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Shares boom fuels IT innovation
Last Updated(Beijing Time):2007-05-11 13:37

Local construction firm employee surnamed Xue used to find it a pain to keep track of his stock market trading account after he bought shares two months ago.

"I couldn't access my stock accounts through the phone or Internet about two in three tries," Xue said. "It's like a lucky draw."

Xue, a 27-year-old, said he faced a busy message every time he wanted to buy or sell shares at the "absolutely right" time. And he said he's lost thousands of yuan in the delays.

It's crunch time for IT systems in securities firms and stock exchanges as China's strong equity market rockets upward. Shanghai's share index has nearly doubled to almost 4,000 from 2,000 within a year.

And about 300,000 people open new brokerage accounts to trade yuan-denominated shares every day recently, compared with 4,000 new accounts on average in 2006.

That puts a strain on IT infrastructure, so the shares rally has brought a boom to many IT firms, including computer server makers, software developers, Internet security firms and mobile phone operators.

Xue, who earned about 4,000 yuan in the stock boom, now trades shares on a mobile phone-based software called Tonghuashun (straight flush). The developer Hexin Software charges users 30 yuan a month or 200 yuan a year for the mobile service.

"I can take the cost of Tonghuashun. At least I needn't tolerate the 'busy line' again,"Xue said.

In 2006, China's IT investment in the equity industry was more than seven billion yuan (US$909 million), a 10.7 percent growth year-on-year, the highest growth rate since 2003, according to CCID Consulting Co, a research firm under the Ministry of Information Industry.

"The data-intensive IT system requires multi-functions including capacity upgrade, Internet security, risk management and back-up communications system," said Yan Haiyan, a CCID analyst.

Most investment, about four billion yuan, went on hardware purchase such as huge-capacity servers. The sector was dominated by Lenovo, Dell and Founder, according to Yan.

Industrial and Commercial Bank has upgraded its phone banking system after users' complaints that the "busy line" influenced capital transfers from bank accounts to securities accounts, ICBC said on Tuesday.

Security firms, too, have upgraded their IT infrastructure to solve the "busy line" problem, according to Haitong Securities and Guotai Jun'an Securities.

"The strong performance of the capital market and the various demand of investors in China have forced the securities firms to put more funds in IT infrastructure," said He Wei, Guotai Jun'an's vice president.

Guotai Jun'an, the country's No. 1 broker, signed recently with Ufida Software to adopt Ufida's accounting and finance system in its 113 outlets nationwide.

"It improves work efficiency and transparency to prevent equity fraud," He add.

IT investment will turn to "soft" areas in future as more financial products such as derivatives and equity index futures enter the market, according to analyst Yan.

"It is a more complicated system (the equity index futures scheduled to launch at the end of 2007) and we are working on the IT system to support it," said Zhou Hua, president of SunGard Kingstar.

SunGard Kingstar now provides IT trading systems for the Shanghai Stock Exchange.

Software such as Dazhihui and Stockstar allows individual investors to get up-to-date market information.

Dazhihui "sells well" among securities outlets and individual users, according to Shen Yu, the marketing manager of gw.com.cn, Dazhihui's developer. But Shen declined to reveal detailed sales figures.

The bull market fuels the country's anti-virus software market too.

Hackers can steal others' online accounts and passwords through computer worms, and worm authors can sell shares in stolen accounts at a low price.

Anti-virus provider Jiangmin saw its users jump by 20 percent year-on-year in March and April, not a traditional peak season, according to Cao Linxiang, the marketing manager of the Beijing-based firm.

"No direct evidence proves the growth from stock investors but there is an clear connection between sales growth and the opening account numbers," Cao added.

Sales of anti-virus software products such as Jiangmin, Rising and Kingsoft jumped about 20 to 40 percent recently, media reported.

Meanwhile, young investors are choosing to get information and trade stocks by mobile phones.

"Handsets are a natural second method for investors to access stock information or finish trades," Shanghai Mobile told Shanghai Daily.

People can get information through short messages even if they use entry-level phones. In April, investors sent more than two million short messages for stock information, a 50 percent growth year-on-year, said Shanghai Mobile.

Shanghai Unicom also teamed with 80 securities firms to launch the "handheld stock" service, which allows PDA phone users to check live exchange information.

The two carriers' mobile stock revenue jumped 30 to 50 percent in April year-on-year.

Source:Shanghai Daily 
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