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Market Research Report : Cyber security growth in India 2012


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The basic premise of making fast money or transgressing into competitive warfare to a more grave espionage has initiated the malaise called cyber attacks. Cyber attacks could target anyone be it an MNC or even Small and Medium Enterprise (SME). In all the cases, the certainty in such exercises is that companies fall prey to such attacks and are subjected to a high degree of reputational risk in addition to financial losses incurred due to data leakage. Moreover, as technological advancements render heightened adoption of smartphones or other such devices that induce greater internet connectivity, risks associated with cyber domain loom large translating into more cyber attacks. What renders it to be more insidious is that these attacks do not follow any common pattern or motive and thereby becomes more dangerous not only in terms of information security for companies but also for national security as a whole. As more and more cyber attacks get recorded across the world, cyber security solutions are poised for further growth.

The report begins with the introduction of concept of cyber security along with a brief snapshot of the objectives as well as the efforts required to secure systems in the cyber space. It then goes on to describe a work model of cyber security in terms of the defense mechanism it follows. The report then moves towards providing a brief overview of the global cyber security market with the global as well as Asia Pacific market size and growth along with a competitive landscape. This is collaborated with snapshots and some facts associated with global cyber security arena. Then the report goes on to describing the Indian market along with its market size and growth. It gets followed by a brief detailing about the different types of cyber attacks witnessed across the cyber space. This gets immediately succeeded by a value chain analysis that speaks about the individual components that summarize the process of providing security solutions. Next in line is an elaborated discussion on the types of cyber security and brief descriptions added with it. Then next section speaks about the best practices followed in the market in terms of cyber security solutions. It then discusses about the market scenario in SMEs and associated growth opportunity in the said sector.

Brief descriptions of the drivers that help the sector to prosper include increased wired and wireless usage, rapid computerization, presence of smart handheld devices, growth of e-commerce, growth in cloud computing and rise in cyber attacks. Increase in the usage of internet both in the wired as well as wireless forms make for a potential driver for the cyber security market in India. As broadband penetration intensifies and Wi-Fi hotspots develop across the country, systems are more prone to cyber attacks thereby demanding protection in terms of cyber security.

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Market Research Report : Cyber security growth in India 2012

  1. 1. Cyber Security Market in IndiaCyber Security Market in IndiaSeptember 2012
  2. 2. Executive Summary  Global cyber security market has been posting a healthy growth rate of ‐% over the years 20‐‐  The Indian cyber security market is growing at a considerable rate of ‐% annually Market  The concept of cyber security is evolving with myriad growth opportunities across different  sectors including a prospective opportunity in SMEs which has recently emerged as a target for  cyber attacks  cyber attacks Drivers Challenges – Increased wired and wireless internet  – Availability of pirated software Drivers &  usage Challenges – Rapid computerization – Lack of interest in updating software Lack of interest in updating software – Presence of smart handheld devices – Growth of e‐commerce – Growth in cloud computing – Rise in cyber attacks Rise in cyber attacks  Cyber security players foray into mobile   India looking at building national cyber  security security architecture Trends   Cyber security body designed for power sector   Training institutes design courses on cyber  by Indian Government security  Adoption of virtualization Major PlayersCompetition CISCO Fortinet Technologies Kaspersky Lab McAfee Symantec Corporation Quick Heal CYBER SECURITY MARKET IN INDIA 2012.PPT 2
