Interesting questions.
Hopefully interesting answers...
1.) Why hasn't the company been bought by a larger competitor?
Simply because the CEO, Bakshi, believes he can build a world class company.
In reality, Silent Witness (SILW), until very recently, has been an extremely tiny company that wasn't on anyone's radar screen. If the company continues its rapid growth, I believe that Bakshi would have a difficult time remaining independent. However, my understanding is that his sole objective is remaining independent and building value by dramatically growing the company.
2.) What is the estimate of the size of the overall market served by their products and at what rate is it growing?
The closed circuit camera business is booming, and various studies show the industry has doubled over the past four years.
The closed circuit television surveillance camera segment of the market (the segment in which Silent Witness participates), is roughly estimated at $500,000,000 U.S.
J.P. Freeman (an industry research group) has indicated that the closed circuit television surveillance camera market should continue to grow rapidly over the next five years. They believe the outlook is very strong because our underlying economic, technological and social trends (crime, security etc.), remain very positive for the industry.
My best guess is their industry is growing at the rate of 12% to 15% per annum.
3. How has Silent Witness performed?
Over the last four year (1996 to 1999), Silent Witness has increased its share of the U.S. market from approximately 4% to approximately 9%.
Hope this is helpful.
Deb
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