Leading mobile wallet and fintech platform GCash continues to gain traction ahead of a planned initial public offering (IPO) that could value the company at $6 billion (P350 billion), eclipsing the value of some of the Philippines’ largest banks.
“I wouldn’t be surprised if Mynt will be valued at $5-$6 billion or more when it IPOs,” Abacus Securities’ research head Nicky Franco said, referring to GCash’s parent company known as Globe Fintech Innovations Inc. or Mynt.
The target valuation surpasses Metropolitan Bank & Trust, the country’s second-largest lender, with a market capitalization of around P300 billion, and is close to Ayala Corp.’s P365 billion.
This reflects the premium investors are placing on digital innovations in the financial sector.
Dual listing
In a recent interview with Bloomberg News, Globe Telecom CEO Ernest Cu said they might pursue a dual listing IPO in the Philippines and overseas in 2025.
With over 90 million users, the venture between the Ayala Group’s Globe and China’s Ant Group has redefined the payments landscape and has expanded into allied segments such as loans, insurance, and stock market investments.
Growth momentum
Franco underlined GCash’s growing loan book of P135 billion, wealth management, and its stock trading platform.
“Based on this, GCash should have a lot of momentum heading into 2025. It’s probably doing better than any of the digital banks or even all of them put together,” Franco told InsiderPH.
“Second, no other wallet comes close. GCash’s monthly average users is 5-6 times that of Maya,” he said, referring to the fintech platform backed by PLDT Inc., KKR, and Tencent Holdings.
Secret sauce
Franco noted another significant factor contributing to GCash’s “growth spurt” is its major role as a payment facilitator for the digital gambling industry.
He estimated that GCash corners a large chunk of about P1.2 billion in daily transfers for online gambling, which generated gross gaming revenues of P22.5 billion during the first quarter of the year.
“So every day, Filipinos transferred over P1.2B and payment partners get a certain percentage of this (shouldered by the gaming companies) and GCash is the biggest and most preferred payment partner of the top E-games players like DigiPlus and Casino Plus,” he said.
What’s next?
Globe executives have declined to set a hard timeline for an IPO, saying they are making preparations so it can be push-button-ready when a decision is made.
The fintech platform is profitable as Mynt ended the first quarter of 2024 with equity earnings of P962 million. The unit accounts for 11 percent of Globe’s net income before tax versus 4 percent the previous year, the telco giant said.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
