Security market opportunities focusing on the 2008 Beijing Olympic Games

The rapid development of China's security market.

In recent years China's rapid economic development, stimulating the social security of market demand, in 2006 the market size of China's security industry has more than 800 billion, while as the Beijing Olympic Games for the stimulation of the security industry, 2008 domestic security industry market will reach $ 184 billion yuan, the annual compound growth rate of up to 25%.

China's security industry development opportunities and challenges.

China's security industry scale rapid expansion in recent years, the formation of the Pearl River Delta, Yangtze River Delta, Bohai three security industry base, but they are mostly small security products production enterprise, lacks its own core technology and total solutions. 2008 Beijing Olympic Games, the coastal second, three-city and the key cities of the West "safe city", the World Expo 2010 Shanghai and Guangzhou Asian Games, to domestic security enterprises bring enormous opportunities, but at the same time, domestic enterprises will face strong competition from foreign peers.

Beijing Olympics gave birth to the great security requirements.

In accordance with the budget, the Olympic venues and facilities security investment will reach $ 3 billion, accounting for the Olympics overall budget of 1/5. The Olympic Games for Beijing city and its surrounding region social security needs of driving effect will have up to 20 times, about 500 billion yuan market demand. Domestic enterprises mainly in security equipment, security systems-building have certain advantages, such as overall solutions for foreign companies.

Olympic Games will be part of the formation of listed companies.

Including Peng, Gehua CATV, tongfang co., a part of the winning companies on the important Olympic security system construction project. On the one hand, these projects can give companies bring long-term or short-term economic benefits, while at the same time and the company's original business also can form cooperative. On the other hand, these projects will also be formed by Olympic demonstration effect, helping these companies seize the rapid expansion of the security market.

World Expo, games, and other long-term industry hotspot more worth looking forward to.

The 2010 World Expo, the games will bring security market demand is in no way inferior to the Olympic Games. Currently, the event is already in the preparatory phase, the majority of the projects and the device has started bidding or purchase, which will serve as a security device manufacturing dominated domestic enterprises of another enormous business opportunities.

1. domestic security industry profiles;

World Security Institute of the security industry is defined as information and communications security, industrial safety and fire protection, safety equipment, system integration and service categories.

Domestic security industry product classification according to the system can be divided into intrusion alarm systems, video surveillance systems, access control systems, electronic inspection system, parking management system, explosion-proof safety inspection system, etc.

1.1 domestic security industry has considerable market potential

As China's economic construction, intelligent buildings, large public places, shopping malls, new communities, factories and enterprises, etc., at the same time, with the improvement of income, consumption levels and structure has undergone major changes, these factors make the demand for security products has continued to improve, by 2006, the market size of China's security industry is more than $ 80 billion.

According to CCID forecast, due to the Olympic Games for the security products demand pull, 2008 domestic market will reach $ 184 billion yuan, the annual compound growth rate of up to 25%. And the subsequent World Expo 2010 Shanghai and Guangzhou Asian Games will be on domestic security market formation continued stimulation effect.

Monitoring system to occupy a major share of the market

In 2006 security industry products of various types of product sales, monitoring system market size # 1, entrance guard system and alarm system, the second and third place.

Monitoring system of market size # 1 benefited from financial, office buildings, shopping centres and transportation needs of the rapidly growing, and the public security field such as prisons, airports, ports and other places is a monitoring system of traditional markets, campus, community and family will be the emerging markets.

In economically developed areas are at the peak of the development of the industry

According to statistics, the Pearl River Delta, Yangtze River Delta, Bohai region and Fujian province set up China's security products revenue 83%, while other provinces together less than 17%, this is because only when living standards development to a certain extent will stimulate people's demand for security products.

According to the experience of developed countries, around us $ per capita GDP3000 will usher in the security industry development Summit period, this is domestic security industry sales area is the Pearl River Delta, Yangtze River Delta, Bohai economic circle in economically developed areas.

