ComfortDelGro    Last:1.28    -0.01

ComfortDelGro fundamentally strong but price weak

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seba240698      ( Date: 08-Dec-2017 20:54) Posted: Don' t forget accident repair, CDG will be LCR authorised workshop for accident repair, plus VICOM inspections, if I say Huat maybe a bit exaggerating, but it is definitely a steal for CDG and moving forward, with synergy and experience from its workshops technicians, CDG profit will go up. And the bonus is, the report says this $295 mil will be taken from internal funds, and will not affect EPS, so dividends confirmed not cut! To shareholders of CDG, how can this be a bad news? Stanton      ( Date: 08-Dec-2017 20:48) Posted: $295M is 10% discount to NAV, this will be repaid over the life of the car. Leasing profit should conservatively be around 8.5% of ROIC which bings it to $25M pa for CDG's 51% stake. Assuming a conservative $1k pa for maintenance and repair profit for 12,450 cars will translate to $12.45M This gives a total GP of 37.45M. CDG can garner significant cost savings by combining their team with LCR. CDG is more experienced than LCR in fleet management. How can this be bad new

 

Don' t forget accident repair, CDG will be LCR authorised workshop for accident repair, plus VICOM inspections, if I say Huat maybe a bit exaggerating, but it is definitely a steal for CDG and moving forward, with synergy and experience from its workshops technicians, CDG profit will go up.

And the bonus is, the report says this $295 mil will be taken from internal funds, and will not affect EPS, so dividends confirmed not cut!

To shareholders of CDG, how can this be a bad news?

Stanton      ( Date: 08-Dec-2017 20:48) Posted: $295M is 10% discount to NAV, this will be repaid over the life of the car. Leasing profit should conservatively be around 8.5% of ROIC which bings it to $25M pa for CDG's 51% stake. Assuming a conservative $1k pa for maintenance and repair profit for 12,450 cars will translate to $12.45M This gives a total GP of 37.45M. CDG can garner significant cost savings by combining their team with LCR. CDG is more experienced than LCR in fleet management. How can this be bad new? halleluyah      ( Date: 08-Dec-2017 20:01) Posted: Yup, I think its not well spent...problem is still there....may b might get into deeper shit..

 

Think comfort need around 7400 cars .to replace sonata....prius just nice....

Stanton      ( Date: 08-Dec-2017 20:48) Posted: $295M is 10% discount to NAV, this will be repaid over the life of the car. Leasing profit should conservatively be around 8.5% of ROIC which bings it to $25M pa for CDG's 51% stake. Assuming a conservative $1k pa for maintenance and repair profit for 12,450 cars will translate to $12.45M This gives a total GP of 37.45M. CDG can garner significant cost savings by combining their team with LCR. CDG is more experienced than LCR in fleet management. How can this be bad new? halleluyah      ( Date: 08-Dec-2017 20:01) Posted: Yup, I think its not well spent...problem is still there....may b might get into deeper shit..

 

$295M is 10% discount to NAV, this will be repaid over the life of the car. Leasing profit should conservatively be around 8.5% of ROIC which bings it to $25M pa for CDG's 51% stake.

Assuming a conservative $1k pa for maintenance and repair profit for 12,450 cars will translate to $12.45M

This gives a total GP of 37.45M. CDG can garner significant cost savings by combining their team with LCR. CDG is more experienced than LCR in fleet management. How can this be bad new?

halleluyah      ( Date: 08-Dec-2017 20:01) Posted: Yup, I think its not well spent...problem is still there....may b might get into deeper shit... destinykraze      ( Date: 08-Dec-2017 19:39) Posted: Investor only look at potential growth. Does the $295million spent Increase net profit? No. LCR is a loss making coy. Synergy? Remains to be seen. Might work out. I think the main purpose is to reduce competition and regain market share grip. Are these things worth $295m?  It might be. To me, it is more like a bad - neutral news

 

Rent out more worth it..

anonymoustrader      ( Date: 08-Dec-2017 20:40) Posted: At most you can see this as a one time gain,but is a one time gain (if using ur 100k worth reasoning) gonna save the firm? edwinjup      ( Date: 08-Dec-2017 20:35) Posted: Second hand 1 yr plus toyota prius is selling above 100k..

