The Pointerra Ltd (ASX: 3DP) share price is having a sensational finish to the week.
At one stage today, the ASX tech share was up almost 120% to 21 cents.
The 3D geospatial data technology company's shares have eased back since then but remain up a solid 67% to 16 cents currently.
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Why is this ASX tech share skyrocketing?
Investors have been scrambling to buy Pointerra's shares after it announced a major contract win.
According to the release, the company's existing customer, Entergy Corp (NYSE: ETR), has selected Pointerra's US Engineer, Procure & Construct (EPC) partners for its 10-year, US$15 billion grid resilience CAPEX Program.
Entergy is a US$21.9 billion (A$32.7 billion) Fortune 500 company that provides power to 3 million customers throughout Arkansas, Louisiana, Mississippi and Texas. The release notes that the Louisiana-based energy utility company plans to spend US$15 billion on an electric grid resilience CAPEX program.
The company's Pointerra3D product will be used to process and analyse 3D LiDAR and 2D imagery to build a digital twin of Entergy's electricity network. This will then allow Entergy and its EPC contractors to use Pointerra3D's world-first quick load electric grid assessment tools to rapidly assess and prioritise the works to be completed in the most cost-effective and efficient manner possible.
Over the term of the program, the ASX tech share will be paid a price per pole/structure inspected and analysed using Pointerra3D.
At present, the company expects that up to 4 million poles could be inspected and analysed using Pointerra3D during this time.
And while a rate has not been finalised for this program, management expects it to be similar to previous rates of between US$20 and $40 per pole. This suggests that the contract could be worth US$80 million to US$160 million over its life, with revenue expected to commence during FY 2024.