  3. 3. •Introduction•Market Overview•Cyber Security Types•Cyber Security Best Practices•Cyber Security for SMEs•Drivers & Challenges•Government Regulations•Government Regulations•Vendor Opportunities•Trends•Major Players•Strategic Recommendation•Appendix CYBER SECURITY MARKET IN INDIA 2012.PPT 3
  4. 4. Global Cyber Security – Snapshots (1/2)  How do breaches occur across the world? SAMPLE  Sectors Affected – Global  % s1 d2% a1 s2 b1 s3 c2% a2% s4 c1 d1 e1 b2% a b c d e Countries Affected  Countries Affected Malware – Growth  Malware Growth c1 c7 Unit no e c2 c8 z y o c3 c9 x c4 c10 f c5 c11 n g ml h c6 k j i 20‐‐ 20‐‐ CYBER SECURITY MARKET IN INDIA 2012.PPT 4
  5. 5. As technology continues to outpace policy and enforcements, need for cyber security continues to rise SAMPLE Cyber Security – Indian Market Overview   • India Inc has witnessed four fold jump in cyber attacks which states the reason why Indian companies are  increasingly understanding the significance of cyber security • Since many organizations are dependent on latest Internet technologies to enhance their competitiveness  within both domestic and international markets, issue of cyber security is a reason to worry • India has emerged as the top r1 nation in the March quarter of 20‐‐ • As internet population in India continue to rise after crossing ‐ cyber crimes are also in the rise • A considerable percentage of r2 attacks have been on Indian brands that used the r3 domain and r4  constituted the major sector that emerged at the receiving end of these attacks Cyber Security – Market Size & Growth Cyber Security – Segmentation (2011) S1 S2 S3 INR bn z x s r q p o m n 0 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ y CYBER SECURITY MARKET IN INDIA 2012.PPT 5
  6. 6. Security – Types prevalent in the cyber domain (1/8) Types of Cyber Security Network Security Examples • Network security can be defined as the  authorization of access of data in a network which  e1  is controlled by the network administrator wherein  e4 users are assigned an ID and password that allows  them to access information and programs within  e2 their authority • Is composed of components both of software and  e5 hardware which are designed to work in tandem to  e3 improve security and maintenance Application Security Examples • Application security is the use of software Application security is the use of software,  e6 e9 9 hardware and procedural methods to protect  applications from external threats • Security measures built into applications along  e7 e10 with a sound application security routine minimize  the probability of manipulation of applications and  p y p pp access, steal, modify or delete of sensitive data e8 e11 CYBER SECURITY MARKET IN INDIA 2012.PPT 6
  7. 7. … as major viruses attack these small enterprises … SAMPLE Cyber Security – Small and Medium Enterprises (SMEs) (2/3) • SMEs are vulnerable to cyber attacks owing to the reason that they have smaller customer base along with  limited product lines as compared to the MNCs • They are also considered as having poor IT infrastructure loaded with problems like absence of resources, IT  infrastructure and skilled manpower • The ever‐increasing threat by cyber attacks have brought the weakness of SMEs to light and made them  vulnerable t1% of the attacks were aimed at firms with  Only t3% of the targeted attacks were against the CEOs or senior managers lower than l th t2 employees l Threat of cyber attacks are on the rise in Indian cities  t11 of the attacks were aimed at firms with  such as t4 t5 t6 t7 t8 and t9 with t10% bot such as t4, t5, t6, t7, t8 and t9 with  bot  infections    % fewer than t12 12 employees • It is of common opinion by industry experts that average cost of the worst IT information security breaches in small companies is not  a small amount a small amount • It is of tremendous shock that majority of such companies are not equipped with contingency plans to counter cyber attacks or even  required security level to take measures against it CYBER SECURITY MARKET IN INDIA 2012.PPT 7
  8. 8. Drivers & Challenges – Summary   Drivers Increased wired and wireless internet  usage Rapid computerization Challenges Presence of smart handheld devices Availability of pirated software Growth of e‐commerce Lack of interest in updating software Growth in cloud computing Rise in cyber attacks CYBER SECURITY MARKET IN INDIA 2012.PPT 8
