☕️ Indonesian unicorn eFishery allegedly faked ~80% (USD595 mil) of its sales

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

13,479 high street stores closed permanently in the UK last year, marking an increase of 28% compared to 2023, according to the Centre for Retail Research. This equates to 37 closures every day. The data also revealed that over half of the 7,537 store closures happened because the retailers were going through bankruptcy or similar financial troubles. Experts have warned that 2025 could see even more closures due to rising budget costs, including increases in national insurance contributions and higher wages.

1.7% is the inflation rate for Malaysia in December 2024, as reported by the Department of Statistics Malaysia (DOSM). The index points for December stood at 133.4, compared to 131.2 in the same month the previous year. The annual inflation rate for 2024 was 1.8%, marking a two-year consecutive decline since 2022 when inflation stood at 3.3%.

The Global Fund to Fight AIDS, Tuberculosis, and Malaria will ask the private sector for USD2 bil (RM8.86 bil), nearly 50% more in donations, due to concerns over a shortfall in government contributions following the U.S. decision to exit the World Health Organization. The US has historically been the Fund’s largest donor, pledging USD6 bil in the last funding round. With President Trump’s second inauguration, his decision to exit the WHO and freeze international aid has sent shockwaves throughout the global health community. In its last funding round, the Global Fund raised USD15.7 bil for its work over three years, including USD1.3 bil from the private sector.

3. IN MALAYSIA 🇲🇾

Task force: The deceased pathologist was never bullied at work
The special task force formed and assigned to investigate the late pathologist and suicide victim in Lahad Datu, Sabah, claims that the victim was never bullied or mistreated by her department head. Despite the victim’s sister’s allegations that the suicide was induced by a medley of factors, namely: Bullying, excessive workload, and immense pressure, task force chairman Borhan Dollah instead stated that they found no evidence or support for the claims made by the late pathologist’s sister, specifically bullying.

He went on to say that the pair (Dr Tay Tien Yaa and her department head) worked professionally, citing interviews carried out with the deceased’s colleagues and subordinates. He also tacked on the fact that the suicide victim was a ‘city girl’ who had moved to a completely different culture, alone, though there was no evidence of any application to stay in West Malaysia, nor an appeal to the state health department or ministry’s human resources department.

Tay, deputy head of her department, was a pathologist at Lahad Datu Hospital, who passed on Aug 29.

Business

• Boost: The e-wallet, bank’s path to profitability
  7+ year-old e-wallet Boost is on track to turn a profit this year, with its burn rate now under RM1 mil, according to its Group CEO Sheyantha Abeykoon, though it is behind by 12 months based on its original plan. In 2024, Boost increased its gross transaction value (GTV) to RM5.6 bil (more than double the GTV in 2019 and 30% better than in 2020), bursting through expectations.

  As for its digital bank, Boost Bank (60:40 joint venture between Axiata Group Bhd’s fintech arm, Boost Holdings Bhd, and RHB Bank Bhd) is expected to breakeven within 3 to 5 years, likely meeting the stipulated period set by BNM. Thanks to its integration with the Boost e-wallet, 80% of Boost Bank’s users transitioned from the Boost app (2 mil active users) and has already secured RM700 mil in deposits in a mere 6-month span.

• Sunway Healthcare eyeing IPO
  Sunway Healthcare Group, Sunway Bhd’s healthcare arm, has started the ball rolling on its IPO having shortlisted its bankers, according to sources, which could see it valued at an enterprise value (EV)-to-EBITDA of 21-23x based on its financial year ending Dec 31, 2026 (FY2026). Based on Sunway’s annual report, the healthcare group contributed EBITDA of RM380.8 mil in FY2023, up 33% from RM285.8 mil year-on-year. Based on the EV multiple and EBITDA, this would give it an EV of nearly RM8 bil. Revenue in FY2023 increased 36.8% to RM1.46 bil from RM1.06 bil. but profit slipped 13.5% to RM181.62 mil from RM209.9 mil you.

  Learn: Enterprise value vs Equity value

  The listing of the healthcare group has to occur by Oct 2027 based on a shareholder’s agreement with GIC, the sovereign wealth fund of Singapore. GIC first bought a 16% stake in the Sunway Healthcare Group in 2021 for RM750 mil, valuing it at RM4.69 bil.

Shorts

1. Klang chemical factory explodes, releases eye-irritating and coloured smoke

   Yesterday, in the Kapar industrial area of Klang, a huge cloud of yellow-coloured smoke could be seen rising from a chemical factory. The explosion caused massive damage not only to the factory itself but also to nearby factories and injured 32 people. The explosion is believed to have been caused by stored chemicals within the factory compound, however, the Selangor Fire and Rescue Department stated that when their Hazmat team arrived on the scene, the burning material was instead recycled acid. The Hazmat team did test the air condition, finding normal readings. A tanker truck was also destroyed in the explosion, but no casualties were reported.

2. Sarawakian man goes missing after supposed trip to Bangkok
   A Sarawakian man has been reported missing after an alleged trip to Bangkok with a friend. The 30-year-old man had informed colleagues and family of his week-long trip to Thailand, however, the friend mentioned was unknown to those he told. Andy Jee Ying Kit was supposed to return to work in Singapore on Jan 15, but when his colleagues raised their concerns of his continued absence from work for two days to his family, they then realised that Andy was uncontactable, and had been missing for days. His phone was in fact disconnected. The family pleaded with the public for aid, posting a seeking ad on the Chinese platform XiaoHongShu (Red Note) for the missing man. Amongst our group of friends, we have heard of similar incidents. Stay safe if you are travelling to BKK. 

