Stock Name: ComfortDelGro
Company Name: COMFORTDELGRO CORPORATION LTD
Phillip Securities Research in an Aug 31 research report says: "The Land Transport Authority (LTA) announced the award of Downtown Line (DTL) to ComfortDelGro's (CDG) 75% owned subsidiary, SBS Transit (SBST). The licence tenure had also been reduced to 15 years with charges of $1.6 billion over 19 years.
"Under the new rail financing framework, LTA would own the operating assets and lease them to SBST for a fee that would be accumulated in a "Railway Sinking Fund" to finance future CAPEX. We estimate total nominal revenue generated over the 19 years of operations to be approximately $3.5-4 billion.
"We used a blended valuation model of DCF and P/E (15X FY11e PATMI) to arrive at our target price of $1.83. CDG could potentially return 40% after incorporating our forecasted dividends of 5.5 cents over the next 12months. MAINTAIN BUY."
Company Name: COMFORTDELGRO CORPORATION LTD
| Research House: Phillip Securities | Price Call: BUY | Target Price: 1.83 |
Phillip Securities Research in an Aug 31 research report says: "The Land Transport Authority (LTA) announced the award of Downtown Line (DTL) to ComfortDelGro's (CDG) 75% owned subsidiary, SBS Transit (SBST). The licence tenure had also been reduced to 15 years with charges of $1.6 billion over 19 years.
"Under the new rail financing framework, LTA would own the operating assets and lease them to SBST for a fee that would be accumulated in a "Railway Sinking Fund" to finance future CAPEX. We estimate total nominal revenue generated over the 19 years of operations to be approximately $3.5-4 billion.
"We used a blended valuation model of DCF and P/E (15X FY11e PATMI) to arrive at our target price of $1.83. CDG could potentially return 40% after incorporating our forecasted dividends of 5.5 cents over the next 12months. MAINTAIN BUY."
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