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AsiaToday reporter Choi Sung-rok = There is much attention towards the revival of Doosan Group, who suffered from liquidity crisis last year. Doosan Group plans to eliminate darkness over the group with so-called 'three big positive signs', that are improved performance of affiliates, successful restructuring and financial structure improvement, and positive changes in external factors.
According to the industry on the 27th, Doosan Group's affiliates are expected to get over slump this year.
First, its main affiliate Doosan Heavy Industries & Construction will be participating in a project to build a 2.5 GW offshore wind farm off the southwest coast of the Korean peninsula along with Hyundai Heavy Industries and Samsung Heavy Industries.
Doosan Infracore is showing a speedy recovery as well. Doosan Infracore sold 839 excavators in China last month, a rapid increase of 82 percent year-on-year. Its market share is 9.3%.
If Doosan Infracore increases its market share up to more than 10 percent, it can be a big influence in the Chinese market. As the company suffered losses for the past two years, its recovery of market share can directly lead to improvement of sales performance.
The non-construction business units of Doosan Construction, which suffered from liquidity crisis recently, are showing good performance. Doosan Construction's housing division occupied 71.8% in total sales of the company in 2010 but is expected to decrease to 24.2% by 2016. Its HRSG (heat recovery steam generator) unit and Mecatec business will fill those positions and are expected to grow more than 100% this year.
The market sees Doosan Group's financial structure improvement as positive.
Kyobo Securities said, "Doosan Group's affiliates which acted as an obstacle, are expected lighten the burden through financial restructuring. Doosan Group's debt ratio improved significantly from 366% at the end of third quarter to 244% by the end of last year."
Another positive sign is that the uncertain nuclear power plant business issues are settled.
The government has set the target ratio of nuclear power generation in total by the year 2035 at 29 percent, according to the second national energy plan announced. Doosan Babcock, an European subsidiary of Doosan Heavy Industries & Construction, signed a contract with EDF Energy to provide operational services for fourteen nuclear reactors in the U.K over the next 17 years. Three years of nuclear power plant management services is expected to value as much as 450 billion won.
