KUALA LUMPUR (March 20): Water and wastewater engineering company Salcon Bhd (KL:SALCON) has secured a RM167 million contract for the construction of a new water treatment plant, raw water pipeline, and related infrastructure in Melaka.

The contract was awarded to Salcon Engineering Bhd (SEB), a wholly owned subsidiary of Salcon, by Pengurusan Aset Air Bhd (PAAB).

PAAB, a wholly owned entity of the Minister of Finance Inc, is responsible for developing the nation's water infrastructure in Peninsular Malaysia and the Federal Territory of Labuan.

According to Salcon’s bourse filing on Thursday, the project includes the construction, completion, and commissioning of a 1,200mm diameter raw water main pipeline and a 90 million litres per day (MLD) water treatment plant.

The company noted that the contract is a one-off construction agreement with no renewal option.

Work will begin upon site possession, with completion targeted within 30 months, Salcon said.

"We are honoured to be entrusted by PAAB with this critical project, reaffirming Salcon’s expertise in water infrastructure development," said SEB chief executive officer Jamiluddin Amini Sulaiman in a separate statement.

He added that the initiative will enhance treated water supply and distribution in the Alor Gajah district and surrounding areas, supporting PAAB’s commitment to ensuring clean water access for Melaka residents.

Jamiluddin also highlighted that this contract strengthens Salcon’s infrastructure portfolio and is expected to positively impact the group’s earnings and net assets for the financial years ending Dec 31, 2025, and beyond.

The latest contract marks Salcon’s fourth contract win since the beginning of the year.

On Feb 14, SEB accepted a letter of acceptance from PAAB for a pipe replacement contract in Kota Bharu, Kelantan, worth RM70.52 million.

Meanwhile, another Salcon subsidiary, Envitech Sdn Bhd, secured two wastewater-related contracts worth RM99.8 million on March 17.

The first contract, valued at RM88.8 million, was awarded by Penang Development Corporation to construct wastewater infrastructure in Batu Kawan Industrial Park. The project is expected to take 18 months to complete.

The second contract, worth RM11 million, was awarded by Binastra Builders Sdn Bhd for the redevelopment of a wastewater treatment plant in Cheras.

Shares in Salcon closed unchanged at 30 sen on Thursday, valuing the company at RM310.6 million. The stock is up 9.09% this year.

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