Honeywell International Inc.‘s (HON) group company, UOPLLC, will help China’s Shandong Chambroad Petrochemicals Co. to produce key petrochemicals through its UOP C3 -and C4 Oleflex(TM) processes. This is the first plant in China which combines the two processes to produce propylene, and second in the world to produce isobutylene.
In 2014, the new unit is expected to start production. The units will produce 133,000 metric tons of propylene and 87,000 metric tons of isobutylene annually. The production facility is located in Binzhou City, Shandong Province, China.
Propylene is the main ingredient for producing films and packaging and isobutylene is for fuels and synthetic rubber. Engineering design, technology licensing, catalysts, adsorbents, equipment, staff training and technical service will be provided by Honeywell’s UOP.
More than 15% of worldwide demand for propylene is from China and the company expects it to rise by 5% to 6% in 2012.
For further expansion, the company is focused on growth factors such as investments in new products, technology demarcation, expansion in the emerging markets and initiatives in key processes. Honeywell’s short-cycle businesses, as well as its commercial aerospace spares and residential and commercial retrofit businesses, are performing impressively well and are expected to support the company’s future growth outlook.
However, a change in the U.S. government’s defense and aerospace funding could adversely impact sales of Aerospace’s defense and space-related products and services.
Based in Morris Township, N.J., Honeywell International Inc. is a Fortune 100 company providing technical and manufacturing support to customers worldwide with aerospace products and services; control technologies for buildings, homes and industry; automotive products; turbochargers; and specialty materials. The major competitors of Honeywell are BorgWarner Inc. (BWA), United Technologies Corp. (UTX) and Johnson Controls Inc. (JCI).
We currently maintain our Outperform rating on Honeywell, corresponding with a Zacks #1 Rank (Strong Buy recommendation) over the next one-to-three months.
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