One-glance verdict
Undervalued
$11.02 our estimate vs market $3.42
Wall Street consensus: $5.86 (-46.8% lower than our fair-value estimate)
69% below our estimate, below the bear case
Fundamentals snapshot
Grab Holdings Limited
GRAB · NMS · Technology · Software - Application
Current price
$3.42
52-week range
$3.18 - $6.62
Market cap
$13.99B
Balance sheet
Healthy
3.13x Stretched
Net cash $4.50B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Revenue grew 20.5% last year.
- Reward Free cash flow was positive in 1/10 years.
- Reward Trades at 31.1x P/E vs peer median 43.3x (28.2% cheaper).
What this company does
Grab Holdings Limited
Grab operates a popular 'superapp' in Southeast Asia, offering services from ride-hailing and food delivery to digital payments all in one place. The company makes money by taking a small fee from each transaction, whether it's a car ride, a meal delivery, or a digital loan. This strategy aims to create a powerful ecosystem (a network of connected services that encourage users to stay on its app), making Grab the go-to choice for many daily needs in the region.
How the company got here
Grab started in 2012 as 'MyTeksi' in Malaysia, created by two Harvard Business School graduates to make taxi rides safer. It began as a simple app to book taxis reliably, but quickly grew by expanding to other Southeast Asian countries. A major turning point was in 2018, when it acquired the Southeast Asian operations of its biggest competitor, Uber, making it the dominant ride-hailing service in the region. The company then expanded into a 'superapp,' adding food delivery, digital payments, and other services to become a part of daily life for millions. In 2021, Grab became a publicly traded company on the Nasdaq stock exchange.
What it actually does
Grab is best known as a 'superapp' for everyday needs in Southeast Asia, operating in over 800 cities. Think of it as a single smartphone app that combines the services of Uber, DoorDash, and PayPal. Through the app, you can book a car or motorcycle ride, order food from a restaurant, get groceries delivered from a store, or send a package. It also offers financial services, allowing users to make digital payments, get loans, and even buy insurance. The company connects millions of customers with a network of drivers and merchants every day.
Deliveries
This is Grab's largest business, making up more than half of its revenue. It includes services like GrabFood for restaurant meals and GrabMart for groceries and other daily essentials. The company makes money by charging restaurants and stores a commission (a percentage of the order value, typically 15-25%) for sales made through its app. Customers also pay a delivery fee for the convenience of having items brought to their doorstep.
Mobility
This was Grab's original and most profitable business, and it still accounts for over a third of the company's revenue. It's the ride-hailing part of the app, where users can book various types of rides, including private cars (GrabCar), taxis (GrabTaxi), and motorcycles (GrabBike). Grab makes money by taking a commission (a percentage of the fare, usually between 10-20%) from the driver for each ride booked through the platform. This part of the business is valuable because it brings many users to the app who then might use Grab's other services.
Financial Services
This is Grab's newest and fastest-growing segment, though it's still a smaller slice of the company's total revenue. It includes a digital wallet (GrabPay) for online and in-store payments, lending services for consumers and small businesses, and insurance products. The company earns money here in several ways: charging transaction fees to merchants for processing payments, earning interest on the loans it provides, and receiving fees for insurance policies sold. Grab is also expanding into digital banking to offer more traditional financial products.
What management is betting on now
Management is focused on making the entire business consistently profitable and leveraging technology to become more efficient. A key priority is growing its financial services, with the goal of making this segment profitable by offering more lending and investment products. The company is also investing heavily in Artificial Intelligence (AI) to improve everything from dispatching drivers more efficiently to personalizing offers for customers in the app. Finally, Grab continues to look for strategic acquisitions, like its purchase of the investing platform Stash, to add new capabilities to its superapp.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $11.02 vs current price $3.42
Wall Street consensus is the average analyst price target: $5.86 (-46.8% lower than our fair-value estimate).
Our most-likely fair value is $11.02 a share — about 222.2% above today's price of $3.42, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $4.5B - more cash than debt. Interest coverage 3.1x.
Net debt
$-4.50B
Interest coverage
3.13x
Grab Holdings Limited's profit covers its interest bill about 3.1 times over. and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
GRAB
BASELINE
Grab Holdings Limited
Total debt $2.03B Interest coverage 3.13x This is the baseline the peer rows are being compared against.
Total debt $14.73B Interest coverage 12.65x +304% vs GRAB Carries about 4.0x more debt cushion than GRAB.
Total debt $3.30B Interest coverage 362.50x +11,493% vs GRAB Carries about 115.9x more debt cushion than GRAB.
Total debt $4.13B Interest coverage 59.07x +1,789% vs GRAB Carries about 18.9x more debt cushion than GRAB.
Total debt $13.21B Interest coverage 20.01x +540% vs GRAB Carries about 6.4x more debt cushion than GRAB.
Total debt $1.29B Interest coverage -9.08x -100% vs GRAB This peer has almost no interest-payment cushion compared with GRAB.
What you should know
The case for and against GRAB
3 Rewards
0 Risks
Rewards
-
Revenue grew 20.5% last year.
-
Free cash flow was positive in 1/10 years.
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Trades at 31.1x P/E vs peer median 43.3x (28.2% cheaper).
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
31.09x
Forward P/E
24.60x
P/B
2.06x
P/S
3.75x
EV/EBITDA
28.83x
PEG ratio
0.74x
Profitability
How much profit each dollar creates
Gross margin
40.5%
Operating margin
2.1%
Net margin
16.0%
ROE
7.7%
ROA
0.7%
Health
Liquidity and balance-sheet strength
Debt / equity
0.28x
Current ratio
1.52x
Quick ratio
1.23x
Total debt
$2.03B
Total cash
$6.53B
Growth
How the business has been compounding
Revenue TTM
$3.73B
Revenue 5Y CAGR
33.0%
EPS TTM
0.11
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$79.00M
Free CF TTM
$-44.00M
FCF margin
-1.2%
Dividend
Shareholder payout
Yield
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Payout ratio
0.0%
Last ex-div date
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