Reporters learned from the company that its subsidiary Jiangnan Heavy Industry Co., Ltd., a well-known manufacturer of steel structures, liquid holding tanks and full equipment range for the shipping industry, has began developing its shipbuilding support business including axis rudder systems, liquid holding tanks, hatch covers and superstructures, aiming to be China's biggest specialised shipbuilding support base within five years.

The company also aims to be the world's biggest shipbuilding group by 2015 and has began developing its non-shipbuilding business including ship repairs, ship support business and steel structures in order to complete its shipbuilding industrial chain.

Liu Jianren, General Manager of Jiangnan Heavy Industry, said that the company will focus on the supply of high quality intermediate products and services for final shipbuilding assemblers. A new production base will be constructed within a short period to improve the current lag in the support business of shipbuilding in China, which will be a new profit growth generator for Jiangnan Heavy Industry.

Qin Wenquan, General Manager of Hudong Heavy Machinery stated that risks for shipbuilding support enterprises lie in four areas including excessive capacity caused by rapid development of the industry, resource shortages caused by rapid growth in production capacity, exchange rate risks and the rise in the producer price index.

Source: China Securities Journal

Date: 30 Jun 2008

CN01/NW/MZ/BT/KM