LED industry has three major changes, three optical depth of benefit

Sanan optoelectronics is a sustained to surprise the market of the company, the annual report of 2016 outstanding performance and 2017Q1 far higher expected results notice are showing domineering king.

From the beginning of 2016, LED chip industry presents three major changes: clearing capacity promote concentration increase, promote the rational price, supply and demand differences leading to benefit from trade reversal. Outlook 2017, LED chip link expansion to follow up, but was blocked in the preparation of the production cycle, there is a gap in the supply of downstream demand, the order boom can be expected. Chip industry in the last year after the reversal to achieve benefits, this year will continue to enjoy the LED market boom orders and prices double positive. Sanan optoelectronics as China market first chip manufacturers, the future will be the price as a tool to further enhance the market share in the production, distribution and technical level, the market were walking in the competition before the first quarter of the pre 45%-55% is just a starting point, the annual performance of high growth and subsequent growth of global LED giants will be the ultimate goal. In this process, the company layout advanced production capacity, Microled and other advanced technologies, automotive and other advanced applications, will further boost the development path of the giant.

After the winter, the LED industry showed a concentration increase, price rational, profit to the three major changes

LED (light emitting diode) is a semiconductor device that converts electric energy into light energy, with long service life, high light efficiency (up to 80% - 90%), no radiation, low power consumption, and the spectra of LED concentrated in the visible light spectrum, is mainly used for general lighting, display, backlight, decoration auto, lighting and other fields. Affected by the downstream backlight, display, lighting three applications driven by the market, the global LED market output showed a band growth. In 09, 10 years after the big size backlight fiery, LED lighting because of its energy saving and environmental protection, high luminous efficiency of the characteristics of the Chinese government to promote, promote the development of the industry. Under the policy support, China's LED lighting sector investment boom, and companies to buy epitaxial wafer production equipment MOCVD by large subsidies, as an important driving force for the growth of the global LED market.

However, from the beginning of 2014, the market demand for the suspension of the backlight, large-size Backlight Market by the impact of emerging OLED display technology, laptop backlight penetration has reached saturation. So far, LED industry ushered in a mature period, slow growth in output.

Lighting as the main source of demand for the industry so that the rapid growth of production capacity can not be digested. Chip manufacturers in 2014 305 new MOCVD devices in the beginning of the output in the year of 15, resulting in a widening gap between supply and demand, chip prices continued to decline. LED chip manufacturers in the downward trend in demand, can only take a price war to gain market share, the industry into the winter period.

By 2016, you can see the upstream LED chip industry has undergone three new changes. First, the ability to clear the market, industry concentration. Faced with the price war and the supply side of the attack, small chip factory can not transfer costs, can only reduce the operating rate, facing bankruptcy. From the perspective of the degree of concentration of MOCVD can be reflected from the side of the industry to enhance the concentration. Beginning in 2015, China's new MOCVD equipment is mainly dominated by large, well funded leading enterprises. According to China's industrial lighting network data show that in 2015, 5% of China's manufacturers have more than 100 devices, while the proportion of the following enterprises accounted for 10 of the company reached 44%. These small MOCVD equipment manufacturers, with models are mainly backward models, mostly zombie enterprises". After 2015 to 2016, the industry reshuffle, before the 49 machine in the following models in 2011 (converted into 54 machines) operating rate is low, has been phased out. Difficult to upgrade these models of small manufacturers in the trend of production capacity is difficult to survive.

While our local LED chip manufacturers, Sanan optoelectronics, HC semitek, Elec-Tech through expansion and integration continue to expand market share and achieve "left for the king" by leaps and bounds. In 2016, China's LED chip market top ten manufacturers accounted for 77%, three, EPISTAR and Huacan three chip manufacturers won more than half of the market share, the industry concentration increase.

The two is the rise of supply and demand, price differences tide. In the chip prices continued to slump, the price war down LED manufacturers profit era, starting from the first quarter of 16, the LED industry chain began to price increases. The reason is mainly due to the cost of raw material costs to improve the cost of packaging enterprises to raise prices in the first test. Since then, the front-end chip manufacturers in the rising costs, capacity clearing, small enterprises and the downstream application to eliminate the imbalance in the supply of demand driven by the beginning of the price of some products 10% - 20%.

Third, the fourth quarter, the upstream manufacturers continue to trigger a series of packaging and application companies to launch price increases. Last year's repeated price increases, on the one hand, it can be said is to promote the gradual return to rational pricing LED factory, on the other hand, also accelerated the expansion of chip manufacturers and packaging enterprises.

Three is the trend of leading benefit. 2015, China's rapid growth in LED chip production, to achieve an increase of 60%. However, behind the sharp increase in output growth is not optimistic, the weak demand in Europe and the United States and the industry's low price competition chaos, the price decline is also larger. The 16 year, LED chip industry needs to pick up, chip companies also hold high prices in the price of the flag, the price of return to rational, the market rose to $14 billion 500 million, the growth rate of 11.5%.

Benefit from the industry concentration changes, price increases and downstream demand to stimulate China's LED industry leading performance, an increase significantly. Calendar through the LED winter high-quality enterprises, and ultimately to carve up a new market