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Lightning protection industry market analysis and capital trend report

Browse times:1434 Release time:2018-4-19

At the "2017 Second Summit Forum on the Development and Innovation of Lightning Protection Industry" held in Shenzhen, Chairman of Shenzhen Lightning Protection Association / Chairman of Shenzhen Kerui (Group) Co., Ltd. / Chairman of Shenzhen Qiding Management Consulting Co., Ltd. Xu Chunming made a report on "Lightning Protection Industry Market Analysis and Capital Trends." Xu Zong published the basic market data of the lightning protection industry, analyzed the pain points of the lightning protection industry and the trends of industry capital, and discussed the future development trend of the lightning protection industry.

Thunder in the natural world has direct and indirect harm to human social life, and society has a rigid demand for lightning protection. As a part of the security industry, lightning protection is widely used. Therefore, the concept of “new lightning protection and great safety” summarizes the current ecological and development trends of the lightning protection industry.

Lightning protection basic market data
1. Total scale of lightning protection industry
According to the forecast of Zheshang Securities before, from 2010 to 2015, China's lightning protection market capacity increased from 23.733 billion yuan to 37.554 billion yuan, with an average compound annual growth rate of 10%. Based on the 2016-2018 forecast of the fixed asset investment and the ratio of lightning protection products to the industry's fixed asset investment in various industries, the scale of the lightning protection market in 2016-2018 is estimated to be 36.586 billion, 38.383 billion and 40.765 billion respectively.
The Scale Measurement of China's Lightning Protection Industry Market from 2010 to 2018

▲Data Source: Zheshang Securities
2. Estimation of Lightning Protection Market in Communication Industry
In the construction of communication facilities, the investment in lightning protection equipment accounts for about 2%. We estimate that the scale of lightning protection in the communications industry in 2016, 2017, and 2018 will be 75.64, 74.36, and 7.808 billion yuan, respectively. Among them, SPD, lightning rods, and grounded products are used in the lightning protection market in the telecommunications industry by 50%, 28%, and 22% respectively. It is estimated that by 2018 the market size of SPDs, lightning rods, and grounded products in the communications sector will be 39.04 respectively. , 21.86 and 1.718 billion yuan.
2010~2018 Estimate of Lightning Protection Market in Communication Industry

▲Data Source: Zheshang Securities
3. Estimated Lightning Protection Market for Construction Industry
The scale of lightning protection in the construction industry will continue to grow steadily. The scale of the lightning protection market for the construction industry in 2016, 2017 and 2018 is forecast to be 83.87, 86.25, and 8.869 billion yuan, respectively.
Estimated Lightning Protection Market for Construction Industry from 2010 to 2018

▲Data Source: Zheshang Securities
4. Estimated lightning protection market for power industry (including new energy)
The investment in fixed assets of the power industry (including new energy sources) will still maintain a growth rate of over 10%, and it is estimated that over 10 billion yuan of lightning protection product demand will be generated each year. It is estimated that the scale of the lightning protection market for the power industry in 2016, 2017, and 2018 will be 123.55, 138.10, and 15.242 billion yuan, respectively.
Estimated lightning protection market for power industry (including new energy) from 2010 to 2018

5. Estimated Lightning Protection Market for Railway and Rail Transit Industry
The continuous investment in the incremental infrastructure of railways and rail transit has brought new incremental demand for lightning protection products. Coupled with the need for upgrading the existing infrastructure and lightning protection products, we expect that lightning protection products will occupy railway and rail transit fixed assets in the next three years. The proportion of investment will increase from 0.29% to 0.32%. The market scale of domestic railway and rail transit lightning protection products for the three years from 2016 to 2018 will be 35.05, 36.22, and 3.739 billion yuan.

6, petrochemical (inflammable and explosive) lightning market estimates
The scale of petrochemical (inflammable and explosive) lightning protection market will continue to grow steadily. It is predicted that the scale of the lightning protection market for petrochemical (inflammable and explosive) industries in 2016, 2017 and 2018 will be 46.76, 48.9, and 5.108 billion yuan, respectively. .
7, lightning protection product market structure
Lightning protection has a wide range of applications. The market share of communications, construction, power, rail transportation and petroleum and petrochemical industries is close to 90%.
The communications and lightning protection market is the largest, accounting for 26.88% of the total, and the construction industry is 24.43%, which together exceeds more than half of the total lightning protection market.
The proportions of rail transit and petroleum and petrochemical industries accounted for 9.69% and 8.95%, respectively.
In addition, there are also demand for lightning protection products in the aerospace industry, information technology, civil aviation, and other areas. The current total market share is approximately 10.74%.
The market structure of our national defense products:

