Recently, 12 LED-related listed companies released third-quarter performance forecasts, which showed a sharp increase year-on-year. The performance of many leading listed companies surged. Among them, Foshan Lighting, one of the domestic lighting leaders, experienced a surge of 281.4% in the first three quarters, reaching 280 million. Leading Liard and Zhouming Technology's net profit in the first three quarters increased by 50%~70% and 31%~41% respectively; the leading company of the packaging company, Mulinsen, revised the previous three quarters performance forecast from 192 million to 212 million. To 280 million to 325 million, an increase of 14% to 30% year-on-year; one of the leading LED chips, Huacan Optoelectronics, the net profit in the first three quarters soared 12 times to 120 million to 148 million.
In addition, in the LED industry, the release of the first three quarters of performance forecast, net profit increased significantly year-on-year, Alto Electronics increased by 261% ~ 309%, Lianjian Optoelectronics increased by 50% ~ 70%, Abbyson increased by 16% ~21%, Lehman shares increased by 25%~45%, Jufei Optoelectronics increased by 35%~65%, Dongshan Precision surged by 180%~220%, and Ruifeng Optoelectronics increased by 65%~85%.
Such a large number of LED company performance forecast surged year-on-year, clearly verifying that the overall profitability of the LED industry has been greatly improved, the overall industry supply and demand pattern is undergoing fundamental changes, reiterated a strong concern about the proposed LED industry has great opportunities.
We reiterate our strong interest in suggesting that the LED industry has great opportunities. LED upstream chip end: After 15 years of shuffling, the backward chip production capacity has been phased out. Taiwan's leading crystal power has shut down 25% of production capacity at the beginning of the year. Samsung has also cut production several times. At the same time, domestic government subsidies began to shrink significantly in 16 years. The expansion has dropped sharply. Therefore, the price increase of some products of the chip has exceeded 15% this year. The downstream domestic ban will increase the demand for LED lighting by 60%. The small-interval LED will grow by 28%, and the gap between supply and demand will reach 50%. From the perspective of supply and demand, the overall LED industry supply and demand structure has been reversed and improved, and the secondary market has low attention and there is a large expected gap.
Chip end: Leading companies continue to be fully productive. In the fourth quarter, the off-season is not weak. Orders have been placed at the end of the fourth quarter. It is expected that some product prices will still increase, and the performance is bound to exceed expectations.
We have been paying close attention to industry-level exchanges recently. LED chip chips such as Sanan, Huacan, Aoyang and many other LED chip companies are already full or almost close to full production. Some enterprises have been producing since June. And Taiwan's chip leading company Jingyuan Optoelectronics also said that due to the demand for quaternary LED, LED backlight, security monitoring, smart phone flash, car products, etc., it has already been fully produced since the end of the second quarter.
At present, the supply and demand structure of the LED chip is tight, and it is expected to last for 1-2 years. The main reason is that after 15 years of reshuffle, the backward chip production capacity has been phased out. At the beginning of the year, Jingdian shut down 25% of production capacity, and Samsung also announced a reduction in production. The gradual withdrawal of subsidies has also greatly reduced the disorderly expansion of domestic LED chip production capacity.
Therefore, the supply and demand structure at the beginning of 2016 has been flat, so the price of LED chips has stabilized at the beginning of the year. And because the leading companies such as Mulinsen and Guoxing Optoelectronics have continued to expand significantly in the second quarter. Among them, Mulinsen's 2.3 billion raised funds were put in place for the expansion of three packaging projects, and the expected expansion rate was 44.5%. After the expansion, the output exceeded 35,000 KK/month. Guoxing Optoelectronics announced on October 11 that it was the third time in the past 12 months. Expansion is expected to increase production by more than 20%. Therefore, industry insiders said that demand growth on the chip side is expected to exceed 20%.
The demand for lighting and small spacing was strong. The performance of Foshan Lighting, a leading lighting company, surged by 281.4%, and the performance of small pitch leader Lia De increased by more than 50%.
Reflecting the demand for downstream LED applications is extremely strong and will continue for the next 3 to 5 years. According to the DIGITIMES data, the penetration rate of LED lighting in 2015 was only 27.2%, and since October 1st, the domestic “ban†has prompted LED lighting to further accelerate the replacement of incandescent lamps, which will drive 60% of domestic LED lighting demand.
The indoor and outdoor small-pitch LED market continues to be hot, with more than 140 billion demand in 16 years, and there will be an additional demand of nearly 40 billion per year in 17-18 years. The demand for small-pitch LEDs will increase by 28% annually, while the current small spacing LED production capacity is about 70 billion, and the gap between supply and demand is 50%.
Focus on the LED industry chain sector opportunities, paying special attention to the performance flexibility opportunities of LED upstream chips and downstream applications.
Upstream chip manufacturers are at the core of the LED industry chain. The main listed companies are Sanan Optoelectronics, Huacan Optoelectronics, Silan Micro, Ganzhao Optoelectronics, and Aoyang Shunchang. Aoyang Shunchang recently announced the second phase of expansion. It is expected that the second phase capacity will be tripled from the first phase capacity to 800,000 pieces per month. The leading companies in the LED midstream packaging chain include: Mulinsen, Guoxing Optoelectronics, Jufei Optoelectronics, Hongli Zhihui, Ruifeng Optoelectronics, Dongshan Precision; Mulinsen package faucet capacity can exceed 35,000 KK / month, National Star Optoelectronics expansion for the third time in 12 months, small spacing capacity has reached 800kk / month, only this Yu Mu Linsen. Jufei Optoelectronics benefited from the recovery of backlight LED demand. The growth rate of the third quarter report is expected to be 0~30%, and it is expected to continue to exceed expectations in the fourth quarter.
The leading companies in lighting and application are Foshan Lighting, Sunlight Lighting, Op Lighting, Snowlight, Dehao Runda, Mingjiahui, and Changfang Group; Foshan Lighting's 3 quarterly report surged 281%, and Sunlight's LED revenue increased in the first half of the year. The speed reached 40%, and the sales growth rate was 60%. At the same time, the price of LED bulbs has basically stabilized, reflecting the continuous growth of LED lighting demand. The industry expects to maintain a growth rate of more than 20% in the next 2-3 years. Leading listed companies will continue to benefit.
The small-pitch leading companies include Liard, Ai Biesen, Chau Ming Technology, Lianjian Optoelectronics, Alto Electronics, etc. The small-pitch market will continue to grow by more than 30% in the next 2-3 years, and listed companies in the industry will continue to grow rapidly.
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