The SRG Global (ASX: SRG) share price has more than doubled, this year, to just over $2.90. Two astute acquisitions, a solid 2025 financial year result , and a steady stream of contracts won over a diverse range of sectors, have all supported positive sentiment around SRG Global shares. It is clearly a much better-known stock now, than it was when I first covered it more than two years ago.
As I will discuss below, at a high level, the thesis remains similar, with the business gradually improving its resilience and revenue reliability.
Nowadays, SRG Global has increasingly diversified operations and increased capabilities, so it should come onto the radar of more investors, including fund managers. In saying that, the forward Price to Earnings (P/E) ratio of ~21 times earnings is priced for future growth, so clearly sentiment has improved over the last couple of years.
In light of a few recent developments, a subscriber of A Rich Life asked for an update on the business, so here it is.
Editor’s note: I asked Chris to take this one since, in my view, he’s done a better job covering with SRG Global than I have!
SRG Global (ASX: SRG) acquires TAMS Ltd
In October, SRG Global acquired port and marine infrastructure services business TAMS Ltd. TAMS was acquired for $85 million. SRG Global used $57 million in existing cash and debt facilities, plus $27.7 million of SRG Global shares were issued to Vendors (13,948,705 SRG Global shares at $1.99 per share), which will be escrowed for two years. Post acquisition SRG Global still retains a solid balance sheet with a gearing ratio of 0.3 times Net Debt to FY26 EBITDA.
TAMS provides end-to-end services from engineering through to remediation of port and marine infrastructure. TAMS was purchased for a reasonable 2.7 times FY26 EBITDA and 3.2 times EBIT. TAMS has a foothold in many critical ports around Australia, including Port Hedland, Fremantle and Gladstone. This gives SRG Global scope to sell its services to these blue-chip clients at their inland bases.
The acquisition fits with management’s goal of moving to a more recurring revenue style. 90% of TAMS revenue is from multi-year contracts, moving SRG Global’s recurring style contracts to around 80% of total revenue. TAMS is also capital light with capital expenditure 2-3% of revenue. The acquisition is expected to lift EBIT(A) margins from 7.2% to 8.2%, which is good news given the thin margins in the industrial contracting industry.
Investors were happy with the acquisition, sending the share price up 30% on the day.
SRG Global (ASX: SRG) secures more contracts
In late November 2025, SRG Global announced contract wins worth $650 million across water, energy, defense, health, education, and industrial sectors. This continues the pattern of winning new and further work with existing clients and increasing capabilities.
Two of the contracts are for five years. One with Wesfarmers Chemical to provide shutdown maintenance services, and one with Alcoa to provide multi-disciplinary maintenance services. There is also a seven-year term contract with South32 to provide specialist maintenance services at its Worsley Alumina operations. This provides some earnings predictability and aligns management’s focus on recurring style maintenance revenue.
The chart below shows the total value of secured contracts and the number of sectors covered, per announcement, since the start of 2024. As you can see, SRG Global has been announcing larger contracts over an increased number of sectors throughout the last couple of years.
Water Infrastructure
With Australia’s increasing population putting pressure on aging water infrastructure, and leading to increased pollution, water security should become more of an issue. Water services business Diona, which was acquired in August 2024, gives SRG Global some exposure to this theme.
In the latest company announcement in November, two water contracts were secured for the design and construction of concrete tanks for the Alkimos Desalination Plant Project in Perth. Desalination is turning salt water into drinkable water, and the Alimos plant aims to produce 50 billion liters of water annually once operational.
Also secured was a water infrastructure contract with Byron Shire Council for flood resilience works, including upgrades to stormwater drainage in Byron Bay (Northern NSW). Global warming is increasing the number of floods and droughts in Australia, especially in hotter areas like Queensland, so we may see SRG Global gain more contracts of this nature.
Short-term outlook for SRG Global shares
The share price has surged as investors digested the latest acquisition (which comes hot on the heels of the previous acquisition of water services business, Diona, which investors also cheered.) As a result, SRG Global’s trailing Price to Earnings (P/E) of ~21 times forward earnings is certainly pricing SRG Global shares for future growth. The share price rise has also seen the dividend yield decline markedly to be currently around 2%. This is simply not as attractive as it has been in the past.
The bigger company and increased workload, from two acquisitions in the past two years and a slew of contracts won, could see management tested. On the other hand, so far they have executed successfully on their strategy of transforming from a cyclical project contractor to a more recurring style of maintenance business with more capabilities.
But with more optimism in the share price right now, the short-term outlook could see a moderation as animal spirits die down.
Long-term outlook for SRG Global Shares
SRG is increasing capabilities and moving towards more recurring style maintenance revenue whilst diversifying into new sectors like water services. This makes earnings less cyclical and more predictable. Many investors are picking up on the fact that management has made two decent acquisitions in a row. These factors may see the company gain attention from institutional investors, and possible inclusion into the larger capitalization ASX Indices in the future.
SRG Global expects FY26 EBIT(A) guidance to be at least $125 million. This is up 33% on FY25 EBIT(A) of $93.8 million, with TAMS to contribute for eight months of the financial year.
Currently I, (Christopher Coe) am holding SRG Global shares, but I would be wary of buying at the current lofty valuation for an industrial services business. In light of the recent optimism expressed by the share price rise, if I didn’t already own shares, I would resist the fear of missing out and wait for a pullback before buying.
Disclosure: The author Chris Coe owns shares in SRG will not trade shares for at least 2 business days after the publication of this article. The editor of this article Claude Walker does not own shares in SRG and also will not trade the stock for at least 2 business days after the publication of this article. This article is not intended to form the basis of an investment decision and is not a recommendation. Any statements that are advice under the law are general advice only. The author has not considered your investment objectives or personal situation. Any advice is authorised by Claude Walker (AR 1297632), Authorised Representative of Equity Story Pty Ltd (ABN 94 127 714 998) (AFSL 343937).