Doosan Targets Top 5 Status and $17 Billion in Revenues in 2007

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Researched by Industrial Info Resources (Sugar Land, Texas). Doosan (Seoul, South Korea) and its affiliate Doosan Heavy Industries and Construction are expanding the scope of overseas investments in 2007 by 70% to $1.6 billion as part of a strategic target of moving into the ranks of the top five global infrastructure support sector.

Doosan Heavy Industries and Construction is planning to move into the nuclear power generator market in the U.S., Europe and China through Doosan Babcok Energy, Limited. Doosan Infracore will continue to expand its plants for the manufacturing of machine tools in China and explore new markets in India and Brazil. Looking at the Indian mega-power projects, Doosan has joined a consortium with Tata Power and Siemens and is actively pursuing the multibillion dollar bids. Since the 1960s, Doosan has installed over 130,000 megawatts of power generation plants in local and global markets.

The aim is to achieve and maintain a premier position in the E+P+C (engineering, procurement and construction) field in the Middle East. Power generation and desalination plants moved ahead in the region in late 2006 with a contract with Suez Energy International for the construction of an IWPP (Independent Water and Power Producer) in Barka Phase 11 in Oman, which includes a 678-megawatts (MW) power plant and a 120,000 tons per day desalination plant. The construction of the A10 combined cycle 216 MW power plant in Al Taweelah for the same company will be operational by May 2009. In 2007, the company is positioned to target $6 billion worth of power and desalination projects up for bidding in the region.

Work will begin this year on a plant at Dung Quat in Vietnam that is scheduled to start commercial operation in 2009 with the manufacturing of desalination and heat generation equipment. The group also has plans to acquire companies with innovative technologies and make investments in the development of new model excavators and integrated gasification combined cycle power technology.

Doosan estimates revenues of $17 billion in 2007 with profits of $1.4 billion. The company will hire 1,000 new employees showing an increase of 40% over 2006. 2006 turnover is estimated at $15 billion with a profit of $1.1 billion.

In China, which the country identifies as a ‘second home market’, the plan is to reach over $3.1 billion in revenues by 2010 and an operating profit of over $1 billion. In 1994, Doosan Infracore (then part of Daewoo) established production subsidiaries for excavators and machine tools in Shandong Province. These plants had revenues of $390 million in 2005 and are expected to boost this by 40% with $550 million in 2006.

Doosan Heavy Industries, Doosan Infracore and seventeen other subsidiaries will all be grouped under the ‘Doosan’ identity and a new brand management system will be installed to elevate the image and strengthen the brand influence. Core parts manufacturing will be expanded in China and part and materials procurement will be integrated to cover operations in Korea and China to help meet the rapidly rising demand for basic parts.

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