上市捷报丨沙利文祝贺亚信安全科技股份有限公司成功登陆科创板(688225)

Yasen Security Technology Co., Ltd. (stock code: 688225) successfully listed on the Sci-tech Innovation Board on February 9, 2022. The company is a leader in the field of network security software in China, dedicated to safeguarding the industrial Internet and becoming an intelligent security platform enterprise that protects the cloud, network, edge, and endpoint in the era of 5G cloud networks. Frost & Sullivan (hereinafter referred to as "Frost & Sullivan") warmly congratulates the company on its successful listing.

Yasen Security Technology Co., Ltd. (hereinafter referred to as "Yasen Security") successfully listed on February 9, 2022, with an issue of 40,010,000 shares at an issue price of 30.51 yuan per share.

Yasen Security is a leader in the field of network security software in China. As a security company that "understands networks and clouds," it is committed to safeguarding the industrial Internet and becoming an intelligent security platform enterprise that protects the cloud, network, edge, and endpoint in the era of 5G cloud networks. Against the backdrop of the interconnected everything, booming digital economy, peak construction of 5G networks, and the emerging cloud computing industry, the company has put forward the development concept of "defining security boundaries." Based on identity security, focusing on cloud-network security and endpoint security, with the security middle platform as the hub and threat intelligence as support, it constructs a product technology strategy of "fully cloud-based, fully connected, and fully intelligent" to empower enterprises in their digital security operation capabilities in the 5G era. The company adopts a business model that combines direct sales and channel agency sales. Its customers are widely distributed in key information infrastructure industries such as telecommunications operators, finance, government, manufacturing, healthcare, energy, transportation, etc. In recent years, the company has actively cooperated with national network security work and is a technical support unit for the national network and information security information notification mechanism, a technical support unit for national major event network security, and a technical support unit for network security emergency services, becoming an important technical support force for national network security. Frost & Sullivan has long been paying attention to the global and Chinese TMT industries, publishing a large number of research reports, which are widely cited in the prospectuses of leading Sci-tech Innovation Board listed companies in the industry to help customers accelerate their growth.

Overview of the Network Security Industry

After going through development processes such as "communication security - computer security - information system security," the network security industry is currently in the development stage of "cybersecurity." With the continuous development of the information industry, the meaning of the network security industry has become increasingly broad, network security products and services have been continuously upgraded and developed, and the market scale has continued to expand. In 2020, the outbreak of COVID-19 had a relatively severe impact on the global economy. However, with the gradual recovery of the global economy in the later stage of the epidemic, governments and enterprises around the world have attached increasing importance to network security, and the network security market quickly recovered from the impact of the epidemic. In the future, as the boundaries of information security continue to extend, the demand for the network security industry will continue to grow. On the other hand, governments around the world are continuously introducing policies targeting network security, increasing investment in network security, and guiding the direction of technological innovation, which will also promote the long-term healthy development of the industry.

Market Scale of China's Network Security

The development speed of China's network security market has always been at the leading level globally. With the technological improvement of Chinese network security enterprises and the rapid growth of domestic market demand, the market scale of China's network security has reached a compound annual growth rate of 23.6% in the past five years, increasing from 20.96 billion yuan in 2015 to 48.92 billion yuan in 2019. At present, the hardware market is dominant in China's network security market, accounting for 54.4% in 2019, followed by services (28.5%) and software (17.1%). In 2020, the overall market scale of hardware, software, and services in China's network security market fluctuated somewhat under the impact of the COVID-19 pandemic. The market growth rate of China's network security will slow down under the impact of the epidemic, but in the long run, it will still maintain a rapid growth trend. On the other hand, in 2020, China once again emphasized accelerating the construction of new infrastructure. New infrastructure mainly includes seven major fields: 5G base station construction, UHV, intercity high-speed railways and urban rail transit, new energy vehicle charging piles, big data centers, artificial intelligence, and industrial Internet, which bring many new opportunities to network security. The construction of informatization and industrial upgrading requires network security to provide basic guarantee, and network security also needs to fully address the technical challenges in emerging business scenarios such as 5G, big data centers, and industrial Internet. Therefore, with policy regulation supervision, the advancement of emerging technologies, and the development of global network threat situations, the market scale of China's network security will further develop and is expected to reach a scale of 112.41 billion yuan in 2024, with a compound annual growth rate of 20.6% from 2020 to 2024.