1.2 domestic security industry rapid development scale

2006 domestic security Enterprise nearly 2 million home, practitioners of nearly 100 million people, the industry began to increasingly intense competition, basic formation in the Pearl River Delta, Yangtze River Delta, Bohai region three security industry base, a common feature in these areas are: Security Enterprise centralized, industry chain tend to complete, with considerable scale and matching capacity, however, electronic security products upstream CCDsensor core and periphery chipset from foreign imports of components.

Which, in the Pearl River Delta-centric security industry has become China's largest and fastest growing, product number, type a maximum of security and high-tech product processing-intensive areas; to Shanghai, Jiangsu and Zhejiang as the center of the Yangtze River Delta, has become one of the security products manufacturing industry in key areas; Bohai region is formed by Beijing, Liaoning, Shandong, Tianjin's security industry group.

Although China's security industry now has a large number of small and medium-sized enterprises, small businesses, large enterprises, industry concentration is low.

Number of employees 50 people following enterprises accounted for more than 50 per cent of domestic enterprises is a small production company, instead of Tyco and Honeywell International giants such as solution provider.

1.3 domestic security enterprise competitiveness

To improve the

Strong domestic demand for security industry development opportunities, but also to see domestic security industry faces great challenges.

First domestic security industry concentration is low, generally smaller size of the enterprise, management more backward. In addition to domestic security enterprise research and development ability weaker, more equipment manufacturer, lack of planning and design capabilities, lack of overall security solution design capabilities. Such as the Beijing Olympics security planning and design are foreign participation, domestic enterprises (excluding military enterprise) does not take part in Olympic security overall solution design, and most only as equipment providers to participate in the Olympic Games security building.

Domestic enterprises are facing more competitive advantage in the competition of foreign manufacturers.

China's accession to the WTO, many transnational security company began gradually entered the China market, such as Panasonic, Samsung, Bosch, choose production base in China, in China, and then sold to all over the world. Foreign manufacturers access to domestic manufacturers enormous impact that foreign security Enterprise giant not only product quality, and a powerful brand, in high-end markets such as finance and national key projects, etc., are still used by foreign brand products. Another part of the security industry giants such as Tyco, etc is not exerting force in the domestic market, future domestic security vendors will face greater competitive pressure.

Security industry faced another problem is the low technical barriers to trade, industry, higher margin attracts many enterprises to enter the home appliance industry, for example, TCL, CHANGHONG has entered, making future industry more competition, lower margins in the year.

2. the Beijing Games to become China's security industry development opportunities

2.1 Olympic security inputs

History happened many terrorist attacks against the Olympic Games, and "911", the world's large games before the terrorist attacks of outgoing alert, which leads to the Olympic host nation to the Olympic Games security inputs increased rapidly.

According to information provided by the International Olympic Committee, the 1996 Atlanta Olympic Games into security funding 8250 million, the 2000 Sydney Olympic Games security funds soared to $ 1.98, Salt Lake City 2002 Winter Olympic Games because of the influence of "911" security costs appended to 4.9 billion. 2004 Athens Olympic Games security funds declare only 1.22 billion, "911", organizing Committee several times the cost of supplementary security and, ultimately, a total of up to 18 billion dollars.

2.2 Beijing Olympics a tremendous security market demand

The Olympic Games for security requirements, have stimulated the rapid growth of the security market, during the 1996 Atlanta Olympic Games, the United States security industry GDP growth rate from 1995 to 1996, the all-time highest surge in 30 billion a year.

Beijing Olympic Games, the security market demand comes mainly from the following two aspects:

Olympic venues and facilities will produce 3 million security market demand

Beijing Olympic Games venues you want to build a total of 37, including the Beijing area 32 (extension 13), Beijing is 5; independent training center-43, which in the competition of 16.

In addition, during the Olympic Games to the Olympic family members, national political leaders, journalists and spectators provide services area, construction and other related services for the Olympic Games. Only national stadium to purchase security equipment including 20 monitors, 150 spear-shaped stationary cameras, 49 ceiling infra red detectors, the demand for indoor hydrant box number is reached 620.

According to the Beijing Olympic Organizing Committee released the news that the 2008 Beijing Olympic Games security costs about $ 3 billion, accounting for the Olympics overall budget of 1/5, is second only to infrastructure budget's second largest budget.

