SMRT will be in talks with China-based BYD to sell and distribute electric vehicles for better air quality, says DMG, citing a report in the Business Times.
DMG says this move speaks of SMRT’s status as one of the leading Asian land transportation companies that promote environmental sustainability.
The news: SMRT’s wholly owned subsidiary, SMRT International Pte Ltd (SMRTI), will enter into discussions with China-based BYD regarding the possibility of establishing a joint venture to develop, distribute, and sell electric vehicles, including e-buses and electric taxi vehicles. It is mentioned that the move is part of SMRT’s commitment to environmental sustainability. In order to further promote better air quality, SMRT is also constantly exploring the use of electric vehicles in its bus and taxi fleet.
Our thoughts: We see SMRT’s latest tie-up with BYD as signs that SMRT is willing to explore the use of electric vehicles in the future should they be economical. The latest move reinforces SMRT’s credential as one of the leading land transportation companies in Asia to actively promote use of green vehicles. Although we like SMRT’s long term commitment to green vehicles, its current valuation remains steep at 18x FY12 PATMI compared to its mean forward
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