NRW Holdings Expected to See Low Margins, High ROCE From New AU$750 Million Contract, Says Jefferies

MT Newswires Live
Jan 20

NRW Holdings (ASX:NWH) is expected to see low profit margins but high return on capital employed from a new AU$750 million contract secured by its unit, according to a Tuesday Jefferies note.

The company on Monday said its subsidiary Golding Contractors has secured a AU$750 million mining services agreement with TEC Coal at the Stanwell Meandu mine in southern Queensland, according to a Monday filing with the Australian bourse.

The investment firm said it likes NRW Holdings' recent acquisition of Fredon and sees the revenue diversification inherent in this acquisition into sectors like data centers as highly strategic.

Jefferies kept a hold rating on NRW Holdings and increased its price target to AU$5.60 from AU$5.25.

The company's shares fell 1% in recent Tuesday trade.

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