SRG wins another multi-million-dollar contract… this time with a steel giant
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The contracts just keep rolling in for construction, maintenance and mining services group SRG Global (ASX:SRG).
Three days after it won a six-year $60m contract with mining heavyweight South32, the junior has announced a six-year $45m contract win with steel giant OneSteel.
And all indications are shares will move north on market open. Watch this space.
SRG Global will provide refractory services for the Whyalla Steelworks site in South Australia.
The term of the contract is for an initial four years, which will deliver an initial $30m of the revenue total, with options to extend for a further two years.
One expert told Stockhead recently that the infrastructure sector is looking a lot like the mining sector did right before it took off back in 2009.
“In the first half, and actually more recently, a lot of the companies exposed to this sector have seen delays and weather impacts, but all that’s done has pushed the work into next financial year,” said Andrew Smith, head of smaller companies & micro caps/head of research for investment firm Perennial Value Management.
“The work hasn’t gone away; the actual pipeline has got bigger. There’s unprecedented work.”
This is thanks to a government-funded East Coast infrastructure boom that is expected to run for the next four years at least.
“It feels a lot like the start of the mining boom did in 2009 and I think we’re here now in the infrastructure space,” Smith explained.