LED Industry Hengda pattern will determine the price of the product competition to return to rational

Autumn September, the news of raw material prices in the LED industry rumors. From the largest domestic chip companies to Xiamen Sanan optoelectronics XinDa, and even packaging giant chip packaging manufacturers, Linsen came up signal products. The manufacturers are given the price adjustment reasons, without exception, because the price of raw materials and labor costs and other factors. In fact, since May across the Strait EPISTAR announced this year prices, the major domestic manufacturers had to try. For chips and packaging materials prices, the industry have applauded, and want to follow up. More professionals said that the price is due to normal market rules, indicating that the LED market competition is gradually returning to reason. , chip packaging manufacturers collective price in May this year, the price of the chips EPISTAR fired the first shot, the blue LED prices will raise 15%. Then, three Huacan, other chip manufacturers have also conducted a price adjustment. By the end of August, LED chip, packaging enterprise is collective price, Xiamen three part of small and medium size product prices go up 10%, started in August 25th; amp photoelectric, photoelectric XinDa and Linsen RGB beads have increased 5% price, since the beginning of September 1st implementation. Three optical price adjustment letter shows that raw material prices bottomed out, of which gold (up more than 27% year), the substrate (compared to June rose 30% above); at the same time because of the small power small chip size, the BEOL consumes a large amount of sorting and testing capacity, unit labour cost increases, resulting in back end a sharp decline in output process. Now for some small and medium-sized products prices rose 10%, and in August 25th began to implement. In the Linsen price adjustment notice, due to changes in the market, resulting in product costs continue to rise, in order to collaborative production development of both sides and maintain good business relationship, according to the actual situation of raw materials prices. The principle of mutual benefit, is scheduled for September 1, 2016 RGB display lamp price raised 5%. XinDa photoelectric price adjustment letter shows that by the upstream chip and support prices rose sharply (generally above 10%), plus labor costs continued to rise, especially on the company's production of RGB lamp in the price increase 5% basis at present. Price adjustment since September 1st implementation. The price adjustment, including Fujian XinDa, Guangdong XinDa, An Puguang, Xiamen XinDa and other four subsidiaries of the product, and the price range of 5%. The main reason of price adjustment manufacturers given is due to the recent various raw materials and labor costs, the price has exceeded the cost accounting, in order to raise prices and profits remain. From the manufacturers can also be seen in the letter of price adjustment, the recent period, the sapphire substrate for LED raw materials, aluminum substrates, gold, etc. have varying degrees of price increases. Sorting through the major manufacturers issued price information is not difficult to find, at present the price of products are LED display chip and package products, especially small pitch products. Wang Fei, a senior analyst at LEDinside believes that small spacing LED display has entered the market growth, the market is rapidly expanding. Downstream demand and technological progress will lead to a small space between the rapid growth of packaging and chip consumption. In his view, the display and backlight packaging products will be driven by the demand for small spacing screen, there will be some room for price increases, while the lighting package will be facing upstream and downstream extrusion." Prices decline, profits bottomed in fact, LED chip, package and other product prices in recent years all the way down. In the recently held 2016 Strategiesin Light (SIL) and LEDShow conference, senior analyst Stephanie Pruitt said the incredible price decline has led to a decline in the packaging LED market revenue. Pruitt pointed out that the second half of 2015, the power LED prices dropped by 30% to 40%. High power LED affected by this small, but still decreased by 20% ~ 30%. Pruitt believes that a substantial price decline in lighting and backlighting applications is the main culprit, as LED shipments continue to climb. This is also reflected in the semi annual report released in recent major enterprises. August 20th, poly fly photoelectric released semi annual report in 2016. People are mixed, the company's revenue in the first half of this year, a substantial increase of 57.32% to $655 million, net profit fell by 12.56% to $59 million 414 thousand and 400. In constitute the main business table, Jufei LED lighting product gross margin particularly interesting, the product revenue was 74 million 109 thousand and 600 yuan, 67 million 141 thousand and 200 yuan operating costs, gross profit margin of only 9.4%. Excessive competition is fierce, is already a hot trend in LED industry norm, "injured" not only Jufei a package, leading LED application (including 2015 Linsen lighting and other products) of the gross profit margin of only 7.17%. But this year our semi annual report has not been disclosed, the current gross margin to also can make nothing of it. In addition to the implementation of double main industry of Lehman photoelectric, the first half of 2016 the company achieved operating income of 250 million yuan, an increase of 49.41% over the previous year; the sports resources to achieve sales revenue 25 million 820 thousand yuan, an increase of 77.15%. But it is worth noting that the Lehman photoelectric main business LED, and related packaging products, lighting products and display products, although they all have different rate of growth in revenues, but gross margin fell. LED business, for example, in the first half of 2016 to achieve revenues of 220 million yuan, gross margin was 29.25%, compared with the same period last year dropped by 4.06 percentage points. The same is true in the upstream chip industry. According to the three optical semi annual report