Wed, Oct 09, 2019 - Page 10 News List

Ban on rivals to benefit Hanwha

Reuters, SAN FRANCISCO and SEOUL

South Korean video surveillance provider Hanwha Techwin Co stands to gain the most from the US blacklisting of China’s Hikvision Digital Technology Co (海康威視數字技術) and Dahua Technology Co (大華技術), an industry expert and insider said, as rivals sit poised to snatch share from the besieged market leaders.

Hanwha Techwin is a subsidiary of Hanwha Aerospace Co Ltd, whose share price rose more than 4 percent following news on Monday the US had barred 28 Chinese entities from buying components from US firms without government approval.

Hanwha Aerospace said there had been growing interest in its surveillance products since the US-China trade conflict erupted.

“It is true consumer queries about our products and solutions have risen, as things are going between US and China,” Hanwha Aerospace said in a statement.

However, the blacklist of Hikvision had not affected its sales yet, Hanwha added.

John Honovich, founder of US-based video surveillance researcher IPVM, said Hanwha Techwin should benefit the most from the latest US action, taken in response to what Washington called human rights violations by Beijing.

Hanwha Techwin holds only 3 percent of the global share of the video surveillance market by sales, according to Hanwha, but South Korea is a major Asian security ally of Washington.

“They’re a South Korean company with low-cost, but relatively high-quality products, and so they’re the biggest alternative to Dahua and Hikvision,” Honovich said.

Hanwha Techwin’s US sales rose 24 percent to 66 billion won (US$55 million) in the April-to-June quarter from a year earlier, according to its parent’s earnings statement.

“Hanwha’s performance has been better since US stepped up regulations on Chinese firms,” Daishin Securities Co Lee Dong-heon said. “Mainly it supplies to US government and public institutions, but a wider door is open now to sell to private customers as well.”

Honovich said other likely beneficiaries of the blacklisting are Motorola Solutions Inc unit Avigilon and Sweden’s Axis Communications AB, owned by Japan’s Canon Inc.

Neither Avigilon nor Axis responded to requests for comment.

Motorola Solutions in its second-quarter earnings call with analysts in August said it saw upside from an earlier federal contracting ban.

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