KUALA LUMPUR (June 12): Shares of Synergy House Bhd (KL:SYNERGY) climbed to a new record high on Wednesday after the furniture exporter was appointed as an authorised service partner for an undisclosed US online home retailer.

Synergy rose as much as 9.94% or 16 sen to RM1.77, its highest since listing on June 1, 2023.

The counter pared some gains to settle at RM1.76, still up 15 sen or 9.317%. Trading volume totalled 2.51 million shares, above its 20-day moving average.

On Tuesday, Synergy announced that its wholly-owned subsidiary, Synergy House Global Sdn Bhd, had been engaged as the authorised service partner in Malaysia by one of the world’s largest home retailers.

"This milestone will open up a new income stream for Synergy, encompassing potential one-off onboarding services and recurring transactions," said RHB Investment Bank (RHB IB), one of only two research houses covering the stock.

Shares of Synergy have more than doubled from its initial public offering (IPO) price of 43 sen a piece. The IPO raised RM34.4 million for the company and RM21.5 million for its shareholders Tan Eu Tah and his cousin Teh Yee Luen.

The company mainly designs, develops and sells ready-to-assemble home furniture to online retailers, chain-store retailers and wholesalers as well as directly to consumers through in-house online store and third party e-commerce platforms.

Synergy House would be the first Malaysian authorised service partner for the unnamed US online home retailer, and will support local manufacturers and vendors by integrating them into the retailer's global online platform.

The company will also collaborate with the retailer to organise online and offline events aimed at onboarding new vendors and raising awareness about the retailer’s e-commerce ecosystem.

Upon successful onboarding into the retailer’s platform for the vendors, Synergy House is expected to work directly with them on select support services, including strategic advice on product selections, links to other service providers, assistance with advertisements and promotions, and troubleshooting issues.

Synergy House’s appointment as an authorised service partner is a “strategic move” that will expand its revenue stream by FY2026 with minimal capital and solidifies its global position as it transitions from “being an e-commerce vendor to an e-commerce enabler,” said RHB IB.

The research house kept its ‘buy’ call on the stock, betting that the new business model will offer the group growth opportunities beyond its current business-to-consumer and business-to-business operations.

“Growth prospects should be exponential, as it will generate recurring income streams by hosting and supporting various vendors in the future,” RHB added.