ComfortDelGro could gain $10.9m in rail revenue amidst fare hikes

The fare hikes will be rolled out by 29 December.

ComfortDelGro (CDG) could gain an addition $10.9m in their annual rail revenue amidst the 4.3% fare hikes, the Public Transport Council (PTC) said.

“We think this could help turn its rail operations around from losses sooner than expected,” CGS-CIMB said.

The PTC announced that the fare hikes which will be applicable to both trains and buses will roll out by 29 December.

As part of the 2018 Fare Review Exercise, CDG subsidiary SBS Transit, will be required to contribute 5% of its expected increase in fare revenue to the Public Transport Fund, which will be tapped by the government to issue vouchers for lower income families to cope with the fare adjustments.

Also read: ComfortdelGro H1 profits fell 12.7% to $141.3m

Meanwhile, CGS-CIMB thinks that the recovery of the firm’s taxi earnings could be hit by a possible revival in Private-Hire Car competition following the entry of a new player into the market.

In H1, CDG’s profits fell 12.7% YoY to $75m. Its taxi fleet saw a revenue dip of 12% to $184.7m due to its smaller operation.