Thank you for subscribing.

Please check your email to confirm.

Unsubscribe success..

You already subscribed and confirmed.

Please check your email.

You already subscribed.

Please check your email to confirm.

Week of Software on Shanghai Stock Exchange: Star Market Welcomes Hillstone
Week of Software on Shanghai Stock Exchange: Star Market Welcomes Hillstone
Protected? Image credit: Philipp Katzenberger/Unsplash
Associated Company
亿欧 亿欧

Software companies have poured into the new experimental Shanghai tech board, known as the Star Market (download EqualOcean report about the new trading venue). Infrastructure as a Service (IaaS) provider UCloud (A19019:SH), another cloud computing firm Eazytec (A19090:SH) and Kingsoft Office (A17055:SH), which is famous for office software package WPS Office, all got approved by the bourse on September 27. And here’s a new one.

Founded in 2006, Hillstone Networks Co., Ltd. (山石网科, 688030:SH) is a global network security software provider. With more than 17,000 users across 50 countries in various regions, including Americas, Europe, Southeast Asia and the Middle East, it develops and markets network border protection solutions, cloud, data center and intranet security products. The firm is headquartered in Beijing and has offices and R&D centers in Suzhou as well as in Silicon Valley.

Over the last three years, Hillstone spent a total of CNY 419 million (USD 58.66 million) developing new products. The amount of capital thrown at research and development has been steadily growing since 2016, reaching CNY 156.46 million (USD 21.90 million) last year. Holding only 36 patents, the firm is trailing even smaller candidates for the Star Market IPO. Being the second biggest (after Kingsoft Office) software company in the venue, it ranks ninth by this indicator.

High demand concentration leads to certain risks in any business. Five biggest customers accounted for 84.55% of the firm’s operating income in 2018, what’s more, this number grew from 76.79% recorded in 2017. The same story can be told about Hillstone’s product mix: network border protection products make up nearly 90% of the revenue, whilst the harbingers of tomorrow’s global connectivity – cloud and data center security solutions – are barely being developed by the three and a half hundred strong R&D team.

According to asset management firm Donghai Securities (东海证券), China’s network security market has been growing at a 30.79% CAGR over the past five years. There are over 3,000 companies that represent the industry in China. Some of them have already issued A-shares. For one, Venustech Group (002439:SZ) and Nsfocus Information Technology (300369:SZ) – two of the Hillstone’s direct competitors – are listed in the Shenzhen venue.

Enterprise Information

一家科技与产业创新服务平台
CATEGORIES: AI, Industrial Internet, GIIS, Big Data, WIM, BATi, Entertainment Media
Last Funding Type
Pre-Series C
Number of Employees
101-300
Number of Funding Rounds
6

Enterprise Information

亿欧
一家科技与产业创新服务平台
CATEGORIES: AI, Industrial Internet, GIIS, Big Data, WIM, BATi, Entertainment Media
Last Funding Type
Pre-Series C
Number of Employees
101-300
Number of Funding Rounds
6

Reach the Author!

Ask the author questions about the copied text

MOST READ

THE LATEST

Any Question

EqualOcean is an international information service provider and investment research firm that aims to become a global platform for industrial innovation.

We strive to make technology inclusive, accessible and transparent.

Join over 70,000 of your peers