OMH: Initiating Coverage - Positioning to Benefit From Growing Real Estate Market
By M. Marin
NASDAQ:OMH
READ THE FULL OMH RESEARCH REPORT
Expanding suite of offerings via organic product / service launches, affiliations, strategic M&A…
Singapore-based technology company Ohmyhome Ltd (NASDAQ:OMH) operates an online real estate platform that it believes provides a one-stop solution for a broad range of services for property buyers, sellers, renters and renovators. The company has facilitated 14,500+ property transactions representing an aggregate GTV (gross transaction value) of US$2.9+ billion, ranking Ohmyhome among Singapore’s leading integrated property transactions and services platforms, according to Frost & Sullivan.
The company continues to expand its suite of offerings through organic product and service launches, affiliations and strategic M&A. For example, OMH recently introduced AI-enabled HomerAI. The company also introduced HomerGPT, currently in beta testing, which is designed to provide consumers access to information, including real-time data about their properties and relevant market data. Moreover, the company’s strategy is to further penetrate and deepen its operations within the Singapore and Malaysian markets and also expand into additional Southeast Asian markets.
Acquisition expected to expand offerings, accelerate growth …
This month Ohmyhome acquired Simply Sakal tech-enabled property management company, which manages some 6,000 units in Singapore whose residents will have access to Ohmyhome. The company believes the transaction strengthens its goal to create a leading one-stop online property destination. The transaction is expected to be accretive to revenue growth and lead to positive EBITDA in 2025 pro forma for synergies.
The company expects Singapore and Malaysia’s economies and strong use of digital technology to serve as positive tailwinds. Singapore’s economy has expanded significantly over the past two decades and some 92%-95+% of the population has internet access (World Bank). GDP growth averaged more than 4.3% in Malaysia from 2016 to 2019 (IMF), and the country is also expected to enjoy strong economic growth over the next several years, fueled by population growth, urbanization and industrialization, among other factors.
Ohmyhome believes it is well-positioned to appeal to both domestic and international residents who are interested in properties in Singapore and Southeast Asia, particularly following a recent partnership with eMediaLinks, which Ohmyhome believes also enables its customers to research properties in the U.S. for potential Singapore buyers.
Reflecting the market dynamics in Singapore, including the country’s large multinational corporate community, property values have increased substantially over the past several years. The Singaporean government has enacted measures designed to constrain rising housing prices.
The company attributes a revenue decline in 1H 2023, after substantial revenue growth in 2020-22, primarily to the negative impact of the government measures noted above. Ohmyhome is optimistic that the impact will be temporary and expects to record a three-fold revenue increase in 2024 with the recent Simply transaction and reach positive EBITDA in 2025.
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