Analysis of Listed Chlor-Alkali Companies
               Liang Jianmin, Zhong Zeyang
1. General status of the chlor-alkali sector
China has  more  than  220  chlor- alkali  producers.   The
production capacity of caustic soda is around 5.8  million
t/a. The output was 5. 3  million  tons,   the  production
-marketing ratio was 97%, the export amount was 230 000 tons,
the import  amount  was  30  000  tons  and  the  domestic
consumption was nearly 5 million  tons  in  1997.   It  is
expected that the output will be 5.3 million tons and  the
consumption will be 5  million  tons  in  1998,   and  the
balance will be bridged by export.  The  biggest  chlorine
-consuming product is PVC. China has 74 PVC producers  with
a total production capacity of 2 million t/a.  The  output
was 1.502 million tons in 1997, a rise of 8. 1%  over  the
previous year. The domestic output still can not meet  the
demand. The import amount was 1.177 million tons  and  the
export amount was 50 000 tons in  1997,   the  net  import
amount being 1.126 million tons, a rise of 35.7% over  the
previous year.
2. General status of listed chlor-alkali companies
There are 19 chlor-alkali enterprises  listed  on  Shenzhen
and  Shanghai  stock  markets.   The  total  caustic  soda
capacity of these enterprises reaches 1.908  million  t/a,
accounting for one-third of the national total. To make  a
  scientific  analysis  and  comparison,   we  can  roughly
classify these enterprises into three groups.   The  first
group refers to companies who are mainly based on  caustic
soda, PVC  and  other  chlorine  products.   They  include
Shanghai Chlor-alkali Chemical, Shenyang Chemical, Beijing
Huaer, Jinhua Chlor-alkali  Cangzhou Chemical  Industrial,
Jiangsu Suopu  Chemical Group,  Sichuan  Jinlu  Group  and
Xinjiang Tianye Chlor-alkali Co., Ltd.. The  second  group
refers to companies whose chlor-alkali production is  only
part of the overall business. They include  Tianjin  Bohai
Chemical, Qilu Petrochemical  Corporation,   Juhua  Group,
Jilin Chemical Industrial  Corporation,   Huanghe  No.   4
Chemical Plant, Mudanjiang Petrochemical  Corporation  and
Emei Group. The third  group  refers  to  companies  whose
chlorine products are  mainly  pesticides.   They  include
Shandong Pesticide, Salonda Group and Fujian Sannong Group
Co., Ltd.   Besides,   the  parent  company  of  Xianglong
Electric Industrial Co., Ltd.   is  Wuhan  Gehua  Chemical
Industrial Group  Corporation.   There  are  reports  that
Xianglong will acquire Chlor-alkali Plant  of  its  parent
company with the funds collected from the stock market.
3. Analysis of listed chlor-alkali companies
(1) chlorine products
As can be seen from Table 1,   most  of  the  listed  chlor
-alkali companies produce PVC. PVC  is  one  of  the  major
chlorine products in China's  chlor- alkali  sector.   The
domestic output and the import and export trade prove that
there is a great shortage of PVC  in  China.   The  import
amount was more than 1 million tons in 1997.  Due  to  the
supply shortage, PVC has become one of  the  major  profit
- making  products  of  chlor- alkali  enterprises.     The
production capacity and process of PVC has a great  impact
  on  their  economic  performance.   Listed  chlor- alkali
companies with a large  PVC  production  capacity  include
  Shanghai  Chlor- alkali  Chemical  Co. ,   Ltd. ,    Qilu
Petrochemical Corporation, Beijing Huaer Co.,   Ltd.   and
Tianjin Bohai Chemical Co., Ltd.. China mainly adopts  the
  calcium  carbide  acetylene  process  and  the   ethylene
oxychlorination process in PVC production. Around  90%  of
  PVC  in  the  world   is   produced   by   the   ethylene
oxychlorination process. Most  of  domestic  chlor- alkali
enterprises use the  calcium  carbide  acetylene  process.
Only  a  few  companies  such  as  Shanghai  Chlor- alkali
Chemical Co.,   Ltd. ,   Qilu  Petrochemical  Corporation,
Beijing Huaer,   Dagu  Chemical  Plant  of  Tianjin  Bohai
Chemical Co., Ltd. and Jinhua Chlor-alkali Co., Ltd.   use
the ethylene oxychlorination process.
Shanghai Chlor-alkali Chemical Co., Ltd., Shenyang Chemical
Co., Ltd. , Jinhua Chlor-alkali Co.,   Ltd.   and  Tianjin
Bohai Chemical Co., Ltd. have a  considerable  variety  of
  chlorine  products.   These  enterprises  can   therefore
withstand the risks caused by fluctuating market prices of
some products. Chlor-alkali Plant of Sichuan  Emei  Group,
Resin Plant of Mudanjiang  Petrochemical  Corporation  and
Huanghe No.  4  Chemical  Plant  only  have  few  chlorine
products. They would be faced with great risks in case the
caustic soda market is soft.
(2) comparison of share capital and caustic  soda  and  PVC
capacity
The share capital of the second group companies is not only
the share  capital  of  their  chlor- alkali  units,  &nbs