ComfortDelGro

ComfortDelGro: (S$2.80) Newcomers join hands to tackle incumbents as competition heats up
- Competition is intensifying in the taxi industry as a surge in private car rental fleet exacerbates the entry of new players collaborating with Uber and Grab
- Apart from their own networks, Uber and Grab could also disrupt the industry through partnerships with start-ups.
- The growing number of private rental cars appear to bode well for Uber and Grab. This contrasts with difficulties CDG currently faces in recruiting new drivers.
- With technological disruption here to stay, private rental car hires are poised to eat into the market share of incumbents.

CDG is currently trading at 18.6x forward P/E with an indicative yield of 3.3%. The street is still fairly bullish on the counter with 10 Buy, 4 Hold, and 1 Sell ratings with consensus TP of $3.14.