Grab (GRAB – Research Report), the Technology sector company, was revisited by a Wall Street analyst today. Analyst Divya Gangahar from Morgan Stanley maintained a Buy rating on the stock and has a $5.70 price target.
Divya Gangahar’s rating is based on several strategic developments that position Grab favorably in the Singapore market. The awarding of a street-hail operator license to Grab is a significant milestone, allowing the company to expand its fleet in a market where supply is limited. This move not only strengthens Grab’s leadership in the ride-hailing sector but also enhances its ability to serve a broader customer base by improving ride availability, especially during peak times and in areas where taxis are more accessible.
Furthermore, the license enables Grab to tap into the street-hail segment, which accounts for a substantial portion of daily trips. Although a previous attempt to acquire Trans-Cab was unsuccessful, the potential to increase its fleet to meet the minimum requirement of 800 taxis over the next couple of years remains promising. The Singapore government’s recent regulatory changes to ease operational restrictions for taxi operators also provide a supportive environment for Grab’s growth. These factors collectively contribute to Divya Gangahar’s Buy rating for Grab’s stock.