ComfortDelGro Last:1.28

-0.01

COMFORT DELGRO - MOVING FORWARD

Wolf Money(portfolio update end May 2025)part 2 ComfortDelGro related

Commentary

Another month, another flip-flop by the Trump& rsquo s administration on trade policy. I have acquired some skills of keeping the noise out of my mind. I did little in May with the exception to a sale in Grab Holdings and a small loss in my test case position at Alibaba. Just before the month is up, I bought in a small position in Keppel.

https://lonewolfinvestor.blogspot.com/2025/05/wolf-moneyportfolio-update-end-may_30.html

Recent weakness could be market reacting to Grab buying Goto.

Aud keep depreciating. Won't be a good thing to invest in Oz. Look at lendlease reit and fraser l c reit. Their share prices keep dropping now .

ComfortDelGro will bid to run Melbourne trains from 2027 as part of consortium

CDG is increasing its oversea growth.
If Melbourne bid is successful, it will dominate Melbourne with Taxi, Bus and Rail. Awesome Combo....

Comfort is Accelerating the downward trend. It is. Accelerating. .

Don?t fret, Bro. Prices will catch up with valuations. No need to worry holding CDG in these period of uncertainty. Defensive domestic earnings and footprint internationalizing.

Asdfgh101 ( Date: 15-May-2025 09:48) Posted:

No wonder nobody wants to invest in SGX...this chap has posted stellar results since 18 months ago and it continues to drop...so many positives including Trump wanting to keep oil price low...short of a sale of one of their subsidiaries, it seems stuck in neutral..and both TH and DBS don't seem to want to push this unless they have grand plans to push it later back into the STI

ComfortDelGro posts a 19% rise in Q1 net profit to S$48.3 million

Revenue rises 16.4% to S$1.2 billion, whereas operating costs climbs at a slower pace of 15%

[SINGAPORE] Transport behemoth ComfortDelGro : C52 -0.65% posted a 19 per cent rise in its net profit of S$48.3 million for the quarter ended March on contributions from last year&rsquo s acquisitions and improved margins.

It said in an update for the first quarter of FY2025 published on Wednesday (May 14) that revenue rose 16.4 per cent year on year to S$1.2 billion, whereas operating costs climbed at a slower pace of 15 per cent.

The mainboard-listed company was confident that its cabbies would not jump ship to Grab. At the Apr 22 annual general meeting, the transport operator&rsquo s group chief executive Cheng Siak Kian sought to assure shareholders about the loyalty of its own taxi drivers.

Grab obtained a taxi operator licence in April.

Cheng said the award to Grab to increase the taxi fleet size in Singapore was not unexpected.

He added that ComfortDelGro cabbies would recognise the value of the company&rsquo s ecosystem, including quality of vehicles and support and fuel discounts, and stay on for quality of the drivers&rsquo support and security.

Cheng noted that the greater concern to the taxi operator is the shortage of taxi drivers, adding that there are talks with the regulators to level the playing field between the taxi and the private hire industry, and ensure sustainability of earnings for the taxi drivers.

In its update, the transport group commented that overseas contributions accounted for more than half the total revenue for the first time in its history its acquisitions in Europe and Australia drove up foreign contributions to 52.6 per cent from 43.3 per cent in the year-ago period.

Revenue from Singapore was lower, contributing 47.4 per cent, after the Jurong West bus package was handed over to a new operator late last year.

However, the local business was responsible for 60.2 per cent of the group&rsquo s operating profit, and benefited from cost control and internal efficiencies, ComfortDelGro said.

By segment, public transport earned a higher operating profit of S$36.7 million for the group, up 52.9 per cent from S$23.8 million.

ComfortDelGro&rsquo s taxi and private hire reported an 11.9 per cent rise in operating profit to S$32.1 million, while other transport swung to an operating profit of S$700,000 from an operating loss of S$1 million.

Car and non-vehicle inspection and testing services generated S$9 million in operating profit, up 8.4 per cent, while other segments reported a 150 per cent surge in operating profit to S$3 million.

https://links.sgx.com/1.0.0/corporate-announcements/ANFTACIXBMS3HZ1Y/845362_ComfortDelGro%20-%201Q2025%20Business%20Update.pdf

Wolf Money(ComfortDelGro 1Q 2025 result)

https://lonewolfinvestor.blogspot.com/2025/05/wolf-moneycomfortdelgro-1q-result.html

Wolf Money(portfolio update end April 2025)part 2 ComfortDelGro related

Commentary

April was a volatile month. Let me address my recent changes to my portfolio. I would have preferred not to touch them, but under the dark cloud of trade wars. I am forced to adopt a more defensive position. It might be worth taking insurance by lowering the beta of my portfolio. For people new to my blog, I adopt a more concentrated style of portfolio management.

https://lonewolfinvestor.blogspot.com/2025/05/wolf-moneyportfolio-update-end-april.html

Think win win.

Not just one party win.

Cooperate.

Extends to politics

Joelton ( Date: 30-Apr-2025 10:42) Posted:

Will ComfortDelGro win the point-to-point 2.0 race against Grab?

Studies show that people who choose to drive taxis are those who want to devote more time to driving for a living

[SINGAPORE] Grab&rsquo s entry into Singapore&rsquo s taxi market is likely to give the leading incumbent ComfortDelGro : C52 +0.65% a run for its money.

