Hikvision Gets $3 Billion From Chinese Government Bank

Author: John Honovich, Published on Dec 09, 2015

Hikvision has secured the biggest financing ever in the video surveillance industry.

Despite the groundbreaking news, Hikvision has been strangely quiet about it, with no English language announcements nor celebrations.

However, Hikvision and their largest shareholder, a Chinese government owned entity, did announce and explain it in Chinese.

In this note, we examine the financing and how the Chinese government bank is empowering Hikvision's international 2.0 strategy.

Financing Overview

The China Development Bank, one of the 3 government owned policy banks, is providing 20 billion yuan (~$3.1 billion USD) financing to Hikvision from 2015 - 2019. This looks to be credit / debt financing, not equity (though Hikvision is already largely owned by a different Chinese government entity).

Financing of ~$3.1 billion USD is quite tremendous, even for Hikvision's size (with nearly ~$2.8 billion USD revenue last year). The company has grown ~60% so far in 2015 and is clearly focused on continued top line growth.

International Expansion

Hikvision's President explained the strategy in the release on Hikvision's government owner's website:

"The implementation of international Hikvision 2.0 strategies to strengthen Overseas localization services for capacity-building, providing a comprehensive, multi-channel capital protection.... strategy to jointly carry out an important measure of global strategic layout, to further enhance our security products international competitiveness and global brand influence has an important role in promoting." (Google Translate)

Get Video Surveillance News In Your Inbox
Get Video Surveillance News In Your Inbox

Hikvision would not comment nor clarify to IPVM about the financing.

Abandoned Hong Kong IPO

At the beginning of 2015, Hikvision planned to do a Hong Kong IPO (in addition to their Shenzhen listing) of $1+ billion USD for international expansion. However, that was put 'on hold' after the market turmoil of the first half of the year. This new Chinese government financing makes that not critical.

Impact

For a global market (including China) that is ~$15 billion, ~$3 billion is an immense amount of funds to support global expansion and minimize needs for even mid-term profitability or cash constraints.

This financing is a critical component to power Hikvision to continue the pace of their rapid global expansion.

Hidden

On the other hand, the way Hikvision has handled this has shown their approach in (not) communicating with the rest of the world about critical news. As a Hikvision defender recently declared:

"So is Hikvision hiding something? Not if you can read Chinese."

Given this financing and Hikvision's approach, you may need to learn Chinese.

9 reports cite this report:

Hikvision $6 Billion: Doubles Chinese Government Funding on Aug 18, 2016
This is seriously bad news for the rest of the industry. Hikvision has announced a new $3+ billion line of credit, in addition to the previous $3+...
Dahua Fakes Being American on Aug 10, 2016
Robbed from the Hikvision playbook, now Dahua takes it turn. Dahua, China's second largest manufacturer, is ramping up its...
Dahua Approves $760 Million USD Debt on Jun 23, 2016
Hikvision has secured nearly $4 billion USD in debt this year ($3.1 billion here and $760 million here). Now, Hikvision's arch rival and #2 Dahua...
Hikvision Gets $770 Million USD More on May 31, 2016
If the $20 billion RMB from the China government's CDB was not enough 6 months ago, Hikvision has gotten another $5 billion RMB ($770 million USD)...
US Government Entities Hard Spec Hikvision on May 26, 2016
The US and Chinese governments are working together. Now, US government entities are not only buying video surveillance products from the Chinese...
Hikvision Growth Rate and Profits Falling Faster Q1 2016 on Apr 12, 2016
Just a year ago, Hikvision was an unstoppable force, growing at an astounding 60% rate. Now, after a weak Q4 2015, Q1 2016 was even worse. In...
Hikvision Growth Rate and Profits Falling Q4 2015 on Feb 24, 2016
Many, including us, were surprised by Hikvision's desperate price slashing on the final days of 2015. Now, it makes a lot more sense. Hikvision's...
Favorite Camera Manufacturers 2016 on Feb 08, 2016
The market has changed significantly since 2014, where our previous Favorite Camera Manufacturer report was led by traditional brands. Now, with...
Hikvision Dedicates $1.5 Billion To Dominate Western Market on Dec 18, 2015
During our recent China trip, many companies inside China, including Dahua, lamented how Hikvision is destroying the video surveillance market,...
Comments (35): PRO Members only. Login. or Join.

