Homegrown software industry favors policies

The General Office of the State Council issued a notice in recent days to approve and approve the “Deepen Implementation of the National IP Strategy Action Plan (2014-2020)”, which for the first time clearly put forward the new goal of “strive to build a strong intellectual property country”.

Analysts said that after the “Prism Gate” incident, the security of the cybersecurity information security industry has improved. Disabling Windows 8 has brought new opportunities to domestic operating systems. Localization has become a major trend in the context of accelerating economic restructuring in China, especially Domestic software industry will usher in a huge space for development under the new goal of “strive to build a strong intellectual property country”.

In recent years, the policies in the domestic software sector have continued to improve. On May 20, 2014, the Central Government Procurement Center of the Central Government issued a notice that all computer products purchased were not allowed to install the Windows 8 operating system. In September 2014, the China Banking Regulatory Commission website published "Guiding Opinions on the Application of Security and Controllable Information Technology to Strengthen Cyber ​​Security and Informationization in the Banking Industry," requiring that the security-controllable information technology achieve an overall utilization rate of about 75% in the banking industry in 2019. In November 2014, the National Integrated Circuit Industry Fund was established and 100 billion yuan of funds will be invested in the integrated circuit field. These policies have brought good macroscopic support to the development of the domestic software industry.

Judging from the recent market performance, since last July's rebound in the broader market since yesterday, as of yesterday, there are six domestic software concept stocks outperforming the Shanghai Composite Index (a cumulative increase of 63.08% over the same period), respectively: Huasheng Tiancheng (94.31%), China Kejin Financial (92.92%), Changshan (88.24%), China Software (82.35%), Xiangyou Technology (75.58%), UFIDA Software (71.43%).

It is worth mentioning that the disclosure of the current annual report has already begun. Analysts believe that the stocks of domestic software concept stocks are more likely to be favored by funds and usher in compensatory growth. As of yesterday, there were 7 domestic software concept stocks that disclosed the 2014 annual report forecast, of which 6 stocks were expected to achieve net profit growth year-on-year, namely: New Century (630.96%), Hilong Software (280%), and China Kejin. Finance (50%), Donghua Software (40%), Shiji Information (30%) and Jiuji Software (26.19%).

Hongyuan Securities stated that at present, China’s informatization infrastructure construction is relatively backward, and the independent innovation capability of core technologies is relatively backward. All of these threaten China’s national security and the quality of future economic growth. Therefore, the independent and controllable information construction will be a national The top priority of cyber security and informationization. The country will inevitably accelerate the establishment of an independent and innovative independent intellectual property information security system from software, Hardware, and other fields. It is expected that the IT infrastructure will go to the IOE and application software areas to further accelerate the localization of SOA, and the great era of domestic software has come. From the perspective of investment strategy, we are optimistic about the autonomous and controllable benchmarks: Taiji, Neusoft, and UFIDA; information security-related targets: Venus, and transactional targets: China Software, Beixinyuan and NSFOCUS.