NetPosa's Terrible Situation Worsens

By Charles Rollet, Published May 19, 2020, 08:12am EDT

NetPosa is fighting for its existence as the situation worsens for what was once the PRC's largest VMS provider. The firm is being investigated by Chinese securities regulators, has suffered another 90% sales drop, and has seen its embattled and debt-ridden founder resign from the board of directors.

IPVM Image

Last year, NetPosa was already under crisis for its many financial and legal issues. In this note, we examine the latest developments for this troubled firm, including:

  • NetPosa Background: Already Under Crisis
  • 2019 And Q1 2020 Report Dismal
  • Lower Government Spending, Strong Competition
  • Police Provider Subsidiaries Hit Hard
  • CSRC Investigation Of Liu Guang, NetPosa Announced
  • Investigation Impact Examined
  • Stock Price Mystery
  • Bad Look For Sichuan SASAC
  • NetPosa Response to Crisis

******* ******* ***** ******

** "****** ** *******" (******* ****), **** reported ***** *** ******* was ******** ******* ****** bills **** *** ****** local ********** *******, **** NetPosa's ***** ******** ********** standing ****** **** *** annual ******* ** $**** in ****, ***** *** made ** *****'* ******* VMS ******** ** *** time.

*******'**** *** ***** *** also ***** ** **** been ******** ****** ** debt ** *** *******'* name, ********* ** ******** from ********* *** *** shares ******* ******, * problem**** ********** ***** *** Sichuan ********** ********** *** bought * *********** ***** in *** ****.

* ***** *****, **** reported ***** **********'* ** **** ********* **** **** **%*** **** ** ********* ***** *** ********** *** **** *******.

2019 *** ** **** ****** ******

** ******* ******* ******** its**** ****** ******,******* * ****** ********* situation. *** **** *** ***** of **** $*** **** year, **** **% **** the **** ******, *** ended ** ****** $**** (figures ***** *** ** Chinese ****):

IPVM Image

* ***** ******* ** the ****** ***** *** to ** ******* ***: of *** $*** ******* in ****** ***** ******* had ** *** *** of **** **** **** than *** *********, $*** million **** **********'*** *****'*.*., ************* *** **** counted ** ********.

***** ****, ****** ******** further. *******'* ***** **** 92% ** **** $*.** and *** **** ****** a **** ** $**.**. Its ********* ****** ***** decreased **** ******** (*%) to $*** *******.

***********: ***** ********** ********, New ***********

******* **** ***** **** figures **** ******** ** "major ******* ** *** security ********," ******* ********* local ********** ********* ******* projects ** ** ******* or **** *******, ** a******** ** ************:

*** ******** ****** ** 2019 ** *** ** good ** ******** [...] S******* ******** *** ********: security ******** ** ******** regions *** ******* ** bidding ** **************, *** the **** ** ********** payments *** ****** **** significantly. ******* ******* ** required, *** *** ******* period ** **** ** long ** *-* ***** [...] *** ** *** decrease ** ********** ****** of ***** ***********, **** planned ******** ******** **** been ********* ** **** terminated, *** *** **** of ******* *** ********* projects ** ****** **** expected.

** ** **** **** PRC ********** ******** ** video ************ *** ****** in ****** *****. *** example, ********* ****************** **** ************* **** *** "************ demand **** *** ****** [government] ******** ******** *** fewer *** ********" ***** Hikvision's ********** ***** **** just*% ** $*.* *******. However, *****'* ** ******** of * ***********, **%+ style **** *********** ** NetPosa.

******** ** ********** ***** were *** *** **** factor ******* ******: ** also ******* ** *** losses ***** *********** **** ******* (China's ******), ******, *** "AI ********" **** ****** and *********:

*** ******** ***** ** technology ** *** ******* to ***** ** *** security ********. ***** ******* giants **** ** ******* and ******, **** ** unicorns, *** ******** *** focusing ** *** ******** industry, ***** *** *********** competition

Police ******** ************ *** ****

******* **** **** **** environment *** *** ************ especially ****,***********************,**** *** ****** ***** surveillance ******** *********.