This section of the budget will be used primarily for Olympic venues and facilities in the building of the security system, including access to management and control system, real-time control systems, emergency response systems.

Olympic games around social security needs of about 500 billion yuan market

In order to create security and stability of the Olympic Games of the external environment, and related security facilities also need to override the Olympic venues in the surrounding area and the whole city, including the provision of services for the games of the important communication facilities, electrical hot water and other needs special protection.

In accordance with the Beijing municipal science and technology to create an overall planning requirements, to the end of 2007, the city's vital parts, key areas, bustling place technology creates an must be 100 per cent compliance.

Beijing has more than 800 star, most of these hotels have to conduct security improvement, you need a substantial increase in the fire and alarm monitoring equipment. Community safety will be the technology to create, play, all kinds of new urban residential security to comply with the specifications, as-built houses will gradually put into security building, by 2006, the city's civil defense and security, preventing the organic combination of safe communities reached 95%, Olympic adjacent communities achieve 100%.

These large-scale infrastructure projects and facilities construction, spending a significant amount of safety equipment, including: the TV monitor, security alarm, access control, building intercom, security police and parking management system, etc.

It is expected that the Olympics will have 20 times more driving effect, start about 500 billion RMB in the security market.

3. Beijing Olympic Games will be listed on the relevant form far-reaching impact

As the Olympic Games hardware procurement have basically come to an end, we are here to select the part of the computer, telecommunications and other industries, these public companies listed on business primarily in the Olympic-related security system contract engineering.

From an economic perspective, these projects invested heavily, payback period is longer, usually 3-5 years, the short-term economic benefits. But we cannot ignore these items and the originalBusiness synergy that, while it should also be concerned about the impact of the Olympic Games this enormous publicity platform for improving the company's influential role.

3.1 Peng Ph.d. (600804): "green" City security monitoring network project

In July 2003, the official start of Beijing Olympic security effort.

In 2005, Beijing Municipal Public Security Bureau's internal units to defend all of Beijing Bureau requirements (including government departments, business units, etc.) to strengthen security through networking system control function, thereby protecting the urban public security and the Olympic Games in 2008, the success of the "security", "security of the overall goal of the Olympic Games". In September 2005, the company's subsidiary Telecom Circular by the Beijing Municipal Public Security Bureau authorization, bears the "green" City security monitoring network construction, operation and maintenance work.

The project will be completed in 2009 8.8 000 monitoring points

Company the business will use Japan "xikemu" company's mode (the world's largest electronic security companies), which is the product to the customer, the company responsible for the product installation, use, maintenance, in the event of an accident, immediately send professional security personnel to quickly rushed to the scene and, if necessary, the Office will report to the police, fire departments were processed, which formed the electronic preparedness, prevention and timely prevention of people's security system.

Project plan for the 2008 Olympic Games in Beijing before and after the insurance units, schools, communities, roads, public places, Olympic venues, information access point etc install 8.8 000 monitoring points, and complete all of the facilities of the building.

The project includes the insurance units 35,000 monitoring points, 20,000 monitoring points and order, 20,000 traffic monitoring points, 8,000 urban monitoring points, 3,000 community monitoring points, 2,000 education network monitoring point.

Economic efficiency and the advertising effect of "bumper"

From the company's project progress, as of early 2008, in addition to monitoring points of access projects, other system-building have been completed, can be put into use and generate profit.

Company security business income comes from the charge for each probe, the price of the monthly fee is 1000 Yuan/month. Preliminary calculations, if by 8.8 million completed and monitoring points and network operator charges calculated after 2010 is expected to reach $ 1 billion in revenue.

The project is completed, the cost is the primary source for all kinds of facilities of depreciation and maintenance expense, a conservative estimate of the net profit will amount to 15%, that is, each year produces 1.5 billion net profit, which greatly thickened company results for the next few years, become the main profit growth point.

The company also intends to expand the business scope, in Beijing on a trial basis, to the national promotion.

