Afcon Wins Another Power Substation Contract Worth $7 Million

Afcon Holdings' subsidiary, Afcon Control and Automation, has secured a new contract from the Israel Electric Corporation (IEC) to construct the Shahar Kochav Michael substation. The project is valued at approximately NIS 26.3 million (around $7 million USD) and is indexed to the construction input price for residential buildings.

Work on the substation is slated to commence on October 11, pending the finalization of the contract and the fulfillment of necessary guarantees and insurance requirements. This latest win follows a series of recent contract awards and expansions for Afcon, particularly in the fields of electricity, substations, and infrastructure.

Last week, Afcon received additional work from Israel Railways worth about NIS 100 million, increasing the total value of that project from NIS 460 million to NIS 560 million. Earlier, another Afcon subsidiary won a NIS 36 million contract for a substation for a government company. The company is also expanding its involvement in data center projects, having secured NIS 49 million in early September for air conditioning work in a facility with a capacity of 40 megawatts of IT load.

Further bolstering its prospects, Afcon was recently selected, along with other entities, to compete for government-tendered substation construction projects. The total scope for all bidders is estimated at NIS 690 million over the next two years, with an option for an additional two years and an increase to NIS 1.38 billion. Afcon will compete for each substation individually within this framework.

Afcon's CFO, Ron Miller, previously highlighted substations and data centers as key growth areas, noting strong demand from both IEC and private entities, especially for data center developments requiring dedicated substations. The company was concurrently building ten substations for various clients. Group CEO Dudi Reali also identified this sector as crucial, anticipating increased demand due to rising electricity consumption and data center growth, and has previously stated Afcon's involvement in constructing multiple substations, including for Israel Railways.