Security industry has become a hot spot for investment in 2012

In view of the poor performance of the electronics industry in 2011, some experts suggested shifting the investment focus to security, military electronics, and smart terminal industries in 2012.

In 2012, the booming of the electronics industry is unlikely to occur and the industry shift may be reversed. The overall growth rate of the Chinese electronics industry may be relatively limited, and the industry as a whole may still be more difficult. Therefore, we will focus on those sub-sectors with stable growth or clearer prospects.

As the industry's overall price-earnings ratio is still high, taking into account the current industry performance decline risk is still relatively large, downgrading the industry investment rating to "neutral."

In 2012, we proposed to focus on security, military electronics, and smart terminal industries.

1. The security industry has the characteristics of anti-cycle, and the growth is relatively stable. The security industry benefits from the development of downstream markets and the upgrading of technology routes. Focusing on the major security projects, Hikvision and Dahua are able to provide overall solutions.

2. The development of military electronics is in line with the needs of the international situation. It may benefit from the transfer of government expenditures and import substitution effects, and focuses on AVIC electric measurement in the field of aviation sensors.

3. The growth of intelligent terminal equipment is relatively clear. Due to the previous cloud computing investment, the cloud's smart equipment has already had a good foundation for development.