 

At most you can see this as a one time gain,but is a one time gain (if using ur 100k worth reasoning) gonna save the firm?

edwinjup      ( Date: 08-Dec-2017 20:35) Posted: Second hand 1 yr plus toyota prius is selling above 100k... Sunstar      ( Date: 08-Dec-2017 20:25) Posted: Comfort is adding another 12.4k to its fleet of 15k taxis. Comfort is only paying 47k or based on 51%, 23k per car. And they clearly said they will pay more when utilisation rate increases. So clearly Comfort has done its sum. Be clear that Comfort is not investing into uber loss making business of subsidising it?s Drivers. Comfort is just leasing out the vehicles and servicing/repairing which uber has no economy of scale. Comfort Drivers can also now take advantage of uber car booking app, and will stem the tide of Drivers leaving the company to become private hirers. Now Comfort Drivers can have best of both worlds by using its existing telephone call booking/ app and also uber app. If I am a Comfort driver now, I see no reason to quit Comfort. In fact recently, before Comfort tie up with uber, it didn?t stop its Drivers from using grab app. Comfort clearly knows if it prevents its Drivers, they will jump ship. So now there?s a clear formalised alliance with uber. In short, Comfort is not buying into a loss making lion city, it is buying over its fleet of vehicles at below nav and will pay more when utilisation rate increase. Lion city moving forward may not be loss making anymore because it?s repairs servicing will be done by Comfort engineering arm. Comfort engineering arm will have another revenue stream.

 

Second hand 1 yr plus toyota prius is selling above 100k...

Sunstar      ( Date: 08-Dec-2017 20:25) Posted: Comfort is adding another 12.4k to its fleet of 15k taxis. Comfort is only paying 47k or based on 51%, 23k per car. And they clearly said they will pay more when utilisation rate increases. So clearly Comfort has done its sum. Be clear that Comfort is not investing into uber loss making business of subsidising it?s Drivers. Comfort is just leasing out the vehicles and servicing/repairing which uber has no economy of scale. Comfort Drivers can also now take advantage of uber car booking app, and will stem the tide of Drivers leaving the company to become private hirers. Now Comfort Drivers can have best of both worlds by using its existing telephone call booking/ app and also uber app. If I am a Comfort driver now, I see no reason to quit Comfort. In fact recently, before Comfort tie up with uber, it didn?t stop its Drivers from using grab app. Comfort clearly knows if it prevents its Drivers, they will jump ship. So now there?s a clear formalised alliance with uber. In short, Comfort is not buying into a loss making lion city, it is buying over its fleet of vehicles at below nav and will pay more when utilisation rate increase. Lion city moving forward may not be loss making anymore because it?s repairs servicing will be done by Comfort engineering arm. Comfort engineering arm will have another revenue stream.

 

the share price has been dropping because of concern over comfort Drivers may continue to leave the company. No reason to leave now. And besides, Comfort is not 100% Taxi business, it has downtown line, buses which is highly profitable and in its last financial reporting, it says it expects ridership to increase. To lose $500m market value is due to uber/ grab competition is clearly oversold

 

There are many options but it seems confort choose the worst but most safe one. Sigh....I am not expecting to see any changes to help the current situation .

 

Comfort is adding another 12.4k to its fleet of 15k taxis. Comfort is only paying 47k or based on 51%, 23k per car. And they clearly said they will pay more when utilisation rate increases. So clearly Comfort has done its sum. Be clear that Comfort is not investing into uber loss making business of subsidising it?s Drivers. Comfort is just leasing out the vehicles and servicing/repairing which uber has no economy of scale. Comfort Drivers can also now take advantage of uber car booking app, and will stem the tide of Drivers leaving the company to become private hirers. Now Comfort Drivers can have best of both worlds by using its existing telephone call booking/ app and also uber app. If I am a Comfort driver now, I see no reason to quit Comfort. In fact recently, before Comfort tie up with uber, it didn?t stop its Drivers from using grab app. Comfort clearly knows if it prevents its Drivers, they will jump ship. So now there?s a clear formalised alliance with uber. In short, Comfort is not buying into a loss making lion city, it is buying over its fleet of vehicles at below nav and will pay more when utilisation rate increase. Lion city moving forward may not be loss making anymore because it?s repairs servicing will be done by Comfort engineering arm. Comfort engineering arm will have another revenue stream.

 

1-2 yrs.old.toyota prius at 47k. Coe included Anyone interest to buy....expensive?..

Stanton      ( Date: 08-Dec-2017 18:25) Posted: This is a fantastic deal doe CDG. They are experienced in fleet management and the price of $295m works out to $47k per vehicle which is cheap. CDG get to benefit from leasing revenue and servicing. If Uber wants to reduce rental then Uber can subsidise all they want. CDG won't be so silly to burn cash to help uber. The availability of uber app for taxis will bring great relief to taxi drivers and they will benefit from increase customer demand. So taxi drivers have little reason to jump ship. Alternatively they can always switch to be uber driver. Overall, I see CDG coming back in the game with this tie up.

 

$295m is enough for Grab to give 59m $5 promo code.

pool100      ( Date: 08-Dec-2017 19:58) Posted: If they had a tie up with uber without spending much, then I think it' s a good deal.  But to spend $295m to buy more taxis when they already have so many idling, it' s just crazy and waste of money.  Expect to see sell on news after initial euphoria dies down. It' s a bad-neutral deal.

