Shulou(Shulou.com)06/02 Report--

Author: Yu Kuai, 2020-07-07 18:27 introduction: open your eyes, you will see more business and opportunities.

Recently, at the latest research meeting, Haikang answered questions about investor interviews.

In the face of the uncertainty of the needs of the software era and the industry environment, Haikang is optimistic that because of technological changes, the security industry is also upgrading and expanding its capacity. For example, in various security subdivisions, it has changed from focusing on the detection of cases to the prevention of potential dangers, from reducing traffic violations to reducing traffic accidents, which will reduce the operating input costs of the whole society. Open your eyes and you will see more business and opportunities.

For the mining of intelligent requirements, Haikang believes that at present, the mainstream is still face recognition, and other requirements are very fragmented.

In terms of fragmentation requirements, because the training-based AI involves samples, algorithms, engineering costs and other problems, not only AI technology can solve, such as code reading, a supplementary light problem under different angles, different places and different light is very challenging, so it is difficult to apply on a large scale. Haikang is not the only family that can cover this. For this reason, Haikang has launched the AI open platform, which mainly solves the problems of demand fragmentation and scene, and provides algorithm training capabilities for small and medium-sized enterprises and developers. Users can do data samples themselves. After the features of the sample training are extracted, the platform automatically loads them into the application system.

With regard to US sanctions, Haikang maintained close communication with Hayes and made good measures: on the one hand, it began to greatly increase the inventory of raw materials last year, and on the other hand, over the past few years, Haikang has had alternatives for raw materials for all products, as well as chips, to ensure smooth delivery.

The following is the full text of the survey. Lei Feng.com arranged and edited it without changing its original intention:

Q: in the past, in the era of hardware, the communication needs with customers were relatively smooth and natural, but now the upgrades are more in the dimension of software, with greater demand uncertainty and superimposed uncertainty of the economic environment. So how do we judge how the customer's demand for the new solution will hit the ground and expand?

A: we are optimistic about the development of the industry. Intelligence is just the beginning. For Haikang, the industry it faces is no longer security, security is only one of Haikang's business areas.

The security we are talking about today is not the concept of security in the past. For example, it is very important to solve the problem of public security in the early stage, and the priority of criminal offence is the highest. Ten years ago, there were about 15 homicides a year in the West Lake District, but last year there were none. However, social security is facing new challenges. If we can clearly grasp the risks in all aspects of society and make accurate defense against some potential risks, then the operating cost of the whole society will be greatly reduced.

In the field of transportation, for example, the annual death toll from traffic accidents across the country is about 60,000, which is only calculated according to the deaths that occur within 7 days after traffic accidents. How can the death toll from traffic accidents be reduced? The annual income of the national transportation insurance is about 400 billion yuan, and the claim payment is also about this figure. Now that the development of video technology has reduced traffic violations, can you reduce the number of traffic accidents? If it can be reduced, it will be a very meaningful thing. Although this kind of business is security, it is not just security. When we open our horizons, we will see business opportunities, and we can do a lot of meaningful things for society and users.

Q: at present, the government will have new investment in new infrastructure. In the past, the growth of Haikang's government business was related to the investment in national infrastructure. How does the company think that it will benefit from the new infrastructure?

A: at present, new infrastructure is a very hot topic, and we have not seen any special expenditure related to it in the security industry, but security has penetrated into all industries over the years, so no matter what the form of government investment, we can get some light. The new infrastructure may invest heavily in some applications, such as 5G base stations, although this has nothing to do with Haikang, but the base stations often put cameras together for the protection of these facilities, so it will play a leading role.

Q: does the company have any specific cases or effects in the mining of intelligent requirements and the business applications of enterprises? How will the company do this in the future?

A: with regard to intelligence, the more mainstream and relatively large-scale application we can see now is face recognition.

In addition to face recognition, the requirements we see are fragmented, so it is difficult to have large applications. For example, logistics reading code, whether reading bar code, QR code, code reading product form and use environment are very rich. Different sizes of QR code and bar code, different light, angle and so on, make the code reading requirements become very fragmented. At present, there are application requirements with small scale and capacity everywhere. How to solve the problem of fragmentation, many enterprises are also discussing, but now it is difficult to have a better way.

Because the current artificial intelligence is based on the training model, since it is based on training, it involves the problem of sample, the selection of algorithm, and the cost of engineering. It is not a simple grasp of artificial intelligence technology can be applied, in many cases will return to the cost of engineering. For example, I just mentioned code reading, in different angles, different places, different light, just a supplementary light problem is very serious, facing a lot of challenges. In order to solve the problem of demand fragmentation, we launched the AI open platform in 2019, which is mainly used to solve the problem of scene and fragmentation of intelligent applications. Users can do the data samples themselves, and the platform will automatically load the features of the training samples into the application system after extracting the features of the samples. The intervention of Haikang is not needed. Haikang provides the ability of algorithm training free of charge. The AI open platform is a free platform mainly for small and medium-sized enterprises and developers. According to the data disclosed in our annual report, the AI open platform has about 40 general functions online, the average daily calls to the platform is 35 million, and the cumulative training model is more than 10,000, of which more than 95% are fragmented model scenarios in the vertical industry.

Q: since the end of last year, people have been worried that Huawei may be subject to further sanctions by the United States, and a large part of Haikang's chips come from Hayes. What new preparations have the company made since it was listed on the entity list last year? Including how do you view the follow-up risks?

A: we are also very concerned about further sanctions against the United States. On the one hand, we maintain close communication with Hayes to pay attention to the extent to which U. S. sanctions are likely to be further increased, and the impact of the assessment. On the other hand, in the past years, Haikang does not only use Hayes chips, Haikang has alternative raw materials for all its products, and we are using products from other chip manufacturers at the same time. If we only look at it from the perspective of Hayes Chip, even if the US sanctions are further stringent, it will not have much impact on Haikang. Last year, we pulled the inventory of raw materials so high in order to cope with possible emergencies and ensure smooth delivery. Everyone is concerned about Haikang's operating cash flow and inventory problems. our inventory has increased significantly from 50 to 6 billion last year to almost more than 11 billion, in order to smooth the risks that may be brought about by the switching of suppliers. To ensure smooth delivery.

Q: with regard to inventory, raw materials rose a lot in 19 years, but they also changed the design of most products. Will there be a corresponding decline in inventory? Have you calculated the risk of this impairment?

A: the financial impairment risk must be done in strict accordance with enterprise accounting standards. As the products we do are embedded products, are purchased according to the plan, not spot transactions, the price is relatively stable, not affected by short-term fluctuations. We give suppliers rolling forecast, raw material prices are basically locked, the fluctuation is very small. Unlike memory strips and flash particles, sometimes they fluctuate very much. Our production plan is arranged according to the situation of raw materials, and the consumption of inventory will be considered before switching the design. In addition, our sales scale is still growing, and the proportion of inventory will be adjusted according to our sales and the supply of our suppliers. When adjusting, we also need to consider the impact of other risks, such as the impact of epidemic risk. For example, some chip manufacturers in Malaysia and the Philippines have all stopped, so we have to look at all aspects of the situation. If we want to reduce the risk of delivery, we still need to do more inventory, and whether the inventory data is up or down depends on how international trade, including US sanctions, evolves. In the short term, we do not have any downward adjustment; in the long run, we do want to return to normal. In three or six months, I don't think inventory will fall back from 12 billion to normal, because there are too many uncertainties that persist. The quantity of inventory and the structure of materials are constantly changing.

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