KUALA LUMPUR (Jan 2): PBA Holdings Bhd, whose main subsidiary Perbadanan Bekalan Air Pulau Pinang (PBAPP) is the licensed operator for water supply in Penang, saw its share price surge to RM1.89, its highest since the company's listing.

The stock opened at RM1.52, up six sen or 4.11%, before surging 43 sen or 29.45% to an intra-day high of RM1.89. The stock then pared gains to close at RM1.81, still higher by 35 sen or 23.97%. It was the fifth top gainer on Bursa Malaysia.

At its closing price, PBA Holdings has a market capitalisation of RM483.65 million, accompanied by 12.24 million shares traded.

Earlier on Tuesday, Penang Chief Minister Chow Kon Yeow announced that the state will be signing either a memorandum of understanding or an agreement on financing with Perak on the Sungai Perak water scheme in 2024.

Under the scheme, Perak will be supplying Penang with treated water, with Penang requesting for 700 million litres of water per day, according to the Malay Mail.

The scheme is part of the Penang Water Contingency Plan 2030, where PBAPP will be spending RM1.18 billion over the next few years to increase the state's water supply to 602 million litres per day.

The announcement comes as Penang faces a four-day scheduled water cut that is expected to affect 85% of the state next week.

The state had also applied to the National Water Services Commission (SPAN) to increase water tariffs for domestic customers, citing the need to reduce subsidies and ensure sustainability.

To note, PBA Holdings earlier reported revenue which rose 25.97% year-on-year (y-o-y) to RM114.31 million in 3QFY2023, which the group attributed to the higher water tariffs for non-domestic and special categories that took effect from Jan 1, 2023. 

However, its net profit for 3QFY2023 declined 18.38% y-o-y to RM36.76 million, partly due to higher operating expenses and finance costs. The company also declared a first interim single tier dividend of 1.75 sen per share for the financial year ending Dec 31, 2023.