Broker Name: CGS International Securities Singapore Pte. Ltd.
Date: October 21, 2024

Overview

SEA Ltd is a leading player in the e-commerce sector, known for its robust platform, Shopee, which has been instrumental in driving its growth across Southeast Asia.

Financial Performance

• Expected Results for 3Q24F:
  SEA Ltd is anticipated to deliver a positive set of results, with its topline likely to exceed consensus estimates. This growth is primarily driven by strong Gross Merchandise Value (GMV) growth and improved take rate expansion in the Shopee platform.

Market Position

• E-Commerce Competition:
  The competitive landscape among ASEAN e-commerce players has shown signs of rationalization. Fee adjustments have been implemented across various markets in 3Q24, reflecting a more stable environment for e-commerce operations.

Future Outlook

• Topline Growth:
  Maintaining topline growth is prioritized for the second half of FY24F. Further rationalization of competition is expected to enhance Shopee’s margins in FY25F.
• Target Price Update:
  The target price for SEA Ltd has been lifted to USD 118, indicating an optimistic outlook for its market performance.

Summary

SEA Ltd’s strategic positioning within the e-commerce market, coupled with anticipated strong financial results and a lifted target price, makes it a compelling option for investors looking to capitalize on growth opportunities in Southeast Asia.