Grab (GRAB) could see accelerating top-line growth in 2025, driven by growing penetration and company-specific initiatives to expand its total addressable market, Morgan Stanley said in a Friday note.

The firm expects deliveries' gross merchandise value to grow by 14% and mobility GMV to rise 19%, reinforcing strong growth momentum. Deliveries' adjusted EBITDA margin is expected to expand to 2.1% from 1.7% last year, while Mobility margins are expected to remain largely stable despite reinvestments in select markets.

The firm anticipates adjusted Earnings before interest, taxes, depreciation and amortization to rise 60% year over year, surpassing management's guidance and consensus estimates, according to the note.

For Financial Services, Morgan Stanley anticipates losses to narrow to $80 million from $105 million, as Grab expands its digital bank loan books in Singapore and Malaysia.

The analysts noted that the company is in a prime position to drive the adoption of autonomous vehicles, given its leading utilization rates. The company said it is in discussions with regulators and potential partners regarding the technology, according to the note.

The firm also highlighted Grab's strong growth in Indonesia and its strategic advantage in cross-selling across its ecosystem.

Morgan Stanley reiterated the company's rating of overweight and increased the price target to $5.70 from $5.50.

(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)

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