We think that the breach should be economically developed coast, if progress smoothly, then income will also be a new level. While the role of Olympic show will be more conducive to business continue to advance.

3.2 Gehua CATV (600037): in Chaoyang District image information management system

Beijing at 1 April 2007 by the Beijing municipal public security image information system management approach ", in the city's police, transportation, banking, and other key units and hotels, sport facilities and other key regional installation public safety image information system, to speed up the construction of urban monitoring system.

The Chaoyang District as the main venue for the 2008 Olympic Games and Beijing CBD Central District, to the security and the Olympic Games "safe city" project as an opportunity, in a total area of coverage, technical compatibility, information integration, efficient and practical image information management system for the region of image information resources management, real-time video image information and history with distribution and call.

The project "safe city" is an important component of the system

The project plan is mainly based on Gehua CATV high speed network, using digital image management and transmission technologies, establish a set of all-digital, networked, full management of image information platform system.

Main content in the following table:

Demonstration effect is greater than the economic benefits

The project won the tender for construction charges 2.49 billion image transmission fiber leasing, operation and maintenance of service each year annual fee 2640 million.

As the protection of the Olympic Games smoothly and construction of key projects, projects should be completed on the eve of the Olympic Games in 2008, the construction cost estimate will also be in 08-09 years included in the company's revenues, thus the company's short-term performance has thickened. At the same time, the annual fee for subsequent service has a high gross profit margin, in the next 5-10 years of creative part of the profits.

The system as the main Gehua CATV network that will enable the company to significantly strengthen the network utilization, reduce unit costs and enhance profitability.

Because of this system is the construction of the "green city" of the necessary elements of an Olympic demonstration effect will benefit the companies will run mode of Chaoyang District of further expansion to all Beijing or even the whole country, allows the company to further establish its leading position in the formation of the company.

3.3 tongfang co. (600100): Olympic tickets system

RFID has a wide range of applications and a huge market potential

RFID is mainly used in access control, asset management, supply chain management and transport fields; in addition, there are other kinds of applications include sport and health.

According to Frost & Sullivan predicts that by 2009, the Global RFID market will consist of 60 billion dollars in 2007 rocketed to 100 billion, of which only the application of the security class will take up to 30 million market, supply chain demand will reach $ 4 billion.

Domestic RFID market size will remain stable growth.

According to IDC estimates that by 2010, China RFID industryApplication of the overall market will reach 298.37 billion yuan, the 2005-2010 high compound average growth rate of 82.4%. Which 2008-2010 will be the RFID industry rapid development period, the Beijing Olympic Games, the Shanghai World Expo, Guangzhou Asian Games are RFID products are widely used.

Athens Olympic Games, various venues on the audience came to watch the game very strictly, holding checked tickets audience often told ahead of time 3 hours approach for complex close to various types of checks.

This is due to the stresses of terrorist activities, on the other hand also reflects that import and export inspection system is inefficient.

Tongfang co. provides RFID electronic ticket system adopts RFID radio frequency identification technology, its terminal identification device for tickets validation time is less than one second, admission to achieve synchronization capture.

Compared with the traditional manual recount, high efficiency, high accuracy, and also in security and other aspects have additional functions. This is the world's first RFID Contactless tickets to Olympic Games, will significantly increase the efficiency of the Olympic security, while at the same time enhancing the image of the Beijing Olympic Games and the company in the industry.

Olympics for the company's RFID business open circuit

Tongfang co. to overall donation of participation in the Beijing Olympics RFID electronic ticket system construction, the Beijing Organizing Committee for the donation, including RFID electronic ticket (does not include anti-counterfeiting printing), reading and writing tools, engineering, e-ticket system, the total amount donated is $ 5486.

Tongfang co. has its own core technology, has been successful in developing a second-generation ID card chip and become the country's second generation card chip one of four major suppliers.

This company provides a full set for the games of the e-ticket system, from the device to the construction of the run, all donation, will not produce any real gains. But if you focus on the future RFID huge market potential, the Olympic Games will become the company's RFID business important publicity platform that will enable companies in the world, games, etc. larger market opportunities in more competitive and increasingly expanding RFID market opportunities in the growing market share.

