AWC, via Stream Singapore, has secured a SGD3.9m (RM12.8m) contract from Singapore’s HDB to design, build and operate a PWCS at Project DC & DD. The award lifts AWC’s outstanding order book to c.RM607.2m (1.5x FY25 revenue).
HDB’s plan to launch 55,000 new BTO flats (2025-2027) continues to support PWCS demand in Singapore. Stream Singapore, as one of the key incumbents with a proven execution track record and extensive installed base across multiple estates, stands to benefit from additional contracts and recurring O&M revenue opportunities.
SGD3.9m PWCS Contract in Singapore. AWC, via its indirect wholly-owned subsidiary Stream Environment (S) Pte Ltd, has secured a contract from the Housing & Development Board (HDB) of Singapore to design, build and operate (DBO) a Pneumatic Waste Conveyance System (PWCS) at Project DC & DD. The contract is valued at SGD3.9m (c.RM12.8, based on SGD/MYR of 3.27) and encompasses the full DBO package for PWCS infrastructure. The design phase for both projects is scheduled from 2 October 2025 to 1 October 2026, followed by a 24-month construction period commencing upon instruction.
Our Take. We view the award positively as it reinforces Stream Singapore’s position as a key incumbent in Singapore’s PWCS market. Earnings contribution should begin in FY26F during the design phase, with larger recognition in FY27F-FY28F as construction progresses. While the operational tenure was not disclosed, we benchmark against AWC’s recent 10-year concession win at Terminal Bersepadu Gombak and assume a similar 10-year concession period. Assuming 80% of the contract value (c.SGD3.1m) is allocated to design and build, and applying a PBT margin of 9%, the contract is expected to generate c.RM0.9m in PBT over its 24-month duration. Although relatively small in value, the award enhances multi-year earnings visibility and provides a pathway to recurring O&M revenue in Singapore. Incorporating this win (excluding O&M), AWC’s outstanding order book is estimated at RM607.2m (1.5x FY25 revenue), supporting medium-term earnings visibility.
Outlook. The outlook for PWCS demand in Singapore remains supported by Housing & Development Board (HDB) initiatives. HDB has announced plans to launch 55,000 new BTO flats between 2025 and 2027, alongside ongoing township developments in Clementi, Bukit Merah, Toa Payoh, and Alexandra. This sustained pipeline of public housing projects provides recurring opportunities for PWCS installations as HDB continues to integrate sustainable waste management systems in new estates. As one of the key incumbents, Stream Singapore is well positioned to secure further contracts, supported by its proven execution track record and extensive installed base across multiple estates.
Earnings revision. We make no changes to our earnings forecasts, as the latest contract win falls within our FY26F order book replenishment, while the O&M contribution lies outside our current forecast period.
Valuation. We maintain our BUY recommendation with an unchanged TP of RM0.78, based on 8x FY26F EPS of 9.7 sen and supported by a three-star ESG rating. We like AWC for its (i) leading AWS system market share (90% in Malaysia, 40% in Singapore), (ii) predictable cash flows from both concessionaire and non-concessionaire segments, and (iii) promising growth prospects from untapped projects in Abu Dhabi, which collectively represent a potential RM1bn order book.
Risks. Failure to secure improved rates for government concession contracts under the IFM segment, slower-than-expected order replenishment in the Environment segment, and potential delays in mega infrastructure projects that could weigh on Rail segment prospects.
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Currency | Buy Rates (RM) | Sell Rates (RM) |
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USD | 4.212894 | 4.246402 |
EUR | 4.925348 | 4.934954 |
CNY | 0.592662 | 0.593823 |
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