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16-11-2014, 12:35 PM
(This post was last modified: 16-11-2014, 01:02 PM by greengiraffe.)
I view taxi services in Singapore as a social utility:
i) it is a controlled entrepreneurship (including those who are affected structurally) for those who are responsible enough to put food on the table
ii) it remains a social luxury just a tier below expensive car ownership due to land scarce and over population - government is responsible for this policy
iii) its a utility as it is well regulated and frankly noone owns anything - taxi companies simply owns a right to operate a lease fleet and hirers being licenced to operate a business, both parties in compliance of guidelines
In view of the above, then it should be view as win-win-win:
i) Govt collects revenue from COEs, taxes from taxis on the road and responsible citizens (drivers) get to be get on with life with their business takings. Separately many drivers also have their usage of their cabs for family consumption after plying the roads.
ii) Consumers have a preferred personalised transport mode without going through the pains of car ownership
iii) Efficient taxi companies gets to operate a fleet for the stipulated period of time in compliance with regulations. Of course stakeholders of taxi companies need to be rewarded for their capital invested in the operators to be the preferred social utilities.
Hence, the approach to evaluate Transcab and Comfort Delgro's taxi unit from the investors' perspective is via a simple approach - cashflow to meet capex and shareholders return via dividends. Regulatory concerns are likely to be minimised in view of the social considerations here and a proven model for policy makers that is well-oiled and well.
Vested
IPO Placement
GG
i) it is a controlled entrepreneurship (including those who are affected structurally) for those who are responsible enough to put food on the table
ii) it remains a social luxury just a tier below expensive car ownership due to land scarce and over population - government is responsible for this policy
iii) its a utility as it is well regulated and frankly noone owns anything - taxi companies simply owns a right to operate a lease fleet and hirers being licenced to operate a business, both parties in compliance of guidelines
In view of the above, then it should be view as win-win-win:
i) Govt collects revenue from COEs, taxes from taxis on the road and responsible citizens (drivers) get to be get on with life with their business takings. Separately many drivers also have their usage of their cabs for family consumption after plying the roads.
ii) Consumers have a preferred personalised transport mode without going through the pains of car ownership
iii) Efficient taxi companies gets to operate a fleet for the stipulated period of time in compliance with regulations. Of course stakeholders of taxi companies need to be rewarded for their capital invested in the operators to be the preferred social utilities.
Hence, the approach to evaluate Transcab and Comfort Delgro's taxi unit from the investors' perspective is via a simple approach - cashflow to meet capex and shareholders return via dividends. Regulatory concerns are likely to be minimised in view of the social considerations here and a proven model for policy makers that is well-oiled and well.
Vested
IPO Placement
GG