Comfort Delgro

Haha, I guess the company is building their own ecosystem to increase barrier to entry for competitors. But do u think it is worth any higher premium for their stock?

(25-06-2015, 05:29 AM)ValueBargainer Wrote: Haha, I guess the company is building their own ecosystem to increase barrier to entry for competitors. But do u think it is worth any higher premium for their stock?

IMO, it is a counter-productive move. With the advance of technology innovation, any initiative not directly benefit the end-customer, is a move of shooting oneself in the foot.

I will value with a greater discount, rather than a premium.

(not vested)

Once the regulation maturing for GrabCar, I reckon taxi companies will feel the pain. At the mean time, no significant impact seen yet...

(not vested)

GrabTaxi could threaten transport stocks, says Maybank Kim Eng

SINGAPORE (June 30): GrabTaxi launched GrabCar, a private transport service similar to Uber over the weekend.

The rising trend of private transport services could pressurise taxi rentals for traditional players and the market could be under-estimating the threat, writes analyst Derrick Heng in a June 29 report.

GrabCar is being aggressively marketed, giving out free rides over the weekend.

According to media reports, GrabTaxi aims to have a fleet of 600 cars by end-2015 and 2,000 in the longer term.

“There are currently 20,838 rental cars in the market that new players could potentially harness. This is a credible fleet size vs the 28,792 taxis currently on the road. We believe ComfortDelGro ( Financial Dashboard) could be most affected by the competition as its taxi business accounts for 31% of its sales and 34% of earnings before interest and tax,” writes Heng.
...
http://www.theedgemarkets.com/sg/article...nk-kim-eng

A new competitor, who started off with a different yet strong perspective. Once one company in, there is a big jump in market share. The technique of "The enemy of my enemy is my friend"?  


New app offers cab firms response to Uber, GrabTaxi
28 Oct 2015 09:00
By Christopher Tan Senior Transport Correspondent

Another ride-booking app is coming to town. But instead of going head-on with taxi companies, London- and New York-based Karhoo wants to work with cab operators "to level the playing field".

Started by British entrepreneur Daniel Ishag, 41, Karhoo has been in talks with most of the taxi companies here to create a journey aggregator commuters can tap into.

"We are really excited about launching in Singapore in the first quarter of next year," he told The Straits Times via e-mail.

Karhoo's app is supposed to allow commuters to pick a cab or a private-hire car across companies, based on criteria such as cost, time of arrival and type of vehicle.
...
Source: Straits Times

The report conveniently missed a point, that diesel price is about half of average petrol price. Fuel price is a running and major cost for the service, rather than the yearly taxes.

Regulatory cost, is the extra for the company, but maintenance and insurance costs are the same for both, IMO.

(not vested)

Ride-sharing apps could lower ComfortDelgro’s taxi hire-out rate: UBS

SINGAPORE (Nov 5): UBS says ride-sharing apps such as GrabCar and Uber is expected to affect public transport operator ComfortDelgro (DGG) as the latter operates 60% of taxis plying Singapore roads which contributes to about a quarter of group revenue and operating profit.

In a Thursday report, analyst Cheryl Lee says CDG’s competitive advantage has been eroded by ride-sharing apps which offer flexible terms to prospective drivers, many of whom are seeking part-time income.

The competing business models too have significant cost differences, says Lee.

CDG incurs road and diesel tax of around $6,120/year for each taxi, or around $16.77/day. However, the road tax on a 1,599cc private car is around $2.90/day, even if it is used for Uber work.

As a responsible licensed taxi operator which is subjected to regulatory scrutiny, CDG also incurs driver benefits ($8/day), maintenance ($17/day) and insurance ($13/day), and it subsidises hirers’ diesel.

“Higher driver churn is likely as drivers now have more options. The magnitude is unclear but we estimate that a 5% erosion in the hire-out rate impacts CDG's bottom line by around $6 million annually, or around 2%,” says Lee.
...
http://www.theedgemarkets.com/sg/article...t-rate-ubs

well life is never fair.. i guess more will switch from out from being a taxi operator to uber etc... lets keep our eyes wide open !!!!!!!

http://www.theedgemarkets.com/sg/article...egulations

(06-11-2015, 11:08 AM)CityFarmer Wrote:  and it subsidises hirers’ diesel.

This part is very funny. AFAIK, selling of diesel is a profit centre for CDG wor...

Selling of diesel is very profitable because no marketing and distribution costs plus captive audience...

(06-11-2015, 12:19 PM)HitandRun Wrote:

(06-11-2015, 11:08 AM)CityFarmer Wrote:  and it subsidises hirers’ diesel.

This part is very funny. AFAIK, selling of diesel is a profit centre for CDG wor...

Selling of diesel is very profitable because no marketing and distribution costs plus captive audience...

Good point raised. Thank you.

i wonder how long can the so-called growth last, with new hires dropping in. unless gahment plans to regulate 3rd party hire companies with such the likes or uber.

http://sdb.theedgemarkets.com/2015/SMR/S...jkk1ie.pdf

Dont say no share. Broker's report on Comfort Del.
ComfortDelGro kept at 'hold' with $2.99 fair value by OCBC amid stable earnings
http://www.theedgemarkets.com/sg/article...e-earnings