Is five a crowd for Singapore’s public bus operators?

SINGAPORE (Jan 25): Singapore’s bus infrastructure landscape has been transforming rapidly over the past year, and there can be only one Singapore-listed stock that could possibly gain from it all.

In its Singapore Strategy report last week, Daiwa Capital Markets highlighted ComfortDelGro as the key beneficiary of the industry’s recent changes through its bus transport subsidiary SBS Transit – especially since the bus contracting model (BCM) began taking effect in Sept 2016.

While foreign bus operators Go-Ahead and Tower Transit have already been named as the new entrants under the model, the research house believes the increased competition is outweighed by the benefit of having the Singapore government shoulder the revenue risk previously faced by bus operators.

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