UOB KayHian started Synagie at Buy with S$0.45 target price, saying it’s one of Southeast Asia’s fastest growing e-commerce startups, and a leading e-commerce “enabler” for the beauty, body and baby care sector.
“Investors can look forward to growth propulsion as Synagie rides on Southeast Asia’s undeveloped e-commerce opportunities,” it said in a note on Monday, adding that it has quickly accumulated more than 250 brand partners.
“Synagie provides an all-encompassing value proposition for brand owners to solve their end-to-end e-commerce needs not just in content development but also in integrating warehousing, distribution and logistics,” UOB KayHian said. “This automation of sales on multiple online marketplaces in Southeast Asia, including Lazada, Qoo10, Shopee and Redmart, makes Synagie the go-to platform with a comprehensive ecosystem.”
The brokerage said it expected Synagie sales would rise “exponentially’ to S$39.3 million in 2020, with a three-year compound annual growth rate (CAGR) of 47.3 percent, adding that for estimating 2018 revenue, it assumed an average of 300 brands with a blended contribution of S$40,000 per brand.
It also noted that Synagie acquired insurance administrator 1Care, and that it could now integrate Insurtech into its platform, giving brand owners the ability to provide extended warranty and protection services for end-customers.
The Insuretech subsidiary had revenue of S$4.3 million and net profit of S$1.1 million in 2017, it noted.
The company is also asset-light on the e-logistics front, giving it an edge on driving volume without high capex, it said, pointing to its recent partnership with China UnionPay and Shanghai UnionPay to provide services for China outbound parcel delivery services to more than 50 countries for around 6.8 million Chinese small and medium enterprises (SMEs).