Thursday, July 16, 2020

Added: ComfortDelGro (CDG)

Bought 14,000 Comfortdelgro (CDG) shares at $1.45 on 16 Jul.

Reasons for buying:
1) Share price at 8 years low

It reached 52w low of $1.33 in Mar 2020.
Putting aside 2020 pricing, the last time it at $1.45 range is around 8 years ago.

2) Grab and GoJek are burning cash daily (Unprofitable) vs ComfortDelGro (Profitable)

Grab CEO says the company can go public ‘once we’re profitable’

Grab CEO: No IPO Until Business Shows Profits

As Grab expands to food and finance, its transport business is no longer driving most of its growth

3) Singapore out of Circuit Breaker since 2 June

4) Joint Bid for France metro projects
ComfortDelGro Ties Up With RATP Dev And Alstom To Jointly Bid For Metro Projects In France

5) COVID Vaccine
US biotech firm Moderna would enter the final stage of its human trials on July 27. The study should run until Oct 27.

China's SinoVac is also at an advanced stage, Phase 2, while the Russian news agency TASS has announced Russian researchers have completed clinical trials on a vaccine, though they have not shared data.

CDG will be releasing their 1H result on 15 Aug 2020.

This 1H result will be very bad given that:
- CDG had provided Full Rental waiver for Taxi till 1 June
- the ridership of Train & Buses dropped during Circuit Breaker
- CDG issued Profit Guidance (expecting net loss) on 26 Jun 

It is important to note that:

CDG continue to provide 50% rental waiver for taxi till 15 Jul and 40% rental waiver till 15 Aug.

There is also high chance that there is no dividend declared since CDG is receiving Relief fund from Government.

CDG share price might go lower within the next few months.
However, I am comfortable with $1.45 share price as only minority of investor is able to catch at the lowest price.

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