OMH: Takeaways From Simply Sakal Acquisition

    Date:

    By M. Marin

    NASDAQ:OMH

    READ THE FULL OMH RESEARCH REPORT

    Simply acquisition expected to expand reach in high-value private residential sector…

    Singapore-based technology company Ohmyhome Ltd’s (NASDAQ:OMH) strategy to expand services, boost market share and enter new markets includes the recent acquisition of Simply Sakal, which OMH believes strengthens its market position and accelerates growth, particularly as Simply expands OMH’s access to Singapore’s private residential segment where revenue / transaction is higher and adds a less seasonal, recurring revenue stream.

    … and accelerate growth, particularly as Simply expands units under management

    We view it positively that the Simply acquisition diversifies Ohmyhome’s revenue base, adding a less seasonal, recurring revenue stream, particularly as Simply expands OMH’s access to Singapore’s private residential segment where revenue per transaction is higher. According to OMH filings, Simply reported operating revenues of S$2.6 million (US$2.0 million) in 2022, up 58% from S$1.7 million in 2021. Much of this growth reflects the increase in number of residential units Simply managed over this period. Simply managed some 4,648 units at the end of 2022, according to the company’s filings, up from 2,962 at the end of 2021. Simply managed 5,839 residential units as of June 30, 2023, up about 26% compared to year-end 2022. In the first six months of 2023, Simply registered operating revenue growth of about 23% year-over-year. The goal is to continue to increase the number of units under management, which Ohmyhome believes will contribute to growing Simply revenue.

    The goal to increase units under Simply management likely has a positive tailwind from actions by the Singapore government. According to Singapore’s Urban Redevelopment Authority (URA), the government has taken measures to increase the country’s housing stock.

    The company operates an online real estate platform that now also offers property management tools. Ohmyhome believes it provides a one-stop solution for a broad range of services for property buyers, sellers, renters and renovators.

    Cross-promotional agreement with Webuy Global is another recent growth initiative

    Another recent growth initiative is OMH’s cross-promotional agreement with Webuy Global to integrate its services into Webuy communities, including to support Webuy’s expansion plans. Webuy Global is an emerging e-commerce retailer focused on grocery and travel in Southeast Asia. Earlier this month, the two companies unveiled a strategic collaboration to cross-sell their respective products and services across Singapore. The integration of Ohmyhome’s services into Webuy communities is expected to facilitate off-market listings and offer exclusive benefits to Webuy customers. In addition, Webuy aims to open 100 stores in major communities in Singapore, according to the company, and Ohmyhome brokerage services are expected to facilitate this targeted expansion.

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