4. Expo, and other long-term industry hotspot more worth looking forward to

Currently, the majority of Olympic infrastructure has been completed, the relevant security systems of the procurement and installation process will come to an end.

But we believe the Olympic Games for the security industry's stimulating effect and not just temporary stimulus, which will be after the Expo, the Asian Games, the "green cities" building project formation continued enhancement effects. As for participation in the Olympic Games-related company that was successfully held at the Olympic Games would be sufficient to strengthen their impact and subsequent long-term industry hotspot, further enhance the competitiveness of the company's brand.

Expo 2010 Shanghai China, Guangzhou Asian Games

The Expo will be the Olympics after new investment hotspots

Shanghai World Expo 2010 for games, as of September 2007, 132 countries and 17 international organizations are invited to participate in the 2010 Shanghai World Expo.

2010 Shanghai World Expo is the first time in China, is also the first time in developing comprehensive World Exposition held, so a high degree of attention from the Government, the fourth session of the better of Expo 2010 Shanghai China included in the national "11th five-year planning framework.

Shanghai World Expo's investment is not inferior to the Olympic Games in Beijing and Shanghai World Expo held — ¶é — ' 是 2010-1 May to 31 October, a total of 184 days, time length far longer than the Beijing Olympic Games, will attract approximately 70 million passengers and foreign visitors, therefore the security work of Shanghai World Expo will be the play, will give security industry bring great business opportunities.

2007 Shanghai this year will invest 600 billion starting 13 major construction projects, including the comprehensive promotion of rail transport, airport reconstruction and expansion, etc.

Intelligent transportation project of the construction of parking management systems, electronic eye, GPS, mobile DVR, has large demand.

The other Expo involves reconstruction of the old town, hotel security and safe city, but also have boosted the demand for security products, according to the Shanghai Municipal Government plan, the opening to the World Expo in 2010, in the city's 20 000 webcam installed.

The games also have a great business opportunity

Compared with the Olympic Games in Beijing, Guangzhou Asian Games while the impact is relatively small, but the scale is not inferior to the Beijing Olympics.

In preparation for Asian Games Guangzhou from 2004 to 2010 6 years will spend 2000 billion for urban infrastructure upgrading and construction, and plans to invest 60 million for the construction and renovation of more than 50 new stadium, venue, including Guangdong 11 Olympic sports center stadium, Baiyun gymnasium, Asian Games Village, etc. In addition the games also will promote Guangzhou safe city building development, this will also give security industry bring great business opportunities.

4.2 "safe city"

In order to build a harmonious society, the people's security, the Ministry proposes to build safe city.

Beijing Xuanwu District, Hangzhou City, Jiangsu Province Suzhou city and Shandong Jinan City, four cities and regions for the pilot, the Ministry of public security has proposed "3111 engineering". "3" means three levels in the province. The first is "1" in each province to determine a city, the second "1" is each establish a county in the third "1" is set to the County a district or a police station, the plan was completed in 08. In the country identified 22 cities as "3111 engineering" of pilot cities.

The "green cities" project is the core cities alarm and monitoring system, the Ministry of public security in cities nationwide

Alarm and monitoring system construction "3111" pilot project to promote safe city construction, to the security industry brought many opportunities. 22 model city building in three years, the total investment of nearly $ 10 billion, such as Shenzhen 2003-2005 cumulative investment 14.64 billion for city police with technology, the city's banking and financial system 200 outlets total installed twenty thousand more cameras, 6 total over 3500 monitoring system, install the camera more than 9 million. In General, Christmas city construction on hardware needs to be much larger than the software requirements for domestic security enterprises get more market share.

4.3 benefit from long-term industry hot company

At present, the domestic security as the main camp of listed companies.

Some of IT, machinery and other industries the company's own business-oriented, open up the security business, mainly concentrated in the security device manufacturing and system solutions, and other areas of the business. We selected a group of related products or business with strong competitive companies, and will continue tracking the World Expo, games, and other hot spots on the company's investment opportunities.