Praxair Inc. (PX) recently named president of Praxair Electronics Anne Roby, as the president of the company’s Asian operations. She will be responsible for developing the company’s businesses in China, India, South Korea, and Thailand. Additionally, growth of the electronics business in Asia, Europe and North America will be her responsibility.

Appointment of Anne Roby as the president of Asian operations is very encouraging, especially in the light of her commendable performance and proven leadership qualities in Praxair after she joined the company in 1991.

The Asian operations of Praxair are concentrated chiefly in China, Korea, India and Thailand, with approximately 35 of the production facilities being cryogenic air separation plants, while noncryogenic air separation, carbon dioxide, hydrogen, packaged gas and other production facilities can be found throughout Asia.

The Asian businesses accounted for roughly 12% of the company’s total revenue in the fourth quarter of 2010. Sales in the quarter increased12.4% year over year and 7.3% sequentially to $308.0 million, mainly attributable to new plant start-ups and merchant growth in China, India and Korea.

We believe Praxair has significant growth opportunities in diverse markets and its concerted effort in increasing exposure and tapping opportunities in emerging markets is also very encouraging. Moreover, the growth prospects of industrial gas producers are very bright with demand for gases ever rising due to their wide application areas, including chemical processing and petroleum refining, metal production and fabricating, and electronics and health care industries.

However, excessive dependence on international revenue and energy costs, both volatile in nature, is risky. The company also operates in a highly-competitive environment, which may adversely affect top-line results. It faces stiff competition from peers like Air Products and Chemicals Inc. (APD) and Airgas Inc. (ARG).

We currently maintain a Neutral recommendation on the stock.

 
AIR PRODS & CHE (APD): Free Stock Analysis Report
 
AIRGAS INC (ARG): Free Stock Analysis Report
 
PRAXAIR INC (PX): Free Stock Analysis Report
 
Zacks Investment Research