Related Reports on China

Ambarella CEO Admits H.265 and 4K Not Popular on Sep 26, 2016
Ambarella is the main chip provider for high-end surveillance cameras driving higher resolution and new CODECs. While Ambarella has been pushing...
Times Investigates Hikvision's Chinese Government Control on Sep 16, 2016
The Times of UK, founded in 1785 with 1.6 million daily readers, has published a 2 part investigation into Hikvision's government...
Dahua: "We're Not Owned By The Chinese Government" on Sep 15, 2016
Discover the Dahua Difference. This was Dahua's theme for ASIS 2016. They were quite clear with their response to our question:  How is...
Milesight - A Chinese "End To End" Solution Examined on Sep 01, 2016
Where most Chinese manufacturers have focused on their camera hardware, one is attempting to be the Avigilon of China. We spoke with the President...
US Embassy Requires Hikvision Cameras on Aug 29, 2016
The US Embassy in Kabul Afghanistan has required only Hikvision cameras in a new US federal government bid. However: Hikvision was founded...
Hikvision Chinese Government Origin on Aug 29, 2016
Hikvision originated from a Chinese government research institute. This is uncommon in the West but frequent in China. Hikvision was founded...
Hikvision $6 Billion: Doubles Chinese Government Funding on Aug 18, 2016
This is seriously bad news for the rest of the industry. Hikvision has announced a new $3+ billion line of credit, in addition to the previous $3+...
Directory Of 93 Video Management Software (VMS) Suppliers on Aug 15, 2016
This directory provides a list of Video Management Software providers to help you see and research what options are available. Listing Format The...
Dahua Fakes Being American on Aug 10, 2016
Robbed from the Hikvision playbook, now Dahua takes it turn. Dahua, China's second largest manufacturer, is ramping up its...
The Chinese / Ingram Micro Deal Has A Significant Chance of Being Killed on Jul 18, 2016
A Chinese airline / shipping company buying a Western IT distributor? Sounds like a bad deal. Nonetheless, earlier this year, Ingram negotiated a...

Most Recent Industry Reports

Camio Natural Language Processing Tested on Sep 27, 2016
The ex-Googler led team from Camio has advanced its video monitoring offering to include natural language processing. Camio ingests video,...
Hacked Dahua Cameras Drive Massive Cyber Attack on Sep 27, 2016
Cyber attacks are accelerating and IP cameras are behind many of them. Worse, last week, a 'massive' attack was carried out using numerous Dahua...
Axis Secretly Paid Anixter Sales People To Push Axis NVRs on Sep 26, 2016
Internal Axis communication shows how Axis paid Anixter and Tri-Ed sales people with secret bonuses to push Axis NVRs. In this report, we examine...
VLANs for Video Surveillance on Sep 26, 2016
Many people confidently say to 'use VLANs' as an answer to IP video networking problems and as a way to signal expertise. But how should VLANs be...
Ambarella CEO Admits H.265 and 4K Not Popular on Sep 26, 2016
Ambarella is the main chip provider for high-end surveillance cameras driving higher resolution and new CODECs. While Ambarella has been pushing...
Nest Cam Outdoor Tested on Sep 23, 2016
After years of claiming an outdoor model was "coming", addressing their biggest user demand, Nest has finally released their Outdoor Camera, an...
ACTi Refuses Race To The Bottom, Shifts To Solutions on Sep 23, 2016
The original low cost IP camera disruptor was ACTi. Back in the 2008 - 2010 time frame, Taiwanese manufacturer ACTi challenged the Western and...
You Get Robbed, Canary Will Pay You Up To $1,000 on Sep 22, 2016
Canary is trying to break the status quo in DIY security, first by raising over $40 million, and now a revamp of their monthly services package...
Milestone Ends Development of "Enterprise" VMS on Sep 22, 2016
Milestone 'Enterprise' was one of the first enterprise video management software offerings, selected by many early adopters of IP video. However,...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact