ComfortDelGro Corp > Hold OCBC Investment Research, Feb 2 Feb 2 close: S$2.14 Fair value: S$2.12

COMFORTDELGRO is reported to be scaling up on its petrol station business to serve its growing fleet of hybrid taxis, which we believe makes sense given the change in fleet profile. However, we do not think this will provide much lift to earnings, at least not until CDG's petrol station starts to serve the larger private hire car fleet of Uber, post approval of the CDG Uber alliance. We believe the latter has potential to more than offset the declining diesel sales.

Another recent news report cited market chatter that Grab is in talks to acquire Uber's operations in South-east Asia. Uber has refuted the claims and we advise investors against speculating on such market rumours.