▲Data Source: China Industry Information Network
8, The number of professional lightning protection companies
There are more than 1,800 enterprises specializing in lightning protection in China (Enterprises with lightning protection qualification before the “Gufa [2016] No. 39”), and there are more than 550 SPD manufacturing companies. There are about a few domestic enterprises engaged in lightning protection and grounding industries. More than 2,500, most of them focus on a single segment.
9. Number of mine detection companies
As of September 11th, 2017, the total number of companies in the certification period within the validity period was 491 (excluding peripheral offices or branches), of which: 163 were Grade A and 328 were Grade B. The qualification status of each province was as follows:
Five major pain points for lightning protection industry
Pain Point 1: Industry Policies Have Great Impact on the Industry
(1) Lightning Protection Project Policy
On June 28, 2016, the State Council issued the Decision on Optimizing Lightning Permits for Construction Projects, which requires that the government should decentralize power, integrate management, optimize the coordination of service reforms, and reduce the duplicated permits and repeated supervision of construction projects to effectively reduce the burden on enterprises. Further clarify and implement the responsibilities of relevant government departments, strengthen post-event supervision, and ensure the safety of construction projects against lightning.
(2) The latest policy for lightning protection product certification
On November 25, 2014, Guofa (2014) No. 50 State Council again cancelled and decentralized 58 administrative examination and approval projects. Circular 50 canceled the approval of the use of lightning protection products. The lightning protection product certification is no longer subject to compulsory testing and use registration approval. However, in the use of lightning protection products in major industries (electricity, communications, railways, etc.), it is still required to provide third-party type inspection reports.
(3) The latest policy of testing qualification
On April 7, 2016, China Meteorological Administration Order No. 31 "Measures for the Administration of Testing Qualification of Lightning Protection Devices". The competent meteorological agencies of provinces, autonomous regions, and municipalities directly under the Central Government shall be responsible for the management and certification of the detection qualifications of lightning protection devices within their own administrative areas; the testing qualifications shall be divided into two levels: A and B; a database of experts for the assessment of qualification of lightning protection devices shall be established and reported to the competent meteorological authority of the State Council. Recorded; "Lightning Protection Device Testing Qualification Certificate", unified printing by the State Council's meteorological authority, valid for five years.
Pain Point 2: Different Trade Thresholds Result in Increased Transaction Costs
In addition to the construction industry, major industries downstream of the lightning protection market have set certain thresholds for lightning protection products. The application of lightning protection products across different industries has resulted in an increase in the transaction costs of enterprises.

▲Data Source: Zheshang Securities
Pain Point 3: Homogeneous Vicious Competition
1, the entry barrier for product production is low
2, product assimilation, lack of disruptive innovation
3. Convergence of profit model (product spread)
Pain 4: The company's small scale and low industry concentration
1, scattered orders, large orders less
2. Most companies do not have control over the scope of economy and economies of scale
3, the industry's unfair competition has created a company to do less
Pain point five: industry brand awareness is weak
1. No patience, interest driven
2. Industry bidding rules issue
3, do not know how to do brand
4, the customer is not clear which brand is good?
Pain points in the industry are opportunities for innovation and development. Some suggestions for solving industry pain points:

Lightning Industry Capital Trend Analysis
1. The role of capital
Industry development requires capital to enter
The Nobel Prize winner and American economist Stigler: “Looking at the world’s famous big companies, big companies, no one is not somehow developed through capital operations, and there is no One is simply relying on the accumulation of corporate profits."
2. Lightning enterprise capital operation
Lightning protection industry companies are actively exploring the capital operation process. At present, a small number of companies have successfully conducted IPOs, mergers and acquisitions, and the new three board listing.
3, capital (listed companies) like businesses: large market capacity; unique business model; excellent team. 4. Five levels of innovation of traditional enterprise business models 5. Business Model Innovation 6, lightning protection industry integration The future development trend of lightning protection industry 1. The lightning protection industry enters the stock market stage From the analysis of the above industries, it can be seen that the space for the development of the lightning protection industry still exists, and the industry is entering the mature development stage from the stage of rapid development. On the whole, the lightning protection industry will enter the stock market stage from the incremental market stage. In the competitive state of the stock market, the lightning protection enterprises will have fierce competition in business models, product brands, new technologies, and new services. 2. Development trend of lightning protection industry 1) The implementation of No. 39 document will make the lightning protection industry further market-oriented; 2) The industry application will be subdivided, product brands will appear in each segment, and most brands will be integrated or closed down; 3) Professional lightning protection engineering companies will further develop the rigid demand market with high levels of lightning protection technology and expand other customer-focused projects or products or services. 4) Lightning protection has entered the stock market from the incremental market; 5) Emerging technologies will continue to emerge, especially smart lightning protection; 6) Industry alliances, industry consolidation and mergers and acquisitions will rise; 7) Customer-centricity will become the mainstream, and industry boundaries will become increasingly blurred.

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