SHANGHAI Hero Pen Co, whose shares are traded on the Shanghai stock exchange, has projected a profit after tax of 51 million yuan (about HK$45 million) for this year, up by 25.7 per cent from last year's figure. Senior company officials, led by chairman and general manager Zhao Songsheng, have just returned from a trip to Southeast Asia to promote the company following the listing of its B shares last month. Mr Zhao said the company would diversify its production capacity to establish three main product lines, including the traditional pen-making line. It would strengthen its pen business by expanding the product range and improving quality to consolidate the company's dominating role in the market, it said. It would expand into making computer drafting instruments, which it believed would have a very large market in coming years. It also planned to branch out into making kitchen appliances. The proceeds from the A and B share issues would pay for the development of these projects, said Mr Zhao. Mr Zhao said sales of pens would continue to increase, although as a proportion of total sales, the sector would decrease. The proportion of sales due to pens fell from 89 per cent of the total in 1991 to 85 per cent in 1992 and 79 per cent last year. Mr Zhao said the company's sales were 224 million yuan last year, and were expected to top 300 million yuan this year. ''Our expansion has started to bear fruit and in the coming two years, the company will see significant development. Sales in 1995 are expected to reach 450 million yuan,'' he said. Mr Zhao said China's foreign exchange reform would not affect the company because it had long adopted the swap centre exchange rates, which are determined by the market. As the company has 32.8 per cent of its share capital in B shares, it is allowed to retain foreign currency accounts with banks.