Market Scale and Forecast of China's Network Security Industry

From 2015 to 2024 (estimated)

Source: Frost & Sullivan report

Overview of China's Network Security Hardware Industry

The hardware market is the largest sub-sector of China's network security market, accounting for more than half of the market share. From 2015 to 2019, the market scale of China's network security hardware increased rapidly from 11.75 billion yuan to 26.63 billion yuan in 2019, with a compound annual growth rate of 22.7%. The China network security hardware market consists of unified threat management (UTM), security content management (SCM), intrusion detection and defense (IDP), virtual private network (VPN), and traditional firewall. Among them, unified threat management accounts for the largest proportion, accounting for 62.9% in China's network security hardware market in 2019, followed by security content management (16.0%), intrusion detection and defense (12.4%), virtual private network (6.2%), and traditional firewall (2.5%). In the future, as security service providers improve internal systems such as technology research and development, marketing, and sales, enhance their technical strength and brand influence, and continuously expand and explore new market opportunities, the China network security hardware market will further develop. The market scale is expected to reach 533.8 billion yuan in 2024, with a compound annual growth rate of 17.7% from 2020 to 2024.

Market Scale and Forecast of China's Network Security Hardware Industry

From 2015 to 2024 (estimated)

Source: Frost & Sullivan report

Overview of China's Network Security Software Industry

The China network security software market mainly includes sub-markets such as endpoint security software, identity and digital trust software, and SAIRO (Security Analysis, Intelligence, Response, and Orchestration). In recent years, Chinese enterprise-level users have generally increased their acceptance of software-based security products. At the same time, with artificial intelligence, cloud computing, the Internet of Things, 5G, etc. empowering enterprise production and operation, network security products are applied to more and more emerging business scenarios, promoting the overall continuous growth of the security software market. The market scale of China's network security software increased rapidly from 3.32 billion yuan in 2015 to 8.36 billion yuan in 2019, with a compound annual growth rate of 26.0%. Among them, the identity and digital trust software market accounts for the largest proportion, accounting for 37.1% in 2019, followed by SAIRO (24.9%) and endpoint security software (24.4%); the growth rate of the SAIRO sub-market is the most obvious.

With the advancement of the digital transformation of Chinese enterprises, the driving force for government and enterprise informatization construction investment in network security is no longer limited to policy compliance but is more reflected in the internal needs during business development. At the same time, the budget investment of government and enterprise-level users is also shifting more towards the software and service market, and the development growth rate of China's network security software market is obvious. It is expected that by 2024, the market scale of China's network security software will reach 211.6 billion yuan, with a compound annual growth rate of 23.3% from 2020 to 2024.

Market Scale and Forecast of China's Network Security Software Industry

From 2015 to 2024 (estimated)

Source: Frost & Sullivan report

Overview of China's Network Security Service Industry

The China security service industry has four sub-markets, namely: managed security services, security integration services, security consulting services, and IT security education and training services. In recent years, the development of China's network security service market has been rapid, the number of security service providers has been increasing continuously, the content of security services has been enriched continuously, and the technical level of security service talents has been continuously improved. From 2015 to 2019, the market scale of China's network security service increased rapidly from 5.89 billion yuan to 13.93 billion yuan in 2019, with a compound annual growth rate of 24.0%. In 2020, affected by the epidemic, some network security service markets saw a decline in the overall market growth rate due to the inability to conduct on-site delivery. However, with the improvement of the epidemic situation, the security service market has gradually warmed up since the second half of 2020 under the influence of many factors such as demand release and project initiation. The market scale of China's network security service is expected to reach 378.7 billion yuan in 2024, accounting for 33.7% of the overall Chinese network security market.

Market Scale and Forecast of China's Network Security Service Industry

From 2015 to 2024 (estimated)

Source: Frost & Sullivan report

Frost & Sullivan has rich research experience in the TMT industry and has assisted well-known enterprises in successfully listing on the capital market. Successful listing cases include: Innovent AI (2121.HK), SenseTime (0020.HK), Qianhuai Data (NASDAQ: CD), Mingyuan Cloud (0909.HK), WeCom Group (2013.HK), Wankala OneLink (1762.HK), YASEN Technology (1675.HK), Feida (8342.HK), Aurora Mobile (NASDAQ: JG), Kingsoft Holdings (8606.HK), WeBank (2003.HK), Tenpay (1806.HK), Atlinks (8043.HK), Zioncom (8287.HK), ISP Global (8487.HK), Vobile (3738.HK), Aibo Technology (2708.HK), iClick (NASDAQ: ICLK), Shengye Capital (6069.HK), Anlink International (8410.HK), Anke Systems (8353.HK), Junmeng International (8062.HK), Future Data (8229.HK), and YASIB Backup (8290.HK).

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