Brokers' take

ComfortDelGro (CDG) | Buy (upgraded) Oct 2 close: S$2.41 Target price: S$2.76 Maybank Kim Eng, Oct 1

CDG has de-rated and underperformed the STI over the past one and three months on no major unexpected news. The share price implies a "no fare hike" scenario for Singapore public transport which we think is not justified.

Aside from the Transport Minister indicating in July 2019 that rail operators such as CDG may receive some form of grant, the public transport council has also indicated a potential 7 per cent fare hike recently. We previously upgraded our forecasts for the former but not the latter. We believe it is reasonable for at least one of these events to take place in FY2020 and optimistic for both and hence maintain our current forecasts.