  9. 9. High possibility of cyber threats from the use of internet happens to be a major driver for the marketIncreased Wired and Wireless Internet Usage (1/2) Impact• Usage of internet makes an user highly vulnerable to cyber threats, as most of the malicious  softwares are spread and activated through internet from remote locations • Generally, individuals or business organizations tend to avoid exposure to cyber threats and  hence invest in security softwares  These softwares also need to get upgraded to newer and better versions, which also attract revenue  generation for these vendors• India is currently witnessing an exponential growth in the internet usage amongst its population India is currently witnessing an exponential growth in the internet usage amongst its population  Diminishing internet tariffs, easy accessibility and growing popularity of social networking sites are some of  the major factors boosting internet usage amongst individuals  Companies or enterprises are also showing prominent symptoms of embracing dynamic concepts such as  cloud computing and Enterprise Mobility (EM) which in turn inject growth in the internet usage Internet Users – Growth in India mn n m l k j i 0 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ CYBER SECURITY MARKET IN INDIA 2012.PPT 9
  10. 10. IT and telecom sectors constitute the prime areas for cyber security measures and adoption SAMPLE IT & Telecommunication Sector – Overview  IT/ITes Sector – Growth  • Threats related to cyber security are on the rise  wherein critical infrastructure like  telecommunication and information technology has  INR tr u t become targets s • The attacks are no longer confined to just  r information infrastructures and geographical  q p boundaries but have extended to exploitation of  network interconnections and navigation through  infrastructure i f t t • Cyber security therefore becomes an essential  20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ requirement in this domain Tele‐density – Growth  Tele density Growth p • India is on the lookout to establish a new body that  Unit will oversee telecom and cyber security  v • The body, called p1, will be headed by the telecom  w secretary and will have representatives from the  defense and home ministries, intelligence agencies,  d f dh ll IT department, intelligence bureau, National Security  Advisor and NTRO, among others u • The body will address network security issues and  also set up objectives and targets to various  departments and agencies handling telecom and  20‐‐ 20 20‐‐ 20 cyber security related issues   CYBER SECURITY MARKET IN INDIA 2012.PPT 10
  11. 11. Government Regulation – Summary   Government Initiatives  Participation p Cyber Law Cyber Law CERT In  CERT‐In CYBER SECURITY MARKET IN INDIA 2012.PPT 11
  12. 12. Some of the statistics revealed by CERT‐In SAMPLE CERT‐In (3/3) Defacement refers to hacking or defacing sites by attacking the sites which changes the visual appearance of  the sites  J Unit no f Unit no A j k N‐2 J e U0 L11 2 g h i l m n 0 1 e1 f1 g1 h1 i1 j1 k1 l1 .m1 n1 2 Unit no Unit no J k2 m2 q2 A N‐2 p2 J o2 U0 a2 b2 c2 d2 e2 f2 2 g2 h2 j2 l2 n2 r2 s2 L i211 2 0 1 a3 b3 c3r d3 e3 f3 g3 h3 i3 j3 k3 l3 m3 n3 o3 p3 q3 r3 s3 2 Open proxy servers serve as the major sources of Spam on the Internet and are used to launch attacks on  other systems  CYBER SECURITY MARKET IN INDIA 2012.PPT 12
  13. 13. Trends – Summary  Cyber security players foray into mobile security Cyber security body designed for power sector by Indian Government ` Key Trends Adoption of virtualization India looking at building national cyber security architecture g g y y Training institutes design courses on cyber security T i i i i d i b i CYBER SECURITY MARKET IN INDIA 2012.PPT 13
  14. 14. Training institutes designing courses in cyber security have shaped the sector as a relevant trend  SAMPLE Training institutes design courses on cyber security • Several courses  M O have been  designed owing to  • ‐ is the training wing of ‐ to provide information security  the latent  training • A two‐year post  • It has categorized training programs separately for beginners,  graduate course  potential that the  administrators, advanced and developers in cyber security  sector is deemed  • It looks at providing training on subjects including ethical  was started by ‐ to be possessing to be possessing hacking, wireless security, network security, database  h ki i l it t k it d t b in Coimbatore in  in Coimbatore in • As need for cyber  20‐‐ which marks  security, operating systems security, intrusion detection and  it to be the first  security increases,  analysis, e‐crime and computer forensics, virtualization and  course in