ComfortDelGro (CD SP): BUY Recommendation – 2025 Analysis, Target Price & Growth Outlook

Maybank Research Pte Ltd

May 15, 2025

ComfortDelGro: A Matter of Timing – Expect Sequential Growth

ComfortDelGro (CD SP) Investment Overview

ComfortDelGro (CD SP) is analyzed with a Buy rating and a target price (TP) of SGD 1.64, indicating an 8% upside.
The recommendation is to Buy on share price weakness.

Core PATMI: 1Q25 core PATMI reached SGD 51.2m, a 51.9% year-over-year increase, representing approximately 22%/21% of MIBG/consensus full-year forecasts [[1]].
Exclusions: Results exclude non-cash purchase price allocation (PPA) amortisation for CMAC, A2B, and Addison Lee, along with other one-off items [[1]].
Operating Profit: Improved across Singapore segments due to cost control and internal efficiency gains [[1]].
Net Profit Impact: Higher net interest expense from increased borrowings for overseas acquisitions last year dragged net profit [[1]].
Forecasts: FY25-27E forecasts remain unchanged with a DCF-based TP of SGD 1.64 [[1]].

Revenue Growth: 1Q25 public transport revenue increased by 2.6% YoY to SGD 760m [[1]].
Key Drivers: Growth attributed to the UK Metroline Manchester contract (started in Jan’25) and higher rail fare revenue in Singapore [[1]].
Offsetting Factors: Partly offset by lower service fees for buses due to the loss of the Jurong West package from Sep’24 [[1]].
EBIT Margin: Rose 1.6ppt YoY to 4.8% (flat QoQ) due to renewal of the UK Metroline London contract at better margins [[1]].
Industry Dynamics: Industry-wide shortage of bus drivers in Australia is easing [[1]].
Tender Bids: SBS Transit bid for the PT220 Tampines bus tender, with results expected in Jul/Aug’25. This new package will commence on 16 Jul 2026 [[2]].

Revenue/EBIT Surge: Taxi & private hire revenue/EBIT surged by 74%/51% YoY to SGD258m and SGD35m in 1Q25 [[2]].
Key Contributions: Driven by contributions from A2B (SGD2.9m operating profit) and Addison Lee (SGD7.2m operating profit) [[2]].
EBIT Margin: Narrowed by 2.1ppt YoY to 13.6%, partly due to seasonality and increased market competition, especially with more ride-hailing players in Singapore [[2]].
Fleet Size: CD‘s taxi fleet size has been shrinking to >8,200, but has onboarded about 6,500 private hire drivers to its Zig platform [[2]].

Turnover Contribution: Overseas turnover accounted for 52.6% of total revenue (1Q24: 43.3%) for the first time [[2]].
Acquisition Impact: Last year’s acquisitions of CMAC, A2B, and Addison Lee contributed in 1Q25 [[2]].
Integration Progress: Management noted that Groupwide Point-to-Point (P2P) businesses and technology integrations are progressing well following completion of the deals [[3]].
Contract Wins: CMAC’s Suntransfers secured a major exclusive contract with On The Beach, a large UK online package holiday specialist with a customer base of approximately 2m passengers annually [[3]].

ComfortDelGro is a land transport conglomerate with diversified business interests in taxi, bus, and rail globally [[4]].

52w High/Low (SGD): 1.54/1.33 [[4]].
3m Avg Turnover (USDm): 11.4 [[4]].
Free Float (%): 93.8 [[4]].
Issued Shares (m): 2,167 [[4]].
Market Capitalisation: SGD3.3B / USD2.5B [[4]].
Major Shareholders: Ameriprise Financial Inc (6.8%), BlackRock Inc (5.0%), T Rowe Price Group (2.8%) [[4]].