Studies have shown that people who choose to drive taxis are those who want to devote more time to driving for a living. Private-hire car drivers, on the other hand, are a mix of full-time drivers and part-timers who also use their cars for personal purposes.

Moreover, taxi drivers are permitted to provide ride-hailing trips, while private-hire car drivers are not allowed to take street-hail passengers.

What&rsquo s in it for the platform operator then?

An executive for one of the incumbent taxi companies said new taxi companies such as GrabCab &ndash a subsidiary of the Nasdaq-listed Grab that was awarded the taxi operator licence &ndash are likely to draw drivers from the existing operators.

For some, it is clear that Grab wants to grab taxi drivers, who are seen as more productive than private-hire vehicle drivers.

It is not the first time Grab has tried to enter the taxi market.

Grab in 2024 abandoned plans to acquire taxi company Trans-cab after failing to obtain the all-clear from the competition watchdog.

The proposed Trans-cab purchase was Grab&rsquo s third attempt at buying a taxi company in Singapore.

In 2017, there were talks to buy SMRT&rsquo s taxi fleet, but the deal fell through. In 2022, its discussion with Prime Taxi, the smallest cab operator in the Republic, did not materialise into a transaction either.

Grab gears up for recruitment

Shortly after being shown the green light to provide taxi services, Grab sprang into action to recruit taxi drivers. It dangled &ldquo early-bird&rdquo rental offers and asked applicants &ndash in what it touts as an exclusive deal &ndash to make a deposit of S$50 for priority access to renting from GrabCab.

Those without a taxi driver&rsquo s provisional licence (TDVL) will get Grab&rsquo s sponsorship for the course to earn it &ndash with terms and conditions attached.

The fund to buy Trans-cab &ndash said to be around S$100 million &ndash will now likely serve as the financial firepower to incentivise drivers to jump ship from other taxi operators or entice those with a TDVL but are inactive to rejoin the industry.

As at February, there were 90,556 holders of a TDVL compared to a taxi population of 12,941, statistics from the Land Transport Authority showed.

Assuming there is a relief driver for half of the taxi population, that would bring the pool of active taxi drivers in Singapore to about 20,000.

This means that there could be some 70,000 people that hold TDVLs but do not drive taxis. Or, as a TDVL allows a holder to drive a taxi or a private-hire car, some of these could be private-hire car drivers.

ComfortDelGro&rsquo s fleet of 8,255 taxis under the Comfort and CityCab brands means the Singapore mainboard-listed transport behemoth has about 64 per cent share of the market.

Assuming Grab wants to build an initial fleet of 800 taxis &ndash the minimum required by the authority &ndash and that the source of drivers would be from the incumbents proportionate to their market share, this could see ComfortDelGro lose about 512 drivers.

But if Grab builds a fleet size of 2,000 &ndash Trans-cab&rsquo s taxi population at the time the earlier acquisition was proposed &ndash then the number of taxi drivers exiting ComfortDelGro could rise to 1,280.

Of course, not all the drivers that Grab wants to recruit would be from the incumbents. However, the majority are likely to be. Their dwindling numbers in recent years as well as the flexibility and lower cost of being private-hire car drivers substantiate this proposition &ndash unless there is a spike in Singapore&rsquo s unemployment rate.

A back-of-the-envelope calculation, using an attrition of 512 to 1,280 drivers and a conservative daily rent of S$100, ComfortDelGro&rsquo s rental loss alone &ndash not including ancillary revenue such as those from fuel sales and platform fees &ndash would probably amount to S$18.4 million to S$46 million. This is hardly damaging.

The transport powerhouse reported S$748.7 million in revenue and S$135.3 million in operating profit from the taxi and private-hire vehicle segment for FY2024, without breaking down by geography and sub-segment.

The taxi business is ComfortDelGro&rsquo s most lucrative transport segment, giving it an operating profit margin of 18.1 per cent for FY2024. Its two other transport segments &ndash public transport and other private transport &ndash each only had a meagre operating profit margin of 4.2 per cent.

One would expect ComfortDelGro not to cede ground to Grab easily. In terms of rental rates, benefits and incentives, it is likely to match, if not outdo, its competitor to protect this source of revenue

This will be the second round of the face-off, after Grab drew taxi drivers to its platform with generous incentives in the early days of ride-hailing.

In the short term, this could mean rising costs for both operators. But there is more at stake for ComfortDelGro to defend its turf than for Grab to make inroads into the taxi market.

If ComfortDelGro is not able to keep its taxi population at a certain level, its network effect in terms of drivers and passengers will decrease and it will also lose economies of scale. By then, the impact to ComfortDelGro could be far greater than the initial hit of S$46 million.

While ComfortDelGro might be competitive in dishing out carrots, it also has to significantly rev up its technology prowess &ndash which is seen as Grab&rsquo s strength.

One would imagine that the competitor could leverage technology to tackle the imbalance in demand and supply by identifying areas or time of the day where passenger demand is high and unmet by private-hire car drivers, and deploying taxi drivers to meet such demand.

This will boost cabbies&rsquo earnings and passenger satisfaction, in turn creating a virtuous cycle.