Path to profitability
Migme Ltd (AX:MIG) is a global digital media company focused on the emerging markets of Indonesia, the Philippines and India. At 31 December 2015 monthly active users (MAUs) totalled 32 million (December 2014: 10 million). MIG has announced its social e-commerce strategy, which it plans to launch in H216. MIG is still seen by the market as an early-stage company and we therefore expect that until the path to profitability becomes more certain, there will be a significant gap between share price and value. We have included the A$6.99m share placement to Meitu, but have excluded from our forecasts what we think will be a positive impact on both MAU and monetisation from the Meitu MoU pending the proposed company briefing.
Runs on the board from journey to date
MIG has demonstrated that its product offering has been able to attract ~13% of its chosen marketplaces’ social network users of 246 million (social e-commerce users are expected to grow to 442 million by FY18, source: Statista.com) within an 18-month period. It has been able to monetise its offering using a freemium model, its social communities and its relationships with artists to entice users to purchase virtual gifts and premium offerings. Over the last year, MIG has grown its MAU base (220% y-o-y) at a similar rate to other large social media platforms.
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