The latest PPT from SMRT on the "deal". The total train biz EBIT (fare + non-fare) was 78 million, with EBIT margin 9.5%. The new formula, enable the risk-sharing and also profit sharing among LTA/SMRT in rail operation. SMRT get less, but more secured biz from the "deal".
http://infopub.sgx.com/FileOpen/Slides%2...eID=413002
Security now last only 15 years
I think this deal is pretty watershed on the govt's thinking of what is a reasonable margin for transport business in an operator model. I'm not sure how the profit collar works in reality ie for example does a one year bonus for staff pushing OM to below 3.5% qualify?
But of course on the structure side transport companies can improve the ROE through capital management but without sizable assets it will be limited.
I think it is a good deal for the public consumer. I think the operator model is a good compromise between capex spending for public / social infrastructure vs Singapore Inc mentality.
(18-07-2016, 10:01 AM)specuvestor Wrote: [ -> ]Security now last only 15 years
I think this deal is pretty watershed on the govt's thinking of what is a reasonable margin for transport business in an operator model. I'm not sure how the profit collar works in reality ie for example does a one year bonus for staff pushing OM to below 3.5% qualify? But of course on the structure side transport companies can improve the ROE through capital management but without sizable assets it will be limited.
I think it is a good deal for the public consumer. I think the operator model is a good compromise between capex spending for public / social infrastructure vs Singapore Inc mentality.
I believe the BOD will know what not to do.
SMRT Corporation Ltd wishes to announce a continuation of the trading halt pending a possible announcement
maybe Temasek (54.1% stake holder in SMRT) saying "I'm abstaining !!, all ye OPMIs go take on LTA+Min Transp... if not happy with the deal...
At price-to-book of 2.5? Seems hardly worth it.
Temasek only need to beat 2.5% OA rate?! Hahaha.
(18-07-2016, 01:26 PM)opmi Wrote: [ -> ]Temasek only need to beat 2.5% OA rate?! Hahaha.
our "old and trusted"
opmi has once again, got a prediction spot on..ahha
anyways, Temasek doesn't use CPF funds to invest, if that is what you are insinuating.