Australia buys could uplift ComfortDelGro's earnings

They are related to the firm's expertise which is public transport.

The acquisition of Australian companies could boost ComfortdelGro’s (CDG) earnings, DBS Equity Research said.

The research firm added that the purchases are related to public transport which is within the firm’s expertise.

“Whilst this is the largest acquisition for the group in Australia to-date, it still represents a bite-size and bolt-on type of investment, which we view positively as it helps to diversify risk,” DBS Equity Research commented.

Moreover, the research firm thinks that the competition scene for private hire and taxi industry will not be ‘prolonged’ over the upcoming debut of Go-Jek in Singapore.

DBS Equity Research noted that CDG kept its pace in its investment strategy and has in fact revealed that it wants to focus on other opportunities which leverage on technology and artificial intelligence.

CDG’s Australian arm acquired Buslink Pty Ltd and Buslink Southern Pty for $165m (A$168.2m) which operate a fleet of 401 buses across four states in Australia providing public bus, school bus, and charter bus services.

The firm believes that the acquisition will enable CDC Australia to extend its footprint into the Northern Territory and Queensland markets and also expand its bus operations in New South Wales and Victoria, where it already operates more than 2,250 buses.