- The 2025 Fare Review Exercise (FRE) is mildly positive for ComfortDelGro through its 74.4%-owned SBS Transit (SGX:S61), though the earnings uplift would be modest as fare gains could be partly offset by cost pressures and lower bus earnings following the Tampines package loss from 2H26.
Fare adjustment effective 27 Dec 2025
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- Adult card fares will rise by 9-10 cents/trip, while short concession trips (≤ 3.2 km) remain unchanged and longer ones increase by 3-4 cents. Express bus fares will see a higher premium, up 40 cents for adults and 20 cents for concessionary riders. To offset the impact, monthly passes for adults, seniors, workfare recipients, and persons with disabilities will be discounted by up to 5%, and S$60 Public Transport Vouchers will continue for lower-income households.
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Earnings impact.
- The 2025 FRE is mildly positive for SBS Transit, but is unlikely to materially lift earnings. The 5.0% fare adjustment is expected to yield an additional S$17.6m in annual rail revenue for SBSTR, with 20% (S$3.5m) contributed to the Public Transport Fund, resulting in a net increase of about S$14.1m. This offers limited relief against ongoing manpower and maintenance cost pressures, which SBSTR had cited in its request for the maximum 14.4% increase.
- SBSTR reported only a marginal profit in FY24 supported by government aid. With ridership still hovering around pre-COVID-19 levels, earnings upside is likely capped.
- On a post-tax basis, the incremental profit is estimated at S$11.6m, of which ComfortDelGro’s share amounts to about S$8.6m, partly offset by lower bus earnings following the loss of the Tampines bus package from 2H26.
Maintain investment thesis.
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