Key Takeaways
Primech Holdings (Nasdaq: PMEC) secured a four-year, $24.8 million cleaning contract from a major Singapore aviation hub, bolstering its recurring revenue base and sending its shares up more than 6 percent.
"Securing a four-year mandate of this scale at one of Asia’s most demanding facility environments reflects the depth of our service capabilities and our ability to compete and win at the highest institutional level," said Ken Ho, Chairman and Chief Executive Officer of Primech Holdings.
The contract, one of the largest in the company's history, covers routine and periodic cleaning at a high-volume passenger terminal. It follows approximately $33 million in multi-year university contracts announced in March, bringing the total for major institutional agreements in the last two months to nearly $58 million. The stock reacted positively to the May 7 announcement, gaining 6.34% to $0.70 in the session.
The series of large, multi-year contracts is central to Primech's strategy to create predictable, long-term revenue streams and reduce earnings volatility. For a company with a market capitalization of just over $25 million and a net loss of $806,000 in the six months ended September 30, 2025, securing a contract pipeline worth more than twice its market cap is critical for achieving profitability and building investor confidence.
Primech has been actively securing long-term institutional mandates to enhance its financial stability. The aviation contract, combined with the recent university agreements, provides significant forward revenue visibility. This is in addition to a $24 million public sector contract for cleaning hawker centres announced in April and $3.45 million in industrial cleaning contracts.
Management has emphasized that these large-scale agreements allow the company to deploy its existing manpower and digital management systems more efficiently, which could support margin durability. The company uses real-time performance dashboards and data-driven scheduling to manage its services, a factor it cites as a key differentiator in winning contracts for complex, high-traffic environments like airports.
Despite the series of positive announcements, Primech's stock is down approximately 47% over the past six months, trading at $0.66 as of the announcement date, according to Investing.com data. The company was not profitable over the last twelve months, with LTM revenue standing at $75.47 million.
However, the recent contract wins represent a significant portion of this revenue, suggesting a potential turnaround. The combined $57.8 million from the aviation and university contracts alone represents about 77% of the company's entire revenue for the last twelve months. In a sign of internal confidence, CEO Kin Wai Ho purchased 839,963 shares on the open market for an estimated $958,649 on March 23, according to filings.
This article is for informational purposes only and does not constitute investment advice.
