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Mobile Gains

Let's kick off with a question that might hit close to home for many of us: How many of you have a mobile game tucked away among your apps?


A quick count around the office– 8 out of 10 people are avid mobile gamer!


Due to Covid-19 restrictions leading to a decline in traditional sports participation, the global video and internet gaming industry has exploded in popularity. In just three years, from 2019 to 2022, it tripled its value from USD 61.3 bn to a staggering USD 184.4 bn. Notably, mobile games alone account for half of this sum, with South East Asia claiming an impressive 48% of the global market share.

Indonesia's gaming market currently holds the 16th position worldwide and takes the top spot in Southeast Asia, boasting estimated sales of approximately USD 1 billion at the start of 2023. The Indonesian Gaming Association (AGI) reports claims an annual growth rate of 37% in the local gaming sector, outpacing the growth rates of other Southeast Asian nations.


As per Limelight Networks' findings, Indonesians dedicate an average of 8.54 hours per week to playing video games, slightly surpassing the global average of 8.45 hours per week. In this regard, Indonesia ranks fourth, following closely behind China, Vietnam, and India.



With an estimated 89.2% of Indonesians expected to own smartphones by 2025 and 210 million internet users recorded in January 2022, the surge in online mobile gaming is inevitable. This growth, driven by the increasing number of smartphones and internet users, solidifies its dominance in the Indonesian gaming market.


Numerous investors, both local and international, are eyeing this sector. BUKA, for instance, made its entry into the market in 2021 through itemku and has now become the majority shareholder in 2023, holding 91% ownership. Their objective is to make video games more accessible to people of all backgrounds throughout Indonesia.

Towards the end of the last year, they inaugurated the first-ever Game and NFT Convention in Indonesia. This move has yielded positive results, with itemku contributing approximately 20% of BUKA's total revenue in 1H23.


Source: Tempo

The Marketplace segment reported impressive revenue growth of Rp684 billion, marking a 32% increase qoq. The company credits Itemku's, with its high single-digit take rate, for contributing to over 50% of this growth.


With a substantial global gaming audience, game developers harness the power of big data to meticulously design subscriptions and items, strategically priced to hit the sweet spot to drive purchase intentions and willingness to pay.


Micro-transactions generate direct player revenue by cleverly balancing free core game services with premium content, enticing players to make purchases. These transactions are popular for enhancing the gaming experience through game skins, extra content, and gameplay advantages.

Source: itemku


Itemku has made the process of buying and selling accounts more organized and systematic, transforming a practice that has been around for years into a trusted platform. It also empowers users to get crafty and earn profits as a side hustle.



According to the State of Mobile 2023 Gaming Report, Indonesian mobile gamers spent approximately USD 370 million in 2022. This marked an increase of USD 50 million compared to 2021.


These expenditures correlate with a rise in mobile game downloads, which reached 3.45 billion in 2022, up by 320 million from the previous year. As for Itemku, although the company has yet to disclose its GMV, several metrics can be used as proxy to better understand its positioning in the market.


As of August, itemku had 4.7 million Play Store downloads, whereas Lapakgaming, a local competitor, struggled with less than 50k downloads. Our data also indicates that itemku maintained an average of 152,000 daily active users and 1.5 million monthly active users as of July. Although it experienced some decline, it is still align with the decrease in MAU across e-commerce platform.


Additionally, itemku also leads in web traffic with 3.8 million visits in July, with over 94% originating from Indonesia. Meanwhile, one of its major regional rivals, Unipin, follows with 3.2 million visits.

Source: Sucor Sekuritas

In summary, we see limited downside risk in BUKA's current stock price. With a market cap of Rp 24.5 trillion, ~80% of it consisting of cash and liquid investments, the actual valuation of BUKA's core business stands at Rp 4 trillion. The company is confident in achieving a positive adjusted EBITDA by 4Q23, consistently outperforming its quarterly guidance.


We reiterate our BUY recommendation with a TP of Rp. 266, based on our DCF valuation method, anticipating BUKA's positive FCFF in the foreseeable future. As always, happy to discuss our calls!



Read our full report here:




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