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LTA website has an interesting set of stats
https://www.lta.gov.sg/content/dam/ltago...o_2021.pdf
On the ride hailing front, there are actually a decreasing number of ppl driving (56k fall to 49k), in terms of average daily rides per day, it has stagnated.
For Taxis, their fleet too has fallen with CDG taxis experiencing the largest fall.
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14-12-2021, 11:36 PM
(This post was last modified: 14-12-2021, 11:38 PM by Wildreamz.)
(14-12-2021, 08:25 PM)CY09 Wrote: LTA website has an interesting set of stats
https://www.lta.gov.sg/content/dam/ltago...o_2021.pdf
On the ride hailing front, there are actually a decreasing number of ppl driving (56k fall to 49k), in terms of average daily rides per day, it has stagnated.
For Taxis, their fleet too has fallen with CDG taxis experiencing the largest fall.
I don't Grab much. But if I have to guess, it probably had something to do with reduced number of vouchers/subsidies recently. Evidence that ride-hailing demand is not inelastic.
Again, why bother paying up such a high multiple for Grab..?
Seems like you might be trying a little too hard to find a plausible bull case?
“If you buy a business just because it’s undervalued, then you have to worry about selling it when it reaches its intrinsic value. That’s hard. But if you can buy a few great companies, then you can sit on your ass. That’s a good thing.” - Charlie Munger
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Just trying to do a price discovery on the company, neither a bull/bear.
For me, this is a cash burning company with potential to turnaround to a few million profit if its digital wallet/banking becomes profitable. However, its ride hailing product is unlikely to turn net profit positive because it has CDG blocking it. Food and mart delivery is another issue because Lazada/Sea Group/Delivery hero are well capitalized competitors fighting with them.
So to me, the value of the company is probably at where its net equity value of balance sheet. of course, it needs a star product to fuel adoption and that's what its delivery and mobility arms are doing albeit at an alarming cash burn rate which will burn through the recent equity injection in just 3 years
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15-12-2021, 11:57 AM
(This post was last modified: 15-12-2021, 12:36 PM by Wildreamz.)
Net equity value might be a little antiquated concept to value Grab (no offense). Edit: And I think their net equity value might be negative right now.
Probably some multiple of revenue or cash flow is more appropriate. Need to view it in the lens of how much potential acquirer like SEA is willing to pay, to buy out their competitor; or say, some slower growth company is willing to pay for growth.
“If you buy a business just because it’s undervalued, then you have to worry about selling it when it reaches its intrinsic value. That’s hard. But if you can buy a few great companies, then you can sit on your ass. That’s a good thing.” - Charlie Munger
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Grab shares to surge over 80% to $12.5 by 2022 end, forecasts JP Morgan
https://www.techinasia.com/how-grab-may-...urses-2022
“If you buy a business just because it’s undervalued, then you have to worry about selling it when it reaches its intrinsic value. That’s hard. But if you can buy a few great companies, then you can sit on your ass. That’s a good thing.” - Charlie Munger
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15-12-2021, 05:15 PM
(This post was last modified: 15-12-2021, 05:25 PM by CY09.)
Nice PR writing by Techinasia and I don't think $12 is the fair value
1) We are moving to a monetary tightening cycle, capital owners are going to demand higher IRR
2) Based on the various segments, I dont think Grab will earn a billion dollar annual profit unless delivery hero/sea group/lazada/gojek goes bankrupt. It is a winner take all game in the SEA space but unlikely the incumbents will go bankrupt
3) In my view, a $100-200 million dollar profit consistently (with its banking license) is achievable, with the above companies competing with them
4) If i were forced to ascribe a valuation, it will be a 20 times P/E with 3-4% yield.
5) This gives me USD $2-4 billion valuation ($0.50-$1.00 per share value)
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Hi CY09, your latest valuation sounds like a reasonable valuation where value investors might step in. Taking into account strategic value, future growth, brand equity etc. Growth investors and/or potential acquirer might step in a little earlier (2-3x your estimate) perhaps.
“If you buy a business just because it’s undervalued, then you have to worry about selling it when it reaches its intrinsic value. That’s hard. But if you can buy a few great companies, then you can sit on your ass. That’s a good thing.” - Charlie Munger
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17-12-2021, 12:09 PM
(This post was last modified: 17-12-2021, 03:20 PM by Wildreamz.)
Shopee rolls out taxi-hailing service in Indonesia in partnership with Blue Bird
https://kr-asia.com/shopee-rolls-out-tax...-blue-bird
Quote:Shopee Indonesia is introducing a new feature, Taksi, in partnership with the country’s leading taxi operator, Blue Bird. Taksi allows users to book a Blue Bird ride through the Shopee app and settle the fare with ShopeePay. The new function doesn’t have a dedicated page yet, and it is available in limited areas for now. Shopee is currently offering several discounts and promotions for the service.
Could post it in SEA thread as well. But I feel this is a bigger threat to Grab than it is an opportunity to SEA. TBH.
(not vested in both)
“If you buy a business just because it’s undervalued, then you have to worry about selling it when it reaches its intrinsic value. That’s hard. But if you can buy a few great companies, then you can sit on your ass. That’s a good thing.” - Charlie Munger
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By the way, old news:
Lazada, ComfortDelGro tie up to offer taxi booking within shopping app
https://www.techinasia.com/lazada-comfor...opping-app
https://www.lazada.sg/shop/comfortdelgro/
It's obvious, with low/no moat, there will always be competition, right?
“If you buy a business just because it’s undervalued, then you have to worry about selling it when it reaches its intrinsic value. That’s hard. But if you can buy a few great companies, then you can sit on your ass. That’s a good thing.” - Charlie Munger
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17-12-2021, 03:14 PM
(This post was last modified: 17-12-2021, 09:08 PM by CY09.)
Grab has two ride options in its app "Justgrab" and "Standard Taxi". CDG has an app that has the options of "Comfortride" and "Taxi by meter"
The latter for each app are cheaper option and I notice they are priced about the same since it goes by meter.
Grab's "Justgrab" is priced about 10-20% more than the latter options. What is perplexing to me is why for Comfortride, CDG pricing is way higher than "Justgrab". This is because comfort has a fleet of taxis where its drivers are already paying rental to it for owning the taxi. I don't get it why CDG want to get more commission from consumers. If this "Comfortride" is priced the same as "Justgrab", there will be much higher demand for its ride hailing app. After all, CDG has already stood up an app and can reap scale by lowering the price, otherwise not much people will use "Comfortride" and CDG has to absorb the fixed cost of running it.
To me, comfortdelgro taxi management is quite a stupid bunch to not realize this point. This is why Grab is outmaneuvering them in the Singapore market. The management of Grab is seemingly better in this aspect and why CDG is uncompetitive and losing on the taxi front. CDG has the app (technology), infrastructure and fleet. It is not using this to its full advantage and is likely losing revenue and incurring fixed cost as a result. CDG is lucky it has government contracts in public transportation which has become the main profit generator (not vicom); this has probably made the management rest on its laurels because it knows the government contract will save them.
<Not vested in any of them but just looking at how badly one company is run and a start up is fortunate to capitalize on the former mistakes to save its own skin>
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