I was actually intending to post this early yesterday morning but life (and work) got in the way. Then of course we saw a very interesting announcement yesterday which demonstrated to me that IOU management are thinking outside the box when it comes to accessing the vast population of SEA.
Anyway, here’s quick reminder of some of the milestones we have to look forward to in the coming months and quarters. I thought the handwringing about our recent SP bounces might be tempered if we remind ourselves of the exciting developments we have in the headlights. PS: this is all from company sources, aside from a few bits in (bracketed italics) where I have added a thought or two of my own.
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These are the key milestones for CY Q2 (April to June 2021):
- Comprehensive digital marketing campaign supported by online and in-field Merchant services team in May - Official BNPL launch in Malaysia - BNPL website launched (delayed from CY Q1, per March presentation) - Preparation for SEA Territory expansion, with SEA Territory 2 (Indonesia?) launching in Q3 - Development of IOU rewards system (evidently intended to drive repeat use of the app for redeemable points/awards etc) - Consumer referral program (some sort of reward for getting friends/family to sign up and use myIOU?)
As outlined the March presentation, these are all items to be achieved by end of CY Q2 – which is end of June… which is… next month! In the recently quarterly update the following was noted under 'Outlook': "The Company is well positioned to achieve its key June Quarter Roadmap deliverables as set out in the March Investor Presentation including further SEA territory expansion activities... [etc]".
Behind the scenes, I’m personally hoping for some Prepaid Inventory action given the capital allocated towards this as of December 2020 ($1,500,000) to flesh out the numbers a bit. However the recent 4C taught me leave any projections in this space to the company to deliver in concrete in due course; their focus is evidently on the BNPL space and all of the recent announcements have clearly tended that way. Fine by me - they are the market experts.
Back to the roadmap, as for CY Q3 (July to September 2021) we have the following to look forward to:
- Official launch of IOU Rewards Malaysia - Expansion into SEA Territory 2 (Indonesia? Population: 275 million) - Acquisition of (lending?) license for SEA Territories 2 and 3 (I presume given CCO Eddie Lee’s past position of President of iPay88 in the Philippines that SEA T3 will likely be there? Population: 110 million) - And the rather enigmatic “SEA Bank Acquirer + e-KYC (T2 and T3)". I'm still working this one out – thoughts from others are welcome.
Finally in CY Q4 (October to December 2021) we’ll be expanding into SEA Territory 3. As noted above I think this might be the Philippines. However our recently-signed CMO Calvin Yeap “led iPay88 to be a household name in Malaysia and successfully launched the company in Cambodia, Thailand and Bangladesh”. Take note of the countries mentioned and read between the lines there, if you wish.
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In summary, if you’re still questioning your investment in IOU, try and project forwards to the end of this year (which will be here before we know it), with BNPL officially launched and operational in three major population territories, as well as our core Digital Payments business continuing to grow (note: monthly transaction levels up 33% to 24 million per month in the March quarter, per the 4C). Then in 2022, presuming all is running smoothly in T1: Malaysia, T2: Indonesia (?) and T3: Philippines (?) we can perhaps start thinking of where the footprint might expand next…. Cambodia? Thailand? Bangladesh? Thinking about iPay88 and their majority owners NTT Corp, what about… Japan?
A truly long-term view from this holder/accumulator, and I don’t mean 6-9 months.
All my own opinions and research. Always do your own; ignore crazy ‘Mr Market’ and focus on the company fundamentals. Don’t worry about the share price, worry about what the business is actually doing; the sharemarket will eventually catch on, and catch up.
Maybe I’m wrong, but I really hope in 5-10 years’ time I’ll look back at the time and research I put into this company at this stage of its life, and be glad for every hour I spent in it. Hopefully the same is true for all.
(20min delay)