Domestic black power suppliers' net profit declines to switch to LED midstream to open up the industrial chain

Recently, TCL Group signed a "Joint Venture Contract" with Harvatek (Hong Kong) Limited, a wholly-owned subsidiary of Hongqi Technology Co., Ltd., a Taiwan-listed company. The two parties intend to set up a Sino-foreign joint venture company in Huizhou City, Guangdong Province, for the packaging of light emitting diode (LED) devices. Product R & D, manufacturing, sales and other services.

In recent years, the performance of most domestic color TV companies has continued to decline, and the industry has fallen. Ovid Consulting data shows that during the “51” holiday in 2011, the retail sales volume of China's color TV market was only 1.58 million units, which was 4.7% lower than the same period of last year. This situation is the first time in the past five years. Under the pressure of profit, black power manufacturers have turned their attention to the huge LED market and accelerated their layout.

At present, in addition to TCL, the domestic black giants Skyworth, Konka, etc. have also laid out, not only to participate in liquid crystal panel projects, but also extend the antenna to the field of LED chip epitaxial wafers. However, in recent years, LED packaging companies have frequently been attacked by foreign companies and Taiwanese companies, or face the crisis of reshuffle. At this time, it is still not known whether black-box companies can produce results in the LED field.

Black power enterprises preemptive layout LED to open up the industrial chain

According to the relevant person in charge of the TCL Group, the first year after the production capacity of this cooperation project reached 2 billion LED device packaging products, and the planned production value was 1.3 billion yuan. The production date of the later stage (testing and packaging) of the project is expected to be December 2011, and the full process production date is expected to be late March 2012. “We and Taiwan Hongqi Technology jointly invest in the R&D, manufacturing and sales of LED packaging products, which helps us to exert synergies, increase the core competitiveness in the LCD vertical industrial chain, and play an active role in the development of the photoelectric industry in the Pearl River Delta. "Li Dongsheng said on his Weibo.

Recently, with the gradual disclosure of the annual reports of home appliance companies in Shanghai and Shenzhen, the profitability of China's mainstream color TV companies has also been shown to people: TCL net profit of 433 million yuan, Changhong 671 million yuan, Konka 82 million yuan, Hisense 835 million yuan; and Gree Electrical appliances are 4.276 billion yuan, and many black giants are no match for a white power company. Under such circumstances, black-box manufacturers have sought to diversify their layouts and have moved to the LED market in an effort to open up the industry chain.

As early as April 2008, Skyworth has completed the equity participation in the LG D Guangzhou LCD module factory at a relatively low cost, and has recently built an integrated LCD module production line. In March of this year, Skyworth also achieved a shareholding in LG. D's 8.5-generation LCD panel production line in Guangzhou, in addition, Skyworth, Delta, and Delta Electronics have invested $600 million in LED chip epitaxial wafer bases in Zengcheng, Guangzhou, which has laid the foundation, and Skyworth began to implement LED backlight modules and LED applications in 2008. In the layout of other areas, Skyworth has basically completed the layout of the LCD TV industry chain.

Another black giant Konka is not far behind, and its shares of Ruifeng Optoelectronics won the China Securities Regulatory Commission on May 26th. The two sides cooperated on the research, development, and industrial applications of LEDs for large-size LCD TV backlights to achieve LED packaging technology. Large-size LCD TV backlight applications are closely integrated.

Industry sources said that this equity investment in the LED sector may bring a new source of profits for the first quarter of this year, with a net loss of 76.86 million yuan, and Shenzhen Konka, which has borrowed more than 1 billion yuan from OCT, a major shareholder.

Taiwanese-funded enterprises have a large market share LED packaging industry is about to usher in the reshuffle

In 2010, the total output value of LED packaging in China reached 27 billion yuan, a year-on-year increase of 35%. It is expected that this year will also continue the growth rate of 20%-30%, and the LED packaging market will develop rapidly.

With the efforts of black power companies to speed up the layout of LED fields, domestic capital has also flocked to LED companies. However, people in the industry claimed that in recent years, LED packaging companies such as Taiwan’s Everlight and Lite-On have shifted their production capacity to the mainland, while Everlight’s The scale is even the sum of the top four LED packaging companies in China. This makes the mainland counterparts feel pressure. It remains to be seen whether the black power companies' effectiveness in this field is effective.

A few days ago, Taiwan's Luyang Optoelectronics invested 100 million US dollars in high-power LED packaging projects formally settled in Nanchang High-tech Zone. So far, in addition to advanced electricity, Taiwan's eight LED packaging giants have opened factories in the Mainland.

The industry believes that with the active deployment of strong Taiwanese-funded enterprises in the Mainland, mainland LED packaging companies that are originally in the low-end, homogenized production, and in the price war will face greater challenges and can foresee the industry. The shuffle era is approaching.

The data shows that there are currently 1,500 packaging companies in China, with more than 40 first camps with annual sales of over 100 million yuan, and less than 400 second-tier companies with sales between 10 million yuan and 100 million yuan. About 30% of the company's total sales are less than 10 million yuan, which is far from the average sales of 1 billion yuan in Taiwan's top eight listed companies.

The reporter learned that the LED industry chain consists of three major components: upstream LED epitaxial chips, midstream LED packages, and downstream LED lighting applications. Technically speaking, the upstream chip production is the most difficult, the entry threshold is at least 100 million -200 million yuan, while the middle reaches of the LED packaging industry, the capital threshold is only tens of millions, so companies enter the LED industry to choose more packages than the upstream chip, this area Competition is therefore the most intense.

At present, one of the main measures for domestic LED packaging companies to cope with market competition is low prices, and some small companies even sacrifice their product quality.

Zhang Yulin, research director of China Investment Consulting Co., Ltd., said that in order to achieve efficient development, leading LED packaging companies in China must use capital market forces to acquire mergers and acquisitions to carry out horizontal and vertical vertical integration. Zhang Xiaofei, director of the LED Industry Research Institute of Gaogong, also publicly stated that if the LED industry shuffles, packaging companies should bear the brunt.

data

The LED industry chain consists of three major components: the upstream LED epitaxial chip, the midstream LED package, and the downstream LED lighting application. Technically speaking, the upstream chip production is the most difficult, the entry threshold is at least 100 million -200 million yuan, while the middle reaches of the LED packaging industry, the capital threshold is only tens of millions, so companies enter the LED industry to choose more packages than the upstream chip, this Competition in the field is also the most intense.