Tuya: Improving Sales Growth and Profit Margins Help to Clinch Investment by 65 Equity Partners

• On 18 November, it was announced that 65 Equity Partners (backed by Temasek) will invest US$100 million (S$134 million) for a 13% stake in Tuya Inc (TUYA US).

• Net cash as a percentage of market cap is currently at 92%. Tuya's sales growth and improvement in operating margin in 1Q-3Q 2024 have also been impressive this year.

• Comps are trading at average EV/EBITDA of 13.7x in 2025 versus 2.3x for for Tuya. If Tuya continues its turnaround, its valuation gap versus its peers could decrease further.

On 18 November, it was announced that 65 Equity Partners (backed by Temasek) will invest US$100 million (S$134 million) for a 13% stake in Tuya Inc (TUYA US). This would value a 100% value in Tuya at US$769 million. Tuya currently has a market cap of US$879 million. 65 Equity Partners is purchasing this stake from New Enterprise Associates venture capital firm.

Tan Chong Lee (CEO of 65 Equity Partners) mentioned that one of the reasons for this investment is to support high quality businesses seeking a listing on the Singapore Exchange (SGX). 65 Equity Partners could also improve liquidity for Tuya on the SGX, including by selling some of its shares back into the market.

Photo by Mike Enerio on Unsplash