A banking company used by OnTheMarket has issued a note to its investor clients claiming the portal “arguably beats its peers in terms of leads generation, cost-efficiency and marketing yield.”
Zeus Capital describes itself as an “independent investment banking boutique” and has been used by OTM as its so-called ‘nominated adviser’; it helped the portal’s parent company prepare for floating on the London Stock Exchange.
Zeus has also been commissioned for similar work with Purplebricks.
Now it has issued a statement saying that this week’s announcement that OTM has agreed a listings deal with Barrett Developments - Britain’s largest housebuilder, with four separate brands - is merely the start of things to come.
Zeus says OTM “continues to build the contracted agent customer and shareholder base and in addition is now building a network of property developers.”
It says that property portals provide strong marketing results for what it calls “the fragmented property development market” and claims house builders enjoy a “pricing uplift” as a result of such low cost marketing.
“The slow property market makes property portals an extremely useful marketing solution for property developers” it continues, pledging that “the Barratt Developments agreement will inevitably be followed by agreements with other leading developers and smaller developers.”
It then goes on too describe the valuation of OTM, saying: “The equity value of a UK property portal, which arguably beats its peers in terms of leads generation, cost-efficiency and marketing yield, can be measured in terms of price to revenue or value per office or advertiser. In our view, after break even, OTM should trade on over £10k per advertiser.”
However, the Zeus statement makes references to the announcement on Barratt Developments not including any update from OTM management on trading performance.