Sany Group Growth Pared as China Slowdown Cuts Machinery Demand
Sales may exceed 100 billion yuan ($16 billion) in 2012, up from 80 billion yuan a year earlier and more than 50 billion yuan in 2010, Xiang Wenbo, executive director of the company based in Changsha, Hunan province, told reporters in Beijing today. Sany Group controls Sany Heavy Industry Co. (600031), whose shares are traded in Shanghai, and assets including a wind-turbine manufacturing business.
The government this week trimmed its growth target for the world’s second-largest economy to 7.5 percent from the 8 percent in place since 2005. China will still encourage infrastructure investment in western areas, the official Xinhua News Agency reported on March 7, citing Premier Wen Jiabao.
“The industry’s extraordinary growth, brought about by the government’s stimulus package, is not sustainable,” Xiang said. “Still, the Chinese market will be the best in the world,” he said.
Sany Heavy last year pulled out of a $3.3 billion share sale in Hong Kong as the market slumped. Xiang declined to comment today on when the company will revive the plan.
Sany Heavy said last month it agreed to set up a 900 million-yuan venture in China with Palfinger AG (PAL), the world’s biggest maker of truck-mounted cranes. The company also announced a 360 million-euro acquisition of concrete-pump maker Putzmeister Holding GmbH with a partner earlier this year, as Chinese construction-equipment makers seek to challenge Caterpillar Inc. (CAT) and Komatsu Ltd. (6301) internationally.
China’s government plans to boost fixed-asset investment by 16 percent this year, the National Development and Reform Commission said on March 5, below the 18 percent median of 12 economists’ estimates compiled by Bloomberg.
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