Pipe extruder Liansu plans more expansion in China

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: August 21, 2012 6:00 am ET

Related to this story

Topics Construction, Pipe/Profile/Tubing

HONG KONG (Aug. 21, 1:50 p.m. ET) — China Liansu Group Holdings Ltd., the country’s largest plastic pipe maker, plans a significant expansion to meet growing domestic demand, with new factories slated for Hainan, Yunnan, Shandong and Guangdong provinces.

Liansu disclosed the investments in an earnings report filed August 20 with the Hong Kong stock market, where it said that sales increased 5.6 percent in the first half of the year, to 4.81 billion Chinese yuan (US$726.2 million), while profit was up 11.6 percent, to 598 million Chinese yuan (US$94.0 million).

That’s actually significantly slower sales growth than the 31 percent the firm saw in 2011, a result of tougher conditions in China this year and the government’s decision last year to tighten credit and slow the housing market.

But the company said overall prospects for plastic pipe remain good, pushed by China’s general trends toward increased urbanization, construction of affordable housing, investments in water conservation and revamping of outdated pipe networks.

Liansu, based in Foshan, Guangdong province, did not provide details of the additional expansion in its filing but said the four facilities are part of a “new phase of capacity expansion… to ensure that the market demands are being met.”

The company said it expects to have production capacity between 1.65 million and 1.75 million metric tons by the end of the year. In recent years it has been expanding heavily beyond its base in Guangdong.

“Stable growth in the demand for plastic pipes is still expected given further advancement of China’s industrialisation, urbanisation and informatisation, further expansion of domestic demand and ongoing implementation of major construction projects in affordable housing, urban infrastructure and new agricultural villages,” the company said. “The Group is fully confident that it will enjoy sound and stable business development in the second half of 2012.”

The company said it was able to maintain profit growth in spite of the sales slowdown because it maintained cost controls, adopted an “optimized” pricing strategy and attracted new customers.

The volume of pipe and fittings sold rose 9.1 percent in the first half of the year, compared to the same period in 2011, to 470,000 metric tons, even as average selling prices fell, Liansu said.

Other focuses for the immediate period include expanding its national sales network and trying to better tap international markets, along with continuing to diversify into related plastic construction products such as plastic-steel doors and windows and kitchen and sanitary products, the company said.


Comments

Pipe extruder Liansu plans more expansion in China

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: August 21, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Residents ask court to close pipe maker

November 21, 2014 3:22 pm ET

Residents living by National Pipe & Plastics Inc.'s new factory in an industrial zone of Endicott, N.Y., say the facility has “devastated the...    More

Image

Interest in green building growing

November 14, 2014 1:14 pm ET

Interest in third-party certification for green buildings continues to climb, with 62 percent of respondents to a biennial survey by an international ...    More

Market Reports

Plastics in Brazil - State of the Industry Report

This in-depth report examines the Brazilian plastics industry from a historical and geographical context. Our analysts provide insight on economic trends and forecasts, growing manufacturing sectors that utilize plastics, private investment opportunities, market environment challenges, and innovations in R&D.

Data tables and charts on producer prices, trade, plastics production and end market indicators is also included.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molders Market Report & Ranking 2014

This special package contains our 132-page 2014 Market Report on the Injection Molding segment and our exclusive 2014 RANKINGS database of 500+ Injection Molders for a discounted package price.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

October 27, 2015 - October 29, 2015Plastics Financial Summit - New York - 2015

More Events