cyber  demand for  security, web application security, cloud computing security  security started  professional hands  and others in India also rises • The areas for  research  research • Capitalizing on the  included in cyber  opportunity for  N security ranges  security needs,  across  training institutes  cryptography,  have delineated  • ‐ has launched world‐class infosec education programs to  visual  courses on these  courses on these provide training on information security management as well  provide training on information security management as well cryptography,  as certification programs multimedia  lines to render  security,  proper training to  • The ‐ is an integral part of ‐ which offers programs such as the  intrusion  people who wish  Official (ISC)2 CISSP Review Seminar, IRCA accredited ISO  detection,  to embark on a  27001‐Advanced ISMS Auditing Course and Certified Ethical  wireless security,  career on cyber  Hacker (CEH)  web and internet  security   security • ‐ is another offering that is a one‐year program in is another offering that is a one year program in  security and  security and Information Security Management  others   CYBER SECURITY MARKET IN INDIA 2012.PPT 14
  15. 15. Public: Foreign Company – Company 1 (1/3)Company Information SAMPLE  Offices and Centres – India Corporate AddressTel No.Fax No.Website Place   Year of IncorporationTicker SymbolStock Exchange Head OfficeProducts and ServicesProducts and ServicesCategory Products/ServicesServices/ Products S1, s2 Key People Name N Designation D i ti P1 D1 P2 D2 P3 D3 CYBER SECURITY MARKET IN INDIA 2012.PPT 15
  16. 16. Public: Foreign Company – Company 1 (2/3)Financial Snapshot i i lS h SAMPLE  Key Ratios K i Total Income Net Profit/Loss y‐o‐y change  Revenue Profit Particulars  2011 2010 2009 2008 (2011‐10) INR mn INR mn y Profitability Ratios x z Operating Margin ‐1.27 16.29% 17.56% 17.60% 12.80% w Net Margin ‐2.34 9.52% 11.86% ‐109.45% 6.81% Profit Before Tax Margin ‐2.52 11.20% 13.72% ‐106.50% 10.35% Return on Equity ‐2.82 12.88% 15.70% ‐163.64% 3.74% Return on Capital Employed ‐1.20 12.97% 14.17% 15.31% 5.39% 3141.67 Return on Working Capital ‐268.80 ‐145.70% 123.10% % ‐588.51% 20-- 2009 2010 2011 Return on Assets Return on Assets ‐1 69 1.69 4.66% 4 66% 6.36% 6 36% ‐63 79% 63.79% 2.27% 2 27%Financial Summary  Return on Fixed Assets ‐18.76 56.48% 75.24% ‐697.43% 40.93% Cost Ratios• The company incurred a net profit of INR ‐ mn in FY 2011, as  Operating costs (% of Sales) 1.26 83.60% 82.34% 82.26% 86.87% compared to net profit of INR ‐ mn in FY 2010 Administration costs (% of  3.00 48.43% 45.43% 44.37% 47.04%• The company reported total income of  INR ‐ mn in FY 2011, as  Sales) compared to INR ‐ mn in FY 2010 compared to INR mn in FY 2010 Interest costs (% of Sales) I t t t (% f S l ) 0.15 0 15 2.31% 2 31% 2.16% 2 16% 2.03% 2 03% 2.03% 2 03%• The company earned an operating margin of ‐ % in FY 2011, a  Liquidity Ratios decrease of ‐ percentage points over FY 2010 Current Ratio ‐20.54% 0.92 1.15 0.94 0.98 Cash Ratio ‐25.62% 0.62 0.83 0.60 0.68• The company reported debt to equity ratio of ‐ in FY 2011, a  decrease of ‐ % over FY 2010 Leverage Ratios Debt to Equity Ratio 19.89% 1.76 1.47 1.57 0.65Key Financial Performance Indicators Debt to Capital Ratio 3.41% 0.30 0.29 0.30 0.17 Interest Coverage Ratio ‐13.37% 7.10 8.19 8.73 6.48 Indicators Value Efficiency RatiosMarket Capitalization (INR mn) ‐ Fixed Asset Turnover ‐6.52% 5.90 6.31 6.32 5.86Total Enterprise Value (INR mn) ‐ Asset Turnover ‐8.67% 0.49 0.53 0.58 0.32EPS (INR) *EPS (INR) * ‐ Current Asset Turnover Current Asset Turnover 0.31% 0 31% 1.38 1 38 1.38 1 38 1.87 1 87 1.57 1 57 Working Capital Turnover ‐247.39% ‐15.21 10.32 ‐28.47 ‐84.31PE Ratio (Absolute) * ‐ Capital Employed Turnover 2.15% 1.34 1.32 1.48 0.54 Improved Decline CYBER SECURITY MARKET IN INDIA 2012.PPT 16
  17. 17. Public: Foreign Company – Company 1 (3/3)Key Business Segments SAMPLE  Key Geographic Segments s1 s2 s3 s4 g1 g2 g3 a4 a5 a6 a7 a8 a9 a10 a11 b4 b5 b6 b7 b8 b9 b10 b11 c4 c5 c6 c7 c8 c9 c10 c11 d4 d5 d6 d7 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐Key InformationDescription  Details • ‐ provides security, storage, and systems management solutions internationally • ‐ markets and sells its products through distributors, retailers, direct marketers, Internet‐Overview based resellers, original equipment manufacturers, system builders, and Internet service  providers; and its e‐commerce channels, as well as direct sales force, value‐added and  large account resellers, and system integratorsMost Recent Auditor •‐ CYBER SECURITY MARKET IN INDIA 2012.PPT 17
