Hongguang lighting landing gem market share or price guarantee

As China LED backlight products market in small segments of four, LED lamp manufacturer Hongguang Lighting Co. Ltd. to follow the "listing trend", in June 23rd, submitted to the HKEx gem listing application, as the sponsor of high financing. Over the past two years, the production material price decline and other favorable factors, Hongguang lighting profitable, however, LED lighting industry has always been competitive, to rival the response from Hongguang lighting at home and abroad, listed on the gem of the Hongguang lighting is still under pressure.

It is reported that Hongguang lighting since 2010 in Guangdong Province, mainly engaged in the design, development, manufacture and sale of LED lamp. LED lamp is the core component production LED backlight products, different specifications of the LED lamp can be used for production of LED backlight products, the products are often used as a light source and intelligent mobile phone screen LCD tablet computer panel. By virtue of LED product development experience, from the beginning of the end of 2013 to Hongguang lighting LED lamp production development and sales of LED lighting products.

Customers, production of different specifications of the Hongguang lighting LED lamp sales to LED backlight products, LCD panel module and electronic products manufacturers and China Trading company. On the other hand, LED lighting products sold to a customer in Australia and a China Trading company.

Performance by the production of materials and industry demand

Smart finance learned, as a producer, the production cost greatly by Hongguang lighting production volatility in raw material prices and influence. The raw material for the production of LED lights and LED lighting products mainly include LED chip, support and gold.

Hongguang lighting depends largely on Chinese suppliers at competitive prices to provide a variety of main production materials stable and reliable. Once the production material prices have any fluctuations, Hongguang lighting may not respond in a timely manner. If the production material prices passed on to customers, Hongguang lighting products to lose their competitive advantage, thus affecting the profitability and operating performance.

But because of the improvement of production technology, production material prices in recent years are in decline, is undoubtedly good for Hongguang lighting. Smart finance access to that, LED chip LED lamp production costs accounted for the highest proportion, according to Alexa general advisory report, the average price of LED chip in the period from 2011 to 2015 showed a downward trend, the compound annual growth rate of minus 13.2%, resulting in an average decline in the cost of. The average price of gold wire and bracket of another important raw material in recent years is also in decline, from 2011 to 2015, the compound annual growth rate of negative 1% and 14%.

But these important raw material procurement costs, it is the largest part of Hongguang lighting sales cost. As of 2014 and the end of two, the annual cost of the purchase of about 82 million 700 thousand yuan and RMB 81 million 900 thousand yuan, respectively, the total cost of sales of about $90.1% and $90.3%, respectively.

Therefore, the past two years, Hongguang lighting performance is also good. For the two year ended 2014 and in the year ended in December 31, 2015, the group received a profit of approximately $110 million and $118 million 700 thousand, and the profit for the year was approximately $5 million 400 thousand and $7 million 700 thousand respectively.

In addition, the performance is also affected by the impact of consumer demand. LED lamp general further production of small or medium-sized LED backlight products, and such products can be further used in intelligent mobile phone display, portable electronic devices, such as tablet computer terminal applications. Customer demand depends on the supply and demand of consumer electronics market and LED lighting industry. Therefore, the demand of LED beads may vary by the cycle of consumer electronic market and LED lighting industry.

Old four industry is still keen competition

According to Alexa general advisory report on sales in 2015, ranked fourth in the China LED backlight Hongguang lighting products market in small segments of all LED supply LED lamp lamp manufacturers, LED backlight products market in small segment is accounted for the overall China LED backlight products market of about 40.9%.

From the distribution area, Hongguang lighting is located in Guangdong Province, is also the domestic LED lighting industry big province, in 2015, Guangdong province's LED lighting products market share of more than 60% China LED lighting.

However, Hongguang lighting also faces intense competition. For Hongguang lighting, competitiveness depends on many factors, including competition from similar products in the market supply price, as well as competitors for the customer demand change reaction, and these factors are difficult to control, Hongguang lighting must constantly improve their own advantages and competitors to distinguish. Japan, South Korea and Taiwan in terms of technology and product prices, the number of domestic LED lighting manufacturers also.

The LED lamp and LED lighting industry competition, can not guarantee the first not said Hongguang lighting products facing downward pressure. If the competitor prices of its products, may follow the behavior of Hongguang lighting in order to maintain market share and competitiveness or reduce inventory levels.

It is worth noting that, have the advantage of autonomy Hongguang lighting development and production of downstream LED lighting products. In December 2015, the group's Zhuhai Hongguang for Chinese 14 utility model patent holders, but also China Information Industry Association LED branch member, the branch was established last year.

Public information, as of June 30, 2017 6 months, Hongguang lighting listing the use of the proceeds will be used to expand production capacity, expand the group's sales channels, to