GoTo and Grab face pressure to offer drivers better deals; GoTo's share price has fallen 90% from its 2022 peak, while Grab's has fallen 50% in the past year

Grab's acquisition of Atome Financial for $1.49 billion could significantly increase its debt load.

Grab Holdings saw its stock price drop by 12% in September due to two main events. First, contract drivers in Vietnam organized a two-day "app boycott" to protest recent policy changes they claim significantly reduced their earnings. This labor discontent drew the attention of Vietnam's Competition Commission, which requested data from both Grab and its drivers regarding charges and earnings. Second, Grab announced a deal to acquire a 60% controlling stake in fintech firm Atome Financial for $1.49 billion in cash. Investors reacted negatively to the high acquisition price, contributing to the stock's decline. While Grab's CEO made a significant insider share purchase, bolstering the stock slightly, the market's concerns about the acquisition cost and the company's focus on financial services remain.

The driver protests in Vietnam highlight ongoing tensions between gig economy platforms and their contracted workforce regarding compensation and policy changes. Regulators' involvement suggests a growing scrutiny of these companies' operational practices and their impact on gig workers' livelihoods. This situation could set a precedent for how similar disputes are handled in other Southeast Asian markets where Grab operates.

Grab's substantial investment in Atome Financial signals a strategic push into the fintech sector, aiming to leverage AI for credit assessment and expand financial services for its user base, particularly drivers. While the company projects positive EBITDA contributions from Atome, the significant upfront cost and the fact that financial services currently operate at a loss raise investor concerns about financial strain and potential dilution of focus from core delivery and ride-hailing businesses.