  18. 18. Private: Domestic Company – Company 2 (1/3)Company Information SAMPLE  Offices and Centres – India Registered AddressTel No.Fax No. Place       WebsiteYear of Incorporation Registered  AddressProducts and ServicesProducts and Services Category Products/ServicesServices S1 Key People Name N Designation D i ti P1 D1 P2 D2 P3 D3 P4 D4 CYBER SECURITY MARKET IN INDIA 2012.PPT 18
  19. 19. Private: Domestic Company – Company 2 (2/3)Financial Snapshot i i lS h SAMPLE  Key Ratios K i Total Income y‐o‐y change  Particulars  2011 2010 2009 2008Total Income Profit (2011‐10) INR mn Profit / Loss INR mn  Profitability Ratios o Operating Margin ‐10.41 42.79% 53.20% 51.32% N.A. Net Margin ‐6.36 30.25% 36.61% 34.58% N.A. Profit Before Tax Margin ‐9.93 44.66% 54.58% 52.70% N.A. n Return on Equity ‐22.48 26.91% 49.39% 50.10% 56.25% m Return on Capital Employed ‐34.01 43.18% 77.19% 72.57% 0.00% Return on Working Capital ‐35.02 66.48% 101.50% 81.20% 64.71% Return on Assets ‐19.08 26.87% 45.94% 44.26% 51.51% Return on Fixed Assets ‐1.18 261.72% 262.90% 330.43% 272.32% Cost Ratios 20‐‐ 20‐‐ 20‐‐ Operating costs (% of Sales) 10.35 56.40% 46.05% 47.96% N.A. Administration costs (% of  N.A. N.A. N.A. N.A. N.A.Financial Summary  Sales) Interest costs (% of Sales) Interest costs (% of Sales) N.A. NA N.A. NA N.A. NA N.A. NA N.A. NA• Company incurred a net profit of INR ‐ mn in FY 2011, as  Liquidity Ratios compared to net profit of INR ‐ mn in FY 2010 Current Ratio 0.49% 4.37 4.35 6.74 8.62 Cash Ratio 156.18% 3.62 1.41 2.43 1.34• It reported total Income of  INR ‐ mn in FY 2011,  Leverage Ratios registering a decrease of ‐% over FY 2010 Debt to Equity Ratio N.A. N.A. 0.07 0.13 0.09 Debt to Capital Ratio N.A. N.A. 0.07 0.11 0.08• Earned an operating margin of ‐% in FY 2011, a decrease  Interest Coverage Ratio N.A. N.A. N.A. N.A. N.A. of ‐ percentage points over FY 2010 Efficiency Ratios Fixed Asset Turnover 19.89% 8.49 7.08 9.42 0.00 Asset Turnover ‐29.57% 0.87 1.24 1.26 0.00 Current Asset Turnover Current Asset Turnover ‐21 00% 21.00% 1.66 1 66 2.11 2 11 1.97 1 97 0.00 0 00 Working Capital Turnover ‐21.12% 2.16 2.73 2.32 0.00 Capital Employed Turnover ‐34.38% 0.87 1.33 1.43 0.00 Improved Decline CYBER SECURITY MARKET IN INDIA 2012.PPT 19
  20. 20. Private: Domestic Company – Company 2 (3/3)Key Recent Developments SAMPLE  Description  News • Operates as a leading provider of Internet Security tools and is hailed as being the leader Operates as a leading provider of Internet Security tools and is hailed as being the leader  in z1 in India • Boasts of employing more than 450 people across 22 branches in IndiaOverview • Operates through a network of dealers and channel partners in more than 50 countries  across the global platform  • Has recently bagged the award of ‐ Award 2012‐2014  • Its products can be categorized based on the end users and primarily caters to home  ll d d users, small‐medium companies, corporate, ISP and OEMsProducts • Recently it has launched a mobile security suite for ‐ in Mar 2012 • Has also launched unique laptop tracker in case of laptop theft • Has been awarded the prestigious z2 operating system for its z3Certifications  • Z4, z5 and z6 are certified in multiple categories through z7 certification CYBER SECURITY MARKET IN INDIA 2012.PPT 20
  21. 21. Thank you for the attentionThe Cyber Security Market – India 2012 report is a part of Netscribes, Inc.’s Information Technology Industry Series.For more detailed information or customized research requirements please contact:Phone: +91 33 4064 6214 91 33 4064 6214E‐Mail: sales@netscribes.comFollow us on:About Netscribes, Inc.Netscribes, Inc.  is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of  , g g f g p y p p finvestment & business research, business & corporate intelligence, content‐management services, and knowledge‐software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes Inc. is a one‐stop shop designed to fulfil clients’ profitability and growth objectives.Disclaimer: This report is published for general information only. Although high standards have been used in the preparation,  Netscribes isDisclaimer: This report is published for general information only Although high standards have been used in the preparation “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes and prior permission is required for guidelines on reproduction. CYBER SECURITY MARKET IN INDIA 2012.PPT 21