Chinese digital video processing technology maker NetPosa Technologies announced today that it plans to issue an initial public offering of 17.5 mln shares on the Shenzhen Stock Exchange's ChiNext board at a par value of RMB 1 per share. Following the IPO, NetPosa will have a total of 70 mln shares. NetPosa's main business involves R&D, manufacturing, sales, and services for urban video monitoring and control platforms.

NetPosa says that its business depends to a fairly high degree on the investment of cities around China in security video monitoring and control systems for "tranquil city" projects. The urban video monitoring and control market, whose chief customers are governmental and public security agencies, is the largest segment of the video monitoring and control systems market, accounting for nearly 30% of the total. Since 2004, the Ministry of Public Security has selected more than 100 cities as demonstration sites for "technological vigilance" projects intended to promote the development of "tranquil cities." By 2009, selected "tranquil city" projects had completed first-stage construction. Tranquil city projects have since spread around the country. The Ministry of Public Security previously predicted that the cost of a "tranquil city" project to a mid-sized city should be in the tens of billions of RMB.

From 2009 to 2011, NetPosa had revenues of RMB 66.62 mln, 117 mln, and 209 mln, respectively, for a compound annual growth rate of 77.33%, and compounded annual growth in net operating profits of 72.22%.

In June 2010, Intel (Chengdu) purchased 3.15 mln shares, or 6%, of NetPosa. The company's prospectus states that Intel invested RMB 31.5 mln in NetPosa.

Source:marbridgeconsulting