The X2M Connect Ltd (ASX: X2M) share price is set to finish the week on a strong note. This comes after the technology company announced it had won a major tender in South Korea.
At the time of writing, X2M shares are up a sizeable 37.5% to 22 cents. When factoring in today's gains, its shares have raced 42% higher this week.
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X2M continues South Korean growth
The X2M share price is taking off after the company announced it had secured a 2.3 billion Korean won (A$2.6 million) contract with Korea Water Resources Corporation.
The deal will see X2M provide its Internet of Things (IoT) platform along with devices and 12 months of remote metre monitoring fees. Before the end of the year, both companies will agree upon a new monthly software-as-a-service (SaaS) fee for ongoing monitoring.
Around 20,278 households will be fitted with remote water metre devices in Jeonju City, the southern province of Jeollabuk-do. This complements X2M's recent wins last month in which it gained two other major remote water monitoring customers.
X2M's strategy for water in South Korea is to deploy its platform across many of the South Korean districts.
So far, the new contract will only penetrate about 8.7% of the total addressable market of Jeonju City. The company is aiming to leverage the initial deployment to capture the remaining 211,750 households. The potential estimated value of this is in excess of $25 million.
Commenting on the news fuelling the X2M share price, CEO Mohan Jesudason commented:
This is another excellent result for our South Korean subsidiary. Winning a number of these tenders in quick succession shows our leadership position in this market. This also aligns with our long-term strategy to secure customers with large numbers of households that will drive future subscription revenues. This tender plus our Q1 and other contracted revenues now total $7.8 million.
About the X2M share price
Since the company listed on the ASX in late September, the X2M share price has lost 12%. The company's shares reached a high of 35 cents on the day of its debut, before treading lower.
On valuation grounds, X2M presides a market capitalisation of roughly $22.4 million.
