The Straits Times / The Business Times News on Hyflux

Hyflux bags four water treatment projects in China

By TETTYANA JASLI
March 29, 2007
The Business Times

Totalling 253m yuan, 1 project is in Jiangxi, 3 in Jiangsu

HYFLUX has secured four water-treatment projects worth 253 million yuan (S$49.7 million) in China.

The projects, won through wholly owned subsidiary Newspring Utility Pte Ltd (NUPL), include a 25-year concession from Leping City in Jiangxi province to design, construct, operate and maintain a 20,000 cubic metres a day waste-water treatment plant. The plant, with an estimated value of 40 million yuan, is expected to be completed by mid-2009.

The other three projects, all in Jiangsu province, are:

• a 30-year concession from Yancheng City for a 50,000 cu metres a day potable water-treatment plant, estimated at 80 million yuan and expected to be completed by end-2008;
• another 30-year concession, from the Management Bureau of Guanyun Economic Development District, for a 30,000 cubic metres a day waste water-treatment plant. Estimated at 56 million yuan, the plant is expected to be completed by end-2008; and
• yet another 30-year concession, also in Guanyun Economic Development District, for a 50,000 cubic metres a day potable water-treatment plant, estimated at 77 million yuan and targeted for completion by end-2008.

For all four projects, Hyflux has the first right to negotiate for extension upon the expiry of the concession terms.

The four projects will be funded from Hyflux's existing term loan facilities and are not expected to have a material financial impact of the group's current financial year.

With the announcement of these projects, the group's subsidiaries now have a portfolio of 20 projects in China.

JP Morgan has maintained an 'overweight' rating on the stock of Hyflux, while ABN Amro has recommended a 'buy' with a target price of $3.14.