by Jan Michael Carpo, Reporter
GCash, the leading e-wallet service in the Philippines, is poised for exponential growth and possibly the largest initial public offering (IPO) in the country’s history.
The company, owned by Globe Fintech Innovations Inc. (Mynt), recently secured substantial investments from prominent entities, including the Zobel family through Ayala Corp. and Japan’s largest bank, Mitsubishi UFJ Financial Group (MUFG).
PH’s leading e-wallet service provider GCash is poised for exponential growth and possibly the largest IPO
These investments have propelled the e-wallet’s valuation to an impressive US$5 billion, more than doubling its previous worth of US$2 billion.
This influx of capital has sparked speculation about GCash’s plans to go public, with analysts predicting it could make a historic debut on the stock market.
At its just-concluded FutureCast 2024 event, the company gave Filipinos a great preview of all the improvements that the e-wallet company was making with its platform, announcing new improvements geared towards added convenience.
Martha Sazon, the President and CEO of GCash, passionately highlighted the company’s mission, saying, “Today, you can expect innovations that will change the game.” “But the real game-changer,” she adds, “is how we can make a meaningful impact on Filipino lives. We innovate not just to provide access but to be partners towards better financial health and wellness.”
Underscoring GCash’s viability as a business
According to a survey conducted among industry experts, Mynt’s financial performance and strategic investments position it well for a potential IPO. Mynt reported a profit of P6.7 billion at the end of 2023, underscoring GCash’s viability as a business.
Juan Paolo Colet, managing director of China Bank Capital Corp., noted that the recent funding round could signal Mynt’s readiness for an IPO, potentially the largest in Philippine history.
“If Mynt chooses to list locally, the IPO could be priced higher than the current US$5 billion valuation, making it a landmark event,” Colet said. He added that the company might also consider listing overseas, in a market with a strong appetite for fintech innovations.
Luis Limlingan, head of sales at Regina Capital Development Corp., echoed this sentiment, highlighting that the new investments could help GCash explore new growth avenues and enhance customer experience.
“With MUFG’s entry, GCash can leverage its expertise to solidify its position in the fintech sector,” added Limlingan. He also suggested that these investments might be a preparatory step for going public, allowing Mynt to gauge market conditions and timing for the IPO.
Ayala Corp., a significant player in Mynt’s investment landscape, expressed confidence in GCash’s growth trajectory. The conglomerate’s subsidiary, AC Ventures Holdings Inc. (ACV), increased its stake in Mynt by 8%, investing an estimated P22.9 billion. This move raises ACV’s total ownership to 13%, a testament to the Zobel family’s belief in the long-term potential of GCash.
Cezar Consing, president and CEO of Ayala Corp., emphasized GCash’s capacity to reach untapped markets. “We see tremendous growth opportunities for GCash, especially in serving underserved Filipino consumers and businesses. It is a clear leader in a fast-growing sector and a crucial driver of the Philippine economy,” Consing stated.
Since its inception, GCash has been a pioneer in the Philippine fintech space, offering a comprehensive range of financial services, including instant loans and cash transfers. The platform’s extensive user base and innovative services have made it the country’s largest finance app.
Ernest Cu, president and CEO of Globe Telecom Inc., hinted at GCash’s readiness for an IPO as early as 2023, though he acknowledged that market conditions would be a critical factor in finalizing the timeline. “While we are prepared for an IPO, we are closely monitoring the macroeconomic landscape and market sentiment,” Cu said.
As GCash continues to expand its offerings and user base, the company is well-positioned to capitalize on the growing demand for digital payments in the Philippines. The new investments not only bolster its financial standing but also open up opportunities for further innovation and market penetration.
The coming months will be crucial for GCash as it navigates the complexities of going public. Whether it chooses to list locally or abroad, the e-wallet’s IPO is expected to be a significant event in the Philippine fintech landscape, potentially setting a new benchmark for the industry.