At least not yet, they add.
Along with the 6.5% increase in profit for the transport firm, more surprises were revealed in ComfortDelGro’s latest results, including its resilient taxi earnings.
According to Maybank Kim Eng, it was expecting some sign of weakness from the firm’s taxi business, but in contrary, its earnings grew by 8.6% to $163.9m.
“It appears that new entrants have yet to affect profitability of traditional operators,” Maybank Kim Eng said.
So why the resilience? Maybank Kim Eng says a number of factors for the resilience of the taxi business, including support to driver’s earnings from rising income in Singapore (2015 median income up 6.5%YoY); general taxi shortfall in the market; and rebounding tourism traffic.
Meanwhile, Maybank Kim Eng adds that 0.8% of its fleet is currently idle.
On the other hand, some concerns lay in store for the Singapore bus and rail transition.
“While the bus operators will transit to a new operating model from Sep 2016, details of the asset transfer remain under negotiation, and one should not be too certain of a windfall from any asset sale,” Maybank Kim Eng said.
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