The research on the life cycle of emerging industries needs to pay special attention to the concept period and collapse period. The investment value and investment logic of the industry in different cycle stages are different. It is slightly different from the four stages of traditional life cycle: start-up, growth, maturity and recession. Due to its cutting-edge and technological uncertainty, the market often began to hype the concept in the early stage of industry development, but then it may fall into disillusionment for a period of time because the products can not meet the high expectations of the market, The life cycle of emerging industries can be divided into five stages: germination stage, concept stage, collapse stage, recovery stage and maturity stage.
Four dimensional financial indicators assist in the division of industrial life cycle. This paper comprehensively defines the industrial life cycle stage of the industry by combining qualitative and quantitative indicators. The qualitative aspects mainly consider the technical development stage, product maturity and policy drive of the industry, and the quantitative indicators are financial indicators. Quantitative indicators include: (1) operating performance: measured by the growth rate of net profit attributable to parent company and the growth rate of operating revenue; (2) R & D / expansion investment: measured by R & D expense growth rate, CFI / operating revenue and R & D achievement conversion rate (intangible assets / R & D expenditure); (3) competitive pressure: measured by cost rate (operating cost / operating revenue); (4) industrial chain status: measured by cash income ratio (CFO / operating revenue).
Most emerging industries are recovering. Divided by four-dimensional financial indicators combined with qualitative analysis, cloud computing and vaccines are still in the conceptual stage, basic software and 5g are in the burst stage, photovoltaic, wind power, lithium battery, medical devices, innovative drugs, artificial intelligence and semiconductors are in the recovery stage, and Apple’s industrial chain, display panels, games and computer equipment have entered the mature stage.
