ComfortDelgro

ComfortDelgro: Deutsche maintains its Buy rating and $2.85 TP for ComfortDelgro, citing that management is upbeat about bus prospects, given their experience in running a government contracting cost-plus model in its UK and Australia operations. At this point, the government has not yet decided how an at what price to buy existing bus assets from the operators, but ComfortDelgro's bus assets are estimated at a net book value of $900m ($0.42/share). The house reckons that rail reforms should follow, but losses are not as pressing to urge near term reforms. In addition, ComfortDelgro intends to continue seeking growth through acquisition for its overseas business, as well as organic growth for its recently acquired taxi and bus businesses in UK, Australia and China. Balance sheet remains strong with net cash position and the counter currently trades just under 3% yield, excluding the possibility of a potential special dividend from the sale of bus assets to the government.