Markets
GE

ABB to Double New Fibria Plant's Capacity, Shares Up 2%

ABB Ltd.ABB has been selected by the leading eucalyptus pulp manufacturer Fibria to provide "electrification, automation and optimization" equipment for the latter's new pulp mill in Brazil's Mato Grosso do Sul. Probably led by this development, the company's shares rose almost 2% during the regular trading session on Oct 2.

Helped by ABB's solutions, Fibria expects to increase the capacity of its Três Lagoas Mill twofold, and produce 1.75 million tons of extra pulp annually. This new pulp mill, part of Fibria's ongoing project Horizonte 2, aims at expanding the capacity of Três Lagoas Mill. The latter happens to be one of the largest pulp production plants in the world.

Fibria expects the new plant to be operational from 2017. The company plans to deploy ABB's integrated electrification and automation offerings in most of its processes, for both existing and new mills. Moreover, ABB's asset optimization system will provide data support for engineering activities, so as to drive maximum excellence at the plants.

ABB believes its smart power and automation solutions will act as perfect precursors for industries to embrace the Internet of Things (IoT), Services and People networks. The company's offerings will enable clients to use a solitary control system for multiple plants, thereby enhancing their production capacities.

ABB, currently one of the strongest power and automation companies of the world, also boasts one of the best managed industrial infrastructures. Growth in the company's process automation business is primarily attributable to factors like adoption of IoT, machine to machine (M2M) communication technology and surge in demand for robotic equipment in the industrial sector.

Research reports from Markets and Markets suggest that industrial control and factory automation market will be worth $202.42 billion by 2020. This is because business enterprises, in their attempt to drive automation, enhance efficiency and slash costs, is continually striving to improve upon the conventional manufacturing processes.

However, ABB faces stiff competition from players like Honeywell International Inc. HON , Emerson Electric EMR and General Electric Company GE in this space. Also, volatility in the oil and gas prices has been severely impacting the company's Process Automation segment. This apart, negative effect of foreign exchange translations and slowdown in some of its key markets like China are adding to this Zacks Rank #3 (Hold) stock's woes.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days . Click to get this free report >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

ABB LTD-ADR (ABB): Free Stock Analysis Report

HONEYWELL INTL (HON): Free Stock Analysis Report

EMERSON ELEC CO (EMR): Free Stock Analysis Report

GENL ELECTRIC (GE): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

GE HON ABB EMR

Other Topics

Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More