ComfortDelGro Corp. has lost S$500 million ($370 million) in just four months — on track to become Singapore’s second-worst performing stock in 2017 — as investors lose patience over a planned venture with Uber Technologies Inc.
More than three months after the operator of Singapore’s largest taxi fleet said it is in talks with Uber Technologies Inc. for a potential alliance, nothing has been announced.
ComfortDelGro has lost about 11 percent of its value since announcing the negotiations in August. The stock’s market capitalization has declined by $1.2 billion so far this year, mainly on concerns about its taxi business.
Company executives have “hinted” that the discussions with Uber would likely end by the end of 2017, but no commitment has been given, Eugene Chua, an analyst at OCBC Investment Research wrote in a note on Nov. 29.
Investors should remain cautious even if a deal is reached as competitor Grab could “respond promptly” to the alliance, he said. Grab, Southeast Asia’s biggest ride-hailing app, launched aggressive promotions to attract ComfortDelGro’s drivers soon after the Uber talks were announced, Chua said.
And just this week, Grab President Ming Maa said Uber is “under siege” from multiple rivals in many geographies for the first time this year, speaking at the Bloomberg’s Year Ahead Asia Conference in Jakarta.