In a strategic move aimed at strengthening its presence in the food security sector, Naqi Water Company announced the signing of an addendum to a contract that includes the execution of vital construction work to increase production capacity at its ambitious poultry farm project. This step reaffirms the company's commitment to its well-considered expansion plans and diversification of revenue streams.
According to the official statement issued by the company and published on the Saudi Stock Exchange (Tadawul) website, the new contract addendum focuses primarily on adding two new production sheds to the existing project. This expansion is expected to have a direct and tangible impact on operations, contributing to an increase in the project's production capacity by up to 50%, thus enhancing the company's ability to meet growing demand in the local market.
Investment details and costs
The company clarified in its statement that the total value of the additional contract addendum is SAR 3,659,838 (excluding VAT). This cost covers the integrated construction works, which include the implementation and preparation of the necessary infrastructure, as well as the construction of the structures and buildings designated for the two new hangars, within the scope of the approved construction works for the entire project.
The context of food security and the Kingdom's vision
This step takes on particular significance when viewed within the context of Saudi Arabia's macroeconomy. The poultry sector is a cornerstone of the Kingdom's food security strategy under Vision 2030. National companies, such as Naqi, are striving to align with government initiatives aimed at increasing self-sufficiency in poultry products and reducing reliance on imports, making investment in expanding the sector's infrastructure a strategic and economically viable long-term option.
Company economic diversification
This expansion demonstrates the success of Naqi's strategy to diversify its investment portfolio and not rely solely on the bottled water sector. The company's strong entry into the poultry sector and expansion of production capacity reflects its desire to enhance operational efficiency and distribute investment risks, which will positively impact shareholder equity and the company's market position.
The company concluded its announcement by noting that the costs mentioned are currently limited to the construction work included in the contract addendum, indicating that there are other obligations related to the expansion process that will be disclosed in due course in accordance with the regulations and rules applicable in the financial market.
