Assuming revenue growth of 10% to 15% y-o-y, similar to ComfortDelGro’s (CDG) (SGX:C52
) taxi segment recovery in FY2022), Trans-cab’s FY2022 net profit would stand at $9.1 million to $9.8 million. This indicates a trailing P/E acquisition multiples of 10x to 11x P/E, assuming a $100 million purchase consideration.
Increasing driver supply, realising cost synergies and earnings accretion are key reasons for Grab’s acquisition of Trans-cab, CGS-CIMB Research analysts Ong Khang Chuen and Kenneth Tan note in their July 20 report.
Grab announced on Thursday that it has acquired the third largest taxi operator in Singapore with a fleet size of 2,500 cars. The transaction is expected to close by 4Q2023.