 

Yup, I think its not well spent...problem is still there....may b might get into deeper shit...

destinykraze      ( Date: 08-Dec-2017 19:39) Posted: Investor only look at potential growth. Does the $295million spent Increase net profit? No. LCR is a loss making coy. Synergy? Remains to be seen. Might work out. I think the main purpose is to reduce competition and regain market share grip. Are these things worth $295m?  It might be. To me, it is more like a bad - neutral news. Stanton      ( Date: 08-Dec-2017 19:23) Posted: Valuation of $642m is based on nav of 12,450 vehicles. For a 51% stake, CDG pays only $295m which works out to 10% discount to nav, which is very cheap for a controlling stake. CDG also get upside from recurring leasing revenue from the 12,450 rented vehicles. As majority shareholder they can also direct the 12,459 vehicles for repair and maintenance to their engineering arm. I consider this a steal for CDG.

 

If they had a tie up with uber without spending much, then I think it' s a good deal. 

But to spend $295m to buy more taxis when they already have so many idling, it' s just crazy and waste of money. 

Expect to see sell on news after initial euphoria dies down. It' s a bad-neutral deal. 

 

Investor only look at potential growth.
Does the $295million spent
Increase net profit? No. LCR is a loss making coy.
Synergy? Remains to be seen. Might work out.

I think the main purpose is to reduce competition and regain market share grip. Are these things worth $295m?  It might be. To me, it is more like a bad - neutral news.

Stanton      ( Date: 08-Dec-2017 19:23) Posted: Valuation of $642m is based on nav of 12,450 vehicles. For a 51% stake, CDG pays only $295m which works out to 10% discount to nav, which is very cheap for a controlling stake. CDG also get upside from recurring leasing revenue from the 12,450 rented vehicles. As majority shareholder they can also direct the 12,459 vehicles for repair and maintenance to their engineering arm. I consider this a steal for CDG. Starship      ( Date: 08-Dec-2017 18:36) Posted: Valued at $642m but cash consideration is $295m. So what happens to the remaing $347m ? Disappear into thin air?  Quote: In a statement, ComfortDelGro said the deal, which is subject to regulatory approval, is valued at about $642 million, with a cash consideration of $295 million. Unquote

 

Valuation of $642m is based on nav of 12,450 vehicles. For a 51% stake, CDG pays only $295m which works out to 10% discount to nav, which is very cheap for a controlling stake. CDG also get upside from recurring leasing revenue from the 12,450 rented vehicles. As majority shareholder they can also direct the 12,459 vehicles for repair and maintenance to their engineering arm. I consider this a steal for CDG.

Starship      ( Date: 08-Dec-2017 18:36) Posted: Valued at $642m but cash consideration is $295m. So what happens to the remaing $347m ? Disappear into thin air?  Quote: In a statement, ComfortDelGro said the deal, which is subject to regulatory approval, is valued at about $642 million, with a cash consideration of $295 million. Unquote

 

This is definitely not good news, hence the selldown. I don' t know why some people consider this as good. Have they done any analysis?

pool100      ( Date: 08-Dec-2017 18:51) Posted: Exactly my thoughts. They just added more taxis to their idling fleet. And paid a huge chunk from their war chest. It could hit their bottom line going forward given that LCR and uber are loss making. investshare      ( Date: 08-Dec-2017 18:37) Posted: They already idling taxi, buy more?

 

I make my decisions  based on my own analysis. I do my due deligence and then proceed. I actually think 1.90 - 1.91 is fantastic. Comfort is  oversold in my opinion. Cheers. Good Luck.

destinykraze      ( Date: 08-Dec-2017 17:08) Posted: bank analyst thinks comfort is great to enter now. lol. just because idling fleet isnt increasing anymore. but they completely omitted details like comfort slashing the rental to abyssal rates. the situation is a long term 1. analyst always tries to induce people to buy after they have entered. wait for bottom to form before entering! sun233      ( Date: 08-Dec-2017 16:35) Posted: i totally agree with you regarding their business. I just vested.  Happy with price. Short term noise not a concern for me. Grab making some headway but this is bc Comfort has been too complacent. Earlier there were so many complains of taxis hiding during peak hour but things have changed now. Every month there was some complain about taxis so the govt allowed Grab to start. This complacency is what is bothering me. Comfort has lost their comfort zone. They have to work harder now but with the current team looks like it wont happen. They need to up their game

 

Exactly my thoughts.

They just added more taxis to their idling fleet. And paid a huge chunk from their war chest.

It could hit their bottom line going forward given that LCR and uber are loss making.

investshare      ( Date: 08-Dec-2017 18:37) Posted: They already idling taxi, buy more?

 

Wah i just bought at 1.93 yest liao.. hehehe