Steel Firms Fall Behind to Retail in Industry Ranking
Published By : 29 Oct 2014 | Published By : QYRESEARCH
The Sunday release by the China Non-government Enterprise League exhibited statistics of the private-sector steel producers that fell out of the leading 10 positions on 500 private companies list after being affected by the weakening domestic demand.
Shandong Weiqiao Pioneering Group Co Ltd, Legend Holdings Ltd, and Suning Appliance Co Ltd were ranked among the top three contenders of the list. The entire list is consolidated by the league and two other statistics and management institutions.
Retailers consumed two spots among the top 10 companies and so did the information technology industry. Other three petroleum and chemical companies, namely, CEFC China Energy Co Ltd, Xinjiang Guanghui Industry Investment Group Co Ltd, and Hengli Group also consumed the top 10 places.
However, Jiangsu-based Shagang Group Corp held higher revenue than CEFC China Energy. It fell out of the top 10 marking worth 228 billion yuan revenue in 2013.
All these numbers do not indicate any financial performance. According to a senior analyst at Mysteel, Xu Xiangchun, different lists are compiled using variable standards.
With a major focus on smelting, metal refining, construction, and electronic equipment most of the companies on the list still belong to the manufacturing sector.
Even though top companies were absent such as, Rizhao Iron and Steel Group Co Ltd and Shagang, 11 metal refining companies in the list of top 50 were listed this year and last year. Shagang was the first among the private-sector steel companies and fifth on that list.
In the recent years, many privately owned steel companies have faced downstream demand on reducing prices. They have to deal with different government policies to stir smaller producers out of the overcapacity and businesses.
On the other hand, large state-owned steel companies have local government subsidies, whereas private sectors have higher costs to face.
Companies like Shagang have their non-steel revenue planned to reach 100 billion yuan by 2015, said president Shen Wenrong of Shagang. The company also has its non-steel businesses on expansion to survive in the market.
Head of the China Metallurgical Industry Planning and Research Institute Mergers - Li Xinchuang said mergers and acquisitions are one of the ways for privately-owned companies to adopt their own paths during bad times.