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Borch builds new factory, eyes export growth, IPO

By: Steve Toloken

October 15, 2013

Chinese injection press maker Borch Machinery Co. Ltd. is building a new factory in Shandong province to substantially expand capacity, as it targets growth in exports and eyes a public stock offering.

Guangzhou-based Borch said it has opened a 20,000 square meter press assembly plant in Liaocheng, Shandong, and believes the facility could eventually triple in size, which would make it larger than its Guangzhou headquarters factory.

The company is one of China's largest injection molding machine makers, with annual sales of about 1 billion Chinese yuan ($163.8 million), roughly triple what it had six years ago. Liaocheng is its third factory, after Guangzhou and Hangzhou in Zhejiang province.

President Borch Zhu declined to offer more details on the new factory but said that facility will help it grow its exports from the 35 percent of sales now, to a target of more than 50 percent in three years, including a focus on the United States and Europe.

The manager of Borch's overseas business department, Emily Ma, said the company saw a "huge opportunity" in developed markets, as companies seek to re-invest but look for cost-effective machines.

Borch manufactures 4,000 to 5,000 injection molding machines a year, and has more than 600 employees.

In an early October interview in his Guangzhou office, Zhu confirmed that the company is still planning an initial public offering at one of the exchanges in China, but the plans have been delayed.

In 2010, the firm said it had hoped to complete its IPO in two to three years, but Zhu said that the timing of IPOs in China is determined by the exchanges, not the companies. Still, he said the process of preparing for it is helping the company.

"If we make the IPO successfully, it will be important for the company because to be public you have to improve everything," he said. "But the most important thing is the company should make itself better."

The company has a number of focuses for future development, he said, including automation, two-platen machines, multi-color and multi-component machines and all-electrics.

The company is also building what it says is the largest injection molding machine made in Asia, a 6,000 ton press for a pipe and fittings manufacturer in Shandong. The machine, with a 300-kilogram shot capacity, is being built in its factories in Guangzhou and Hangzhou and assembled at the customer's facility, Zhu said.

Borch was participating at its second K show. At its K show booth (Hall 13, C47), it was showing a 900 ton two-platen model in its BU series.

The company believes it has price/performance advantages in the two-platen market against European companies, which traditionally dominate that sector, said Ma.

"Before the two-platen technology was all from Europe," she said. "But in Europe the design cost is very high. Now, our technology can compete but our machine cost is not as high."