*********, * ******** ********, went **** ****** ****** $10 ******* ** ******* in **** ** ****** $50 ******* ** ****** in ****. ***********, ***** focuses ** ***** ******* analysis, **** $*.* ******* in ******* ** **** but **** $**.* ******* in ****:

IPVM Image

*** ********* *** ***** like *****, *********, *******, Huawei, ******, *** ********* is *** **** ****** relations **** *** ******/**********, but **** ***** ******* sector *****, ********* ******* lacks.

**** ************* *********, ***** Resigns

** ***** **, ******* disclosed **** *** ******* Liu ***** *** *** company ****** **** ***** investigated ** ******** ********** ********** ********* (CSRC):

**. *** *****, *** company's ****** *********** *********** and ******* ********, ******** the "***** ********** ********** Commission ********** ******" (******* Investigation ****** **. *******), due ** *** ******* ’s ******* *********** ********** violation ** **** *** regulations [...] *** ******* and **. *** ***** will ******** ********* **** the **** ** *** China ********** ********** ********** and ********* *** ******** comply **** ********** ************ to ******* *********** ********** obligations.

*** **** *****, *** Guang******** **** *******'* ***** of *********. ******** ***** *** no ***********, *** ***** reported **** *** ******* to *** *************'* ************.

IPVM Image

CSRC ** *******; ***** ** ******* ** ************ *****

*** ****, ** *********, did *** ******** ******* what ** *** ************* Guang *** ******* ****. However, *** *********** *** the ******** ************ ***** Liu ***** ******** **** year.

** ************, ***** *** '*******' his ******* ****** *** cash. ** *******'* ***** price ********, ** ****** cash ** ***** *** pledges. ** *** **** cash, ** ******** ******** loans ** *******'* **** without ****** ***** *************. Guang **** ******** **** in **** ****** ** pay **** *******'* ******** accounts ********** *******.

** * ****** ** these *****, ***** *** sued ** *** **** creditors, *** *** ****** 20% ***** ** ******* was ******. ** *** time, ***** ***** ******* a ******** $*** *******, of ***** **** $** million *** **** **** so ***. **** ***** not **** ** ****** from ******* ** ******* where **** ****** ****** as ** *****.

Investigation ****** ********

* **** ************* ** not *********** *****. *********'* CEO *** ********** ** *** **** year,*** ***** *** **** * warning ********* ******* ****.

*******, ******* ** ** far ***** ********* ***** than *********, *** *** potential ***** *** *** investigation (**** ****** *** unauthorized *****) ** **** serious **** *** ********* (undisclosed ***** *****).

Bad **** *** ******* *****

*** **** ******** **** drew ******** **** *******'* SASAC (*** ********** ************ overseeing *****-***** *********) *** buying * *********** ***** of ******* **** ****. PRC ********* ***** **** commented ** ****,**** ******"****'* ***** **** ******* SASAC?" *** ****** ** "stepped ** * ****".

IPVM Image

******, ******* ***** ****** a *********** **% ***** in ******* ** *** 2019 ** *** ***** of $*.** *** *****, while ******* ********* ****** at ******** **** **** 40 *****, * -**% return.

** *** ****, ******* SASAC's ******** *** **** as * ******** ********** trying ** ******* * homegrown **** ******** **** had ****** ** ***** times *** ********** * bullish **** *** *******.

******* ***** *************

*******'* ***** ***** *** market ************** ** ********, to *** *** *****. Despite *** ******* ********, NetPosa ********* *** * market ************** ** ******$*** ******* (*** *.** billion *** *********** *****):

IPVM Image

**** ** ******** *** a ******* **** ********* 2019 ******** ** **** $51 *******, *** ***** its **** ***** ******. Netposa ** ******* ** nearly *** *******, ***** is **** ********** **** companies ********** ******* **%, instead ** *******'* ****** 90% *******.

*** ******* ********* **** outlet************** ***** *******'* *********** and **** ********** **** investors, ** "*** ** delisted" **** *** ******** Stock ********. *******, ** far, ***** ** ** sign ** **** *********.

