Sattva Engineering Construction Limited has secured a ₹125.34 crore contract from the Chennai Metropolitan Water Supply and Sewerage Board (CMWSSB) to design, build, and operate a 47 MLD (million liters per day) water treatment plant in Surapet, Chennai. The order also includes a 10-year operation and maintenance (O&M) period, providing a stable revenue stream and long-term engagement for the company.
The announcement has positively impacted the market, with Sattva Engineering’s stock hitting the upper circuit of 5%, reflecting strong investor confidence in the company’s project execution capabilities and growth prospects in the water infrastructure sector.
Project Details
- Client: Chennai Metropolitan Water Supply and Sewerage Board (CMWSSB)
- Project Value: ₹125.34 crore (approx.)
- Scope of Work: Design, Build, Operate, and Transfer (DBOT) a 47 MLD water treatment plant
- Location: Surapet, Chennai
- Duration: Includes a 10-year O&M period
- Significance: Provides long-term operational visibility and recurring revenue
The project scope includes end-to-end water treatment plant development, encompassing civil construction, mechanical and electrical installations, water filtration, and distribution systems. The O&M component ensures consistent performance monitoring, maintenance, and quality control over a decade, aligning with modern urban water supply standards.
Company Expertise & Capabilities
Sattva Engineering has extensive experience in water infrastructure and wastewater management, with several completed and ongoing projects across India. The company specializes in designing and executing municipal and industrial water projects, providing integrated solutions from construction to operational management.
This new contract adds to its portfolio of strategically important water infrastructure projects, strengthening its presence in urban water supply and sewage treatment segments.
Market & Investor Response
Following the announcement:
- The company’s stock hit a 5% upper circuit, signaling strong investor interest.
- Analysts noted that the long-term O&M period enhances revenue stability, providing Sattva Engineering with a predictable cash flow over the next decade.
- Market experts view this order as validation of the company’s project execution capabilities, potentially boosting its bidding prospects for similar municipal water projects in other regions.
Strategic Importance
The Surapet water treatment plant is a crucial infrastructure project for Chennai’s growing population, ensuring safe, treated water supply to residential, commercial, and industrial areas. The long-term O&M agreement further ensures that quality standards and regulatory compliance are maintained throughout the lifecycle of the plant.
Key benefits for Sattva Engineering:
- Revenue Visibility: The sizeable contract increases the company’s near-term revenue forecast, strengthening its financial position.
- Recurring Income: The 10-year O&M period provides sustained, recurring income, improving cash flow predictability.
- Sector Leadership: Successfully executing this project reinforces the company’s reputation as a reliable player in water infrastructure.
- Growth Opportunities: Completion of this project may pave the way for similar large-scale municipal and industrial water contracts across India.
Conclusion
The ₹125.34 crore Surapet water treatment project is a significant milestone for Sattva Engineering, combining short-term construction revenue with long-term O&M income. The market’s positive reaction, reflected in the stock’s upper circuit, underscores investor confidence in the company’s execution capabilities and growth trajectory in India’s water infrastructure sector.
With urban water demand rising across major cities, projects like these position Sattva Engineering to capitalize on future municipal and industrial water treatment opportunities, ensuring sustainable growth and operational stability.
Summary
- Company: Sattva Engineering Construction Limited
- Project: 47 MLD Water Treatment Plant in Surapet, Chennai
- Contract Value: ₹125.34 crore
- Scope: Design, Build, Operate, and Transfer (DBOT) including 10-year O&M
- Market Reaction: Stock hit 5% upper circuit
- Significance: Enhances revenue visibility, provides recurring income, strengthens sector reputation, and opens future growth avenues in water infrastructure
Disclaimer:
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