ComfortDelGro, SBS gain ground on board changes, new share scheme

Both transport stocks are up again this week, on the back of investor updates from SBS Transit.

  • ComfortDelGro Corp (SGX: C52) share price hits S$1.70 on Thursday (25 March 2021)
  • SBS Transit Ltd (SGX: S61) rose nearly 2% to S$3.13 in the same session
  • The gains came after SBS Transit announced several board changes, including the retirement of its current Chairman Lim Jit Poh
  • Last week, ComfortDelGro’s stocks also rallied after announcing a S$50 million clean energy investment
  • Trade ComfortDelGro and SBS Transit shares with an IG account

ComfortDelGro, SBS Transit shares rising again

Shares of land transport operator ComfortDelGro and its 75% owned subsidiary SBS Transit rallied on Thursday (25 March 2021), after board changes were announced by the latter.

Mr Lim Jit Poh, who has been Chairman of SBS Transit since 2003, will retire from the role after 18 years at the helm of the company’s board of directors.

The change will be effective following SBS Transit’s 2021 Annual General Meeting (AGM) on 29 April 2021. Mr Lim will remain as Senior Advisor of SBS Transit.

Two other board members - Mr Benny Lim and Mr John De Payva - will also be retiring at the upcoming AGM having reached the end of their term under the normal rotation rules.

ComfortDelGro shares are up over 3% to S$1.70 as of 14:00 SGT, after having fallen 3.7% in the previous two sessions. Nealy 16 million securities have exchanged hands so far on the day.

SBS shares were up as much as 1.95% to S$3.13 earlier in the session, after being flat at the start of the week.

SBS Transit proposes new employee share scheme

SBS Transit also stated that it will seek the approval of shareholders at the 2021 AGM for the adoption of an executive share award scheme to be named the ‘SBS Executive Share Scheme’, in a circular posted on the same day.

The scheme, according to the letter, is devised to attract, incentivise and motivate senior employees to ensure that the company continues to have a strong leadership team with a sustainable talent pipeline.

‘The scheme is also intended to provide an incentive for senior employees to deliver stretched performance and strategic contributions to enhance long term shareholders’ value,’ the company added.

A remuneration committee, whose primary function is to assist the board in reviewing remuneration matters, has been proposed as the designated body responsible for administering the scheme.

As part of the proposed share scheme, fully paid shares will be awarded to scheme participants as a reward for their contribution or performance in lieu of paying bonus fully in cash, or as an incentive upon achieving certain performance targets aligned with long-term shareholder value or for such other purpose as the remuneration committee may determine pursuant to the rules.

ComfortDelGro’s S$50 million clean energy investment

Meanwhile, ComfortDelGro’s share price also rose by the same amount last week, after announcing it will be committing S$50 million towards clean energy technology and research as part of a larger push towards upping its overall sustainability quotient.

The company has signed a Memorandum of Understanding with the National University of Singapore (NUS) to invest about S$10 million into a mobility-focussed CDG-NUS Smart & Sustainable Mobility Living Lab (CDG-NUS Living Lab) that will focus on Energy Sustainability, Integrated Urban Mobility as well as Smart and Intelligent Mobility Technologies.

It will research, test and analyse mobility technologies to generate insights that could later be implemented in solutions for the mass market.

In addition, the group will also seek to invest another S$40 million to replace its fleet of diesel buses with electric buses, which may be deployed to the NUS Kent Ridge Campus; as well as supporting infrastructure and mobility technologies.

Concurrently, ComfortDelGro Engineering will also seek to explore the introduction of electric vehicle (EV) charging infrastructure into the campus’ car parks to study the impact of using EVs for travelling in and around the campus.

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