******* ******** ** ******

******* **** ** ** responding ** *** **** cash **** ******* **** various *****:

  • ******* ** ***** **** $43 ******* *** *** sale ** *** ********* subsidiary ***** *********** ***** ************ ****** **** ****** early ** ******* *** rights ** *** **** on *** **** ******. So ***, **** **** has *** ********* ***.
  • ********* ********* *% ***** ** owns ** * ***** hedge ****,*** *****,** ********** ** ***** to ****** * $** million ****.

***** **** ** ****, but **'* *** ***** to ** *** **** can **** ** *** the *******'* *********** ********, chiefly * **** ** paying *********.

******* ** ********

******* *** *** ******* to ****'* ******** ******** for *******.

******* ****

***** *******'* ********* ******** are ***** **** *** own ********* *******, ** are *** ***** ***** how *******'* ******** ******* the ******* ***** ************ market. *******, **** ***** video ************ ********* *** challenged ** ******* ******* including **** ******** *** impact ** *********** (****** Netposa ******** ******* ******* that).

**** **** ** ********** to ***** ** ******* Netposa ** **** ** an ******* ** * sign ** *********** ******* for *** **** ****-****** 2010s ***** ***** ************ market.

Comments (6)

*******, **** *********!

*** ***** * **** fascinating ** *** ***** price. ** **** **** noticed **** *** ********** for ***** ***** ************ companies **** *** ****** than ***-***** ********* **** similar ******* *** *******. A *** ***** ***, a ********** **** ***** be **** ***** *** projected ******, *.*. *** valuation *** **** '****' but ******, *.*., *** company ********* ******* ** 30% ******** *** * years, **** *******'* ******* will ******* *********. ***** this **** *** **** true *** **** ***** it ****.

***, **** * ******* like *******, **'* **** to ******* ******** ***** to **** *********. ****** on *** ************, * company **** *** $** million ** *******, ******** 80%, ***** ****** $*** million ***** ** ****** worth ******** - ** would ** **** ** justify ****** $** ******* for **** * *******, compared ** *******'* ****** market *** ** ~$*** million.

** ** ***** ********* just **** ************ **** valuations ************ **?

Agree: 2
Disagree
Informative: 2
Unhelpful
Funny

*** **** ***** ***** stake ** ***********? ****'* got ** ** ** least ***** $*****... ***

Agree
Disagree
Informative
Unhelpful
Funny: 2

IPVM Image

Agree
Disagree
Informative
Unhelpful
Funny: 1

******: ***** ********** *** **** announced **************** ******* *** ***** rights ******.

Agree
Disagree
Informative
Unhelpful
Funny

*********** **** $** **** Netposa... **'* ************ **** can ***** **** **** money **** ****** ********* with ** ********* ** concerns ** *** *** shenanigans **** ******* ** include ****** *********. **** CEO ** ****!!!

Agree
Disagree
Informative
Unhelpful
Funny

******: *** ******** ***** Exchange*** ****** * "****** condemnation"** ******* *** *** massive ****** ***** *** non-disclosures, *******:

*** ***** ********** ****** to ******* *** ****** procedures *** *********** ********** obligations ** * ****** manner [...] ***** ****** were *** ********* ** a ****** ******.

**** ****** ******* ** legal ******, ** ********* as **** ** * warning ** *********. ******* is ***** ***** ************ by *** ****, ***** does **** *** *********** capacity.

************* *****,* **** *********** ********** with *** ***** ********,******** ****** *** **** ********** gives ******* ** ************** penalty, ********* **** ****** NetPosa's ****** ****** * certain ****** ** **** may ** ******** ** compensation.

Agree
Disagree
Informative
Unhelpful
Funny
Read this IPVM report for free.

This article is part of IPVM's 7,201 reports and 959 tests and is only available to subscribers. To get a one-time preview of our work, enter your work email to access the full article.

Already a subscriber? Login here | Join now
Loading Related Reports