ComfortDelGro - RHB Invest 2024-06-20: Operational Improvement In Singapore Continues

• ComfortDelGro's share price has declined by ~10% from its April peak of S$1.50. We believe much of this was driven by ComfortDelGro’s seasonally soft 1Q24 results and the market's expectation of below-street estimate earnings for the rest of 2024.
• - Read this at SGinvestors.io -

What is driving our expectations of a stronger earnings outlook for ComfortDelgro in the rest of 2024?

i) Public Transport segment:

• Margin recovery in UK bus operations amidst continuing service fee indexation benefits.
• - Read this at SGinvestors.io -
• Moderation in operating costs for Singapore’s public transport operations towards the end of 2024 as existing electricity contracts are re-contracted at lower rates.

ii) Taxi & Private Hire segment:

• Y-o-y higher earnings for Singapore taxi operations amidst higher fare and commission rates.
• Improvements in Chinese taxi business as the business gradually returns to pre-COVID-19 levels.
• Earnings contribution from A2B Australia, which facilitates taxi bookings and payment processing fees for non-cash taxi payments. The acquisition of A2B was completed in Apr 2024.

iii) Other Private Transport segment:

• Read more at SGinvestors.io.

Shekhar Jaiswal RHB Securities Research | https://www.rhbgroup.com/ 2024-06-20 SGinvestors.io

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