Looking forward to the development trend of LED display industry

In 2016, the LED display market demand value was 13.9 billion yuan, a year-on-year increase of 9%, and in 2015 it was a year-on-year decline of 7%. The main reason for the reversal is the stability of the price + the rapid growth of some areas of the display business. In 2016, the LED market was 58.9 billion, an increase of 6% year-on-year. Compared with 2014, it increased by 2% in 2015, mainly due to price and terminal demand factors.

The difference between the packaging and chip industries is that there are also international manufacturers. In 2016, the growth rate of mainland manufacturers was 8%, that of Taiwan companies was 1%, and that of international companies was 4%. In the future, the local market will continue to grow the fastest, mainly due to the expansion of LED display manufacturers in mainland China, and the technological gap will continue to narrow, especially in the small-pitch field, where the advantages of international companies will be eliminated. The future development of the industry is predicted. From 2015 to 2020, the industry has entered a period of reshuffle. The growth rate of 20%-30% in 2009 will hardly appear in the future. The compound growth rate of packaging in 2015-2020 will be about 6%, which is a flat development. .

The supply side is very tight this year, and some fields (small pitch) are blue and green, regardless of Sanan Huacan's order is twice the production capacity. The chip industry ushered in an inflection point. After the second half of 2010, chips were generally miserable, and finally ushered in a turning point. In the next two years, the bargaining power of chip companies will increase, while packaging companies will decline.

In addition, international manufacturers such as Samsung and Philips may reduce their production capacity, and the trend is to find foundries in China. Looking at the demand side: Take the example of indoor LED display screens. In the past, the international market (India, Russia) required that a LED screen would purchase a box and go back to assemble it. Now the LED module, power supply, and control system are imported and assembled locally. , because the development of the local manufacturing industry starts with simple assembly, and it is difficult for high-end industries such as chips to achieve self-sufficiency in a short period of time. It is predicted that in the future, there will be a grouping phenomenon in the industry, such as the Sanan system, the Huacan system, and the Mulinsen system.

It is more difficult for other manufacturers to survive, which is the logic of the previous increase in industry concentration + leading powerhouse Hengqiang. LED emerged in China in 2000, and its rapid development was from 2009 to 2010, mainly driven by the backlight + display business. However, since 2014, the saturation of the backlight market has led to price declines year by year, mainly relying on the rapid penetration of the display business to support the growth of the entire industry.

Now we can see some changes in the whole industry, that is, the industry returns to growth. The industry has resumed growth. The industry overview in 2016 shows that China's LED display business exported a total of 16.4 billion US dollars in 2016. As the world's major OEM region, export data can reflect changes in demand. In 2016, there was no growth compared with 2015, and there was a downward trend (compared to 64% growth in 2014 and 16% growth in 2015), indicating that the growth of the industry was difficult to maintain due to the promotion of display business, and it entered a flat development period.

From the perspective of the supply side of the chip industry, the YOY of mainland companies in 2016 was 13%, and that of Taiwan was -2%, indicating that the domestic production rate has increased rapidly. The localization rate was 66% in 2014, 73% in 2015, and 76% in 2016. The localization rate has always been growing. In the past years, Taiwanese manufacturers had obvious technological advantages and were popular in mainland China. However, in recent years, the gap between domestic manufacturers led by Sanan and Epistar has been narrowing, and even surpassed in some product fields.

In 2017, mainstream manufacturers will still expand their production capacity, and the domestic production rate of chips will further increase in the future. On the other hand, the export rate was 8% in 2015 and 9.6% in 2016, and overseas markets are also being explored. In terms of industry concentration, the top ten manufacturers accounted for 77% of the market in 2016, which is a relatively high level. The top three are Sanan (29%), Jingdian (13%), and HC Semitek (8%). In the future, the concentration will further increase A state of ascension and the strong remain strong.

The localization rate continues to increase, reaching 66% in 2015 and 67% in 2016. The localization rate is lower than that of chips, mainly because international factories still have the absolute right to speak in high-end fields such as automotive and mobile phone flash lights, and the technical threshold is high. In 2016, the output value of mainland manufacturers was 29.5 billion, with a growth rate of 8%.

The industry concentration continues to increase, with the top ten cities accounting for 39% in 2015 and 43% in 2016. In terms of specific manufacturers: Japan's Nichia Chemicals ranks first in China's market share with 7%, followed by Mulinsen with 6.9%. Other international companies such as Philips still have a relatively high share, and local manufacturers such as Guoxing and Hongli can still rank in the top ten, ranking sixth and eighth respectively.

Small-pitch LED displays have shown rapid growth since 2014. The situation of major LED display manufacturers: Leyard has a compound growth rate of 70% from 2014 to 2016, and it exploded in 2016; Unilumin 80%; Absen 70%. The spacing is reduced by half, and the dosage is increased several times. .