ComfortDelGro's Bus Unit Could Post Softer Operating Profit

Dow Jones
Yesterday

0310 GMT - ComfortDelGro's bus subsidiary is still likely to post a softer operating profit in 2027 despite a higher-than-expected fare hike in Singapore, says DBS Group Research's Zheng Feng Chee in a note. Singapore's public transport council announced an overall fare increase of 7% effective Dec. 26, which the analyst says reflects the recent sharp rise in energy costs. However, he reckons that the latest increase is unlikely to fully offset higher operating expenses if fuel and electricity costs remain at elevated levels. Its subsidiary, SBS Transit, is likely to post a 3% decline in 2027 operating profit on higher costs and the loss of some bus packages, he adds in a note. DBS retains its hold rating and a 1.40 Singapore dollar target price for ComfortDelGro. Shares are flat at S$1.27.

 

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