalty program revenue, transaction revenue and agent subscription revenue.

The company’s net loss increased from approx. $4.2 million for the nine months ended March 31, 2021 to approx. $9.2 million for the nine months ended March 31, 2022.

Market opportunity

Treasure Global believes that continued strong economic expansion, robust population growth, rising level of urbanization, the emergence of the middle class and the increasing rate of adoption of mobile technology will provide market opportunities for it in Southeast Asia (SEA). SEA is a large economy and, as of 2020, its gross domestic product (GDP) was $3.08 trillion.

Despite the ongoing effects from the COVID-19 pandemic, the Internet economy continues to boom in SEA. According to the Google Temasek e-Conomy SEA 2021 Report, internet usage in the region increased with 40 million new users added in 2021 for a total of 440 million compared to 400 million in 2020 and 360 million in 2019. According to the Google Report, the SEA Internet sector GMV is forecast to grow to over $360 billion by 2025.

As consumers in these markets continue to shift towards online platforms, the total value of internet-based transactions is expected to grow. The company believes that these positive economic and demographic trends in SEA and South Asia will propel demand for its e-commerce platform.

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