China's Security Enterprise Competition Has Rised to Capital Competition

In the era of analog video surveillance, the market for international video surveillance companies has an absolute right to speak, but with the advent of IP, network video surveillance era, users are no longer just video surveillance products, and domestic manufacturers can better understand the market demand The advantages of more flexible market strategies are reflected and the strength is gradually enhanced. Among domestic domestic enterprises in China, there are more than 100 domestic security companies with an annual output value of over 100 million yuan. At the same time, as China encourages the introduction of the SME listing policy, the security industry has created a wave of listings. The competition of China's security companies has risen from purely technical, product, and market competition to capital competition.

In July 2005, China Security Technology Co., Ltd. (CSST) acquired Shenzhen Jiuding Group and landed on the Nasdaq OTCBB market. In the following years, CSST set off a frenzy of mergers and acquisitions in China's security industry. It has acquired more than 40 excellent security companies and formed a complete line of security product manufacturing, sales channels, software and system development, engineering integration, and operational services. The business chain has initially formed a relatively complete large security industrial chain, and has the ability to design and implement a total digital city construction solution.

In 2008, Dahua Technology Co., Ltd. and Dali Technology Co., Ltd. were listed successively. In the following years, companies such as Tongzhou Electronics, Hikvision, Dasci Intelligent, Infinova, Anjubao and Diwei Video were also listed successively, and there were more than 20 companies. Domestic and foreign listed companies include security as one of their main businesses. The listing raised sufficient funds for domestic security companies, provided sufficient financial support for the company's strategic planning and scale expansion, and also greatly enhanced the company's market competitiveness. For example, Hikvision has raised more than 30 billion yuan of proceeds from listing, and on December 29, 2010, Hikvision's market value was as high as 45.4 billion yuan, making it the fifth-largest listed company in terms of market value. According to Hikvision's first quarterly report in 2011, Hikvision's total operating income for the first quarter was approximately 930 million yuan, an increase of 35.3% over the same period last year. Abundant funds have created a relaxed development space for Hikvision's strategic planning. Hikvision has used the funds raised for production line construction to achieve significant expansion of its production capacity. If the smooth production in 2012, DVR capacity will grow to 3.8 times now, surveillance camera capacity will grow to 12.4 times now. At the same time, Hikvision invested 411.26 million yuan in a new building with an area of ​​63,389.76 square meters on ground and a corporate headquarters office building with a floor area of ​​36,436.95 square meters. By the end of 2010, the number of employees was close to 4,000, an increase of nearly 2% compared to the beginning of 2009. Times. In early 2011, Hikvision purchased a storage company, an alarm service company in China, and achieved strategic cooperation with a chip R&D company to develop SOC chip products and prepared for further adjustment of the company's strategy. .

A good industrial development environment has made the security industry in China have achieved rapid development in the past 10 years, and the industry has maintained an annual growth rate of more than 25%. At present, there are more than 20,000 companies in the security industry in China and nearly a million employees. In 2000, the output value of China's security was only 25 billion yuan. In 2005, the output value exceeded 90 billion yuan. In 2006, the output value reached 118 billion yuan. In 2007, it continued to grow at a high rate of 145 billion on the basis of 2006. By 2010, the output value of our security has reached 200 billion yuan.

The driving forces for the continued development of China's security industry in the future are mainly reflected in four areas: the expansion of security applications, the explosive growth of HD surveillance needs, the intensification of the capitalization of security companies, and the national strategy of the Internet of Things for security, security, and guidance for the Twelfth Five-Year Plan. The tilt of the industrial policy toward the security industry and the increasing attention and support from local governments to local security companies.

The National Twelfth Five-Year Plan proposes to vigorously develop the Internet of Things cities with digital cities and smart cities as the core. In the construction of Internet of Things cities with digital cities and smart cities as the core, the security system is the core application system. The projects of digital cities under construction or already built include security monitoring systems such as Pingan City's video surveillance system, intelligent transportation system, smart home system, smart community system, digital city management system, city card system, and many other security subsystems.

This will inject new impetus into the development of China's video surveillance industry. Domestic video surveillance companies have been keenly aware of the hidden business opportunities and successfully seized the opportunity. Such as CSST China Security Technology Company, from the beginning of 2007 began to layout the construction and operation of digital cities. In 2008-2009, it took two years to complete the Kunming Digital City project with a total value of 210 million yuan. In 2010, CSST achieved a digital city project with a total value of more than RMB 5 billion. In 2011, only one project in Nanjing Smart City brought a construction contract of RMB 3.8 billion to CSST. The annual project contract is expected to exceed RMB 7 billion. Hikvision won the 5 billion yuan contract for the Chongqing Municipal Social Public Video Information Management System project, the largest Internet of Things project in Chongqing.

The construction of China's Internet of Things city will bring much room for market growth for the development of China's security industry. At present, we cannot make accurate judgments. However, from 2004, the National Safe City Construction and the Construction of Science and Technology Strong Police Demonstration City to the video surveillance industry and As far as the promotion of other security subdivision industries is concerned, the huge promotion of the video surveillance industry by the construction of the Internet of Things industry is far from being revealed.

In 2011, it was the first year of the 12th five-year plan for China. China's security industry authorities in the “Twelfth Five-Year Plan for Development of China’s Security Industry” (2011-2015) proposed that during the 12th Five-Year Plan period, the development goal of China’s security industry is to achieve the scale of the industry by the end of the “Twelfth Five-Year Plan” period. Fan. The annual growth rate is about 20%. In 2015, the total output value reached 500 billion yuan, and the added value was 160 billion yuan. The annual export delivery value reached 60 billion yuan or more. Industrial restructuring has achieved initial success. The proportion of security operations and various service industries has reached more than 20%. I think this is a very pragmatic development goal and it will surely be realized!

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