4. AROUND THE WORLD 🌎

Trump says and does:

1. Trump says he will impose 10% tariffs on Chinese imports on Feb 1

   In response to China’s role in the US’s fentanyl crisis, Trump intends to impose a 10% tariff on all imports from China to the US starting Feb 1. That’s “punishment” for China which he said is sending fentanyl to Mexico and Canada, from where it is transported to the US. Those tariffs would come on top of levies that Trump imposed on more than USD 300 bil worth of Chinese imports during his first term. Those tariffs were kept in place by President Joe Biden, who imposed additional levies on Chinese electric vehicles, solar cells, semiconductors and advanced batteries. Economists are wary that it could cause a global trade war, which would lead to inflation rebound and blunt US economic growth.

2. Trump says he’s open to Elon Musk or Larry Ellison purchasing TikTok

   Now that the US TikTok ban is in “delay” mode, words are abuzz on what Trump will do in order to continue its operation in the country. Interestingly, he said he would be open to billionaire supporter Elon Musk or Oracle Corp chairman Larry Ellison purchasing the social video app TikTok as part of a joint venture with the US government. ByteDance has publicly refused to sell TikTok. Seems like there’s a long line of potential buyers too — including Amazon.com Inc., Oracle, and a group of American investors assembled by tech entrepreneur Jesse Tinsley that included MrBeast, the internet’s most-followed and highest-earning content creator.

3. Trump pardons Ross Ulbricht, creator of dark web marketplace Silk Road

   Adding to the long list of pardons made by Trump after he took office is Ross Ulbricht, the imprisoned founder of the dark-web black market Silk Road. Ulbricht was convicted of 7 counts related to his operation of Silk Road, which facilitated the sale of illegal drugs and other illicit goods using Bitcoin during the early years of the main cryptocurrency, including distributing narcotics and engaging in a criminal enterprise. US prosecutors alleged that the site had been used to facilitate more than 1.5 mil transactions worth approximately USD213 mil, including more than USD 183 mil in drug sales. He can now thank Trump who has made him a free man after serving a life sentence in prison without parole since 2015.

Tech news

1. Tech giants announce USD500 bil AI project in the US

   A new and “largest AI infrastructure project by far in history” named The Stargate Project is now underway, with a USD500 bil funding between OpenAI, Oracle, Japan's Softbank and MGX, a tech investment arm of the United Arab Emirates government. The first USD100 bil of funding was being made available immediately, with the rest to come over four years, creating an estimated 100,000 jobs. The project is the latest in a series of large investments into data centres by the US tech industry and is in line with Trump’s desire to keep AI in the US.

2. Netflix gained nearly 19 mil subscribers, hikes prices in the US and other regions

   Netflix has apparently ended 2024 with a bang, with an increase of 19 mil subscribers, which sums up to 300 mil subscribers. However, the company said that they need to increase the subscription price a “little more” so that they can re-invest to further improve Netflix. In the final quarter of 2024, the streaming juggernaut said it logged a profit of USD1.87 bil on revenue of USD10.25 bil that grew double digits from the same period in 2023. Netflix shares jumped over 14% to top USD993 in after-market trades, valuing it around USD412 bil. Looking ahead, Netflix forecasts 2025 revenue between USD43.5 - 44.5 bil and is targeting a healthy 29% operating margin.

3. Indonesian unicorn eFishery allegedly faked most of its sales

   The preliminary ongoing probe into the Indonesian unicorn agritech startup eFishery has shed some light on some seriously distorted findings regarding its revenues, profits and losses. According to a 52-page draft report circulated among investors and reviewed by Bloomberg News, it is estimated that the management inflated revenue by almost USD 600 mil in the nine months to September 2024.

   Once an enticing prospect to investors, the company had presented a USD16 mil profit for the first nine months of 2024, but the investigation commissioned by the board alleges the firm actually generated a USD 35.4 mil loss. Revenue for the period was estimated at USD 157 mil, rather than the USD 752 mil investors were told. While eF**kery eFishery said it had more than 400,000 fish feeders in operation, initial investigations estimated it had only about 24,000.

   eFishery is valued at a staggering USD1.4 bil, and backed by esteemed investors including Japan’s SoftBank Group and Singapore’s Temasek. Thank god Khazanah backed out from the company’s Series D funding round.

Shorts

1. Ski resort hotel fire at Turkiye ski resort killed at least 76 people

   A blaze broke out overnight in the restaurant of the hotel in Kartalkaya in Bolu province, Turkiye on Tuesday, resulting in a devastating fire that killed 76 people. 45 out of 76 victims have been identified at the time of writing. Investigations into the fire have begun, and 9 people have been detained as part of the investigation, including the hotel’s owner. Kartalkaya is one of Turkiye’s premier winter tourism destinations, attracting thousands of visitors during the ski season.

2. South Korea to implement improvements at seven airports across the country after Jeju Air crash

   Following the deadly Jeju Air crash in December, South Korean authorities had announced that they will be implementing changes in seven airports around the country, particularly related to the concrete barriers or “localisers” location on the runways. The localisers are meant to help planes navigate their landings. The measures include relocating the foundations underground and replacing them with lightweight or breakable steel structures. The 7 airports include Muan and Jeju International Airport, a popular tourist hotspot and the country’s second-largest airport, after Incheon which serves the capital Seoul.

5. FOR YOUR EYES 📺

1. Most people who migrate to a new country stay within the same continent, according to the United Nations Department of Economic and Social Affairs. Six out of ten Asian emigrants remain within Asia, while European and North American emigrants show an even stronger tendency to stay in their continent, at 70% and 87%, respectively. This share is smaller in Africa and South America, at around half.

2. Throwback: Prices of cars in 1996. Cars are actually cheaper, today factoring in new and enhanced features.