“This year is the first year to replace traditional lighting LED penetration rate next year will be very large.” Sealand Securities analyst Fan Yimin said in an interview with the Securities Times reporter a few days ago.
It is understood that in several major areas of downstream applications, LED backlight display has become the mainstream of the market, in both areas to further enhance the space is small. Alternative to traditional lighting, LED has become the largest market in the coming years.
According to the statistics of National Semiconductor Lighting R & D and Industry Alliance, 2013 Application of LED output value reached 206.8 billion yuan, an increase of 36%, including general lighting output value of 69.6 billion yuan, accounting for 34% of the value of the application, the display has grown into general lighting LED of the most important fields of application. Hongta Securities pursuant to predict, in 2014, in 2015 China’s LED general lighting output will reach 115.4 billion yuan, 180 billion yuan, an increase of 66%, 56%.
This means that, after the 2009 ~ 2010 and 2011 ~ crazy expansion of the industry downturn after 2012, LED lighting market is opening hundreds of billions.
Alternative large Shinan reversal
Currently the world’s two lighting giant dilemma may explain more intuitive status of traditional lighting.
Due to traditional lighting such as incandescent bulbs, fluorescent tubes market is gradually shrinking, the European lighting manufacturers Osram has announced 7,800 job cuts, accounting for the total number of employees worldwide to about 22%. And another lighting giant Philips is officially announced in September this year, will have 123 years of lighting divestiture from the group, in which no lack of layoffs initiatives.
“We very much agree with this direction LED lighting to replace traditional lighting, and has been vigorously developing LED, why we have the phenomenon of the rapid development of LED business this year.” Foshan Lighting LED Operating Officer Division 陈文基 on Securities Times reporter said.
Foshan Lighting semi-annual report, the first half of this year the company achieved operating income of 1.528 billion yuan, of which the traditional lighting business achieved operating income of 1.106 billion yuan, an increase of 1.82%, weakness filling; and LED lighting achieved operating income of 420 million yuan, surged 341.1%. Chen Wenji is expected by the end of this year will reach one-third of LED business company’s total revenue.
Up to now, the traditional energy-saving lamps LED lighting against the last line of defense. But with the declining prices of LED lighting products, light effects and other advantages of the highlights increased year by year, as high energy efficiency, long life lighting products, LED lighting products to replace energy-saving lamps already have economy. According to the calculation of the industry, to a family with 10 4-watt LED lights and 10 15-watt energy-saving lamps to compare (4 watt LED lights and 15 watt energy-saving lights brightness equivalent) using 10 LED lights a years to save electricity for about 200 yuan.
“This year LED product prices very fast, cost-effective energy-saving lamps over the long. For example, in early 2012 LED T8 tube (a tube model) price 180 yuan, to the end of 2012 had fallen to 40 yuan; in 2013 this type of product and from 40 yuan dropped to 20 yuan; in 2014 had dropped to a few dollars from 20 yuan, “陈文基 said,” luminous efficiency is higher than the energy-saving lamps, the price is lower than the energy-saving lamp life. longer than CFLs. in fact LED lighting products has exceeded CFLs defense, and now many audiences still use energy-saving lamps can only be said to be a habit. “
Advantages of LED lighting has become increasingly evident, the Government also gave strong LED policy support. In early 2009, the ministry launched the promotion of energy conservation, promote industrial scale “city of ten thousand” LED demonstration project. The project is expected to guide the pre-pilot phase through to 2015 China will form a (Finance Court) mature marketing model, reaching 30 percent nationwide general lighting using semiconductor lighting, expected annual saving of 140 billion degrees, and the creation of one million or more jobs.
And another traditional incandescent lighting large main product is already into the elimination stage. According to the NDRC in 2011 “issued by China to phase out incandescent roadmap” China will be phased-out incandescent. Among them, from this year on October 1, prohibit the import and sale of 60 watts and above ordinary incandescent lighting; to starting October 1, 2016, banned the import and sale of 15 watts and above ordinary incandescent lighting. This means that after October 2016, basically to stop the sale and import of incandescent lamps.
Terminal market really needs
Familiar with the domestic LED industry development history of the people might also recall that in 2009 – during the 2010 LED industry has experienced a wave of surging investment boom, but then the 2011 ~ 2012, but the industry downturn, proved the existence of wound bubble . Today, the LED industry is some bustling scene, whether it is after the rapid development of a solid foundation, or past the haze to reproduce?
“The present situation and 2009 are essentially different.” Mitsuo Aurora Wang Jun, director of marketing for Securities Times reporter said, “That was upstream of prosperity, but the downstream simply not acceptable. This year LED fire, the terminal market is really there is a demand. “
It is understood that, beginning in 2009, under the national policy set to reconcile with the local government, local LED industry parks have sprung up. In particular, the upstream chip industry in the MOCVD (metal organic chemical vapor deposition) equipment purchase subsidies, subsidies for R & D investment and the amount of credits, under the approval of preferential support investment in factories and other special incentives and subsidies, the rapid expansion of production capacity. However, in 2011 ~ 2012 downstream applications demand remained weak, especially in the field of lighting applications did not appear and LED production capacity equal amplitude growth, industrial supply and demand imbalance causes the entire industry into the trough.
“In the beginning due to immature technology, LED luminous efficiency and lifetime of no stereotypes, plus many traditional lighting manufacturers at that time not to enter, the downstream demand for chip manufacturers are very small, so the upstream chip and the whole LED industry is mired in a slump . “Engineering LED CEO Zhang Xiaofei explained industry had suffered” because of the traditional lighting manufacturers, LED transition after all capricious, it will be a little slow on the time. but now the traditional manufacturers have come to realize that the big trend of , you do not have someone else to do. “
End-market demand in the upstream chip company’s financial report was especially evident. Three quarterly disclosure of three optical Recently, the company in 2014 1 to September achieved operating income of 3.478 billion yuan, an increase of 32.16%; net profit of 1.05 billion yuan, an increase of 38.02%. The company said revenue growth was mainly the company’s production capacity further release, sales increased.
The same as the LED chip enterprises HC SemiTek performance increase more alarming, the first three quarters of this year, operating income 520 million yuan, an increase of 153%; net profit of 74.8246 million yuan, an increase of 738.85%.
Rapid growth in the last round of investment boom, and to survive the downturn in the chip industry leading three safety optoelectronics, it is clear that history has a more profound understanding. “In fact, in 2009 and 2010 demand can not say bad, but too many people coming in, there will always cause the market’s ups and downs.” Sanan Optoelectronics stakeholders on the Securities Times reporter said, “Now the LED upstream competition is fierce However, the upstream operations involving MOCVD equipment, technical content and higher capital requirements other than chain link. Meanwhile, after the last round of expansion, the government also learned that the chip industry’s technological barriers and barriers still relatively high, so the Government will support enterprises now have a choice when the future of the LED chip industry fight is the technology and scale. “
“Boom of the LED industry ultimately depends on penetration lighting field, because this infiltration process is an irreversible process.” The source said.
Behind the prosperity of brutal competition still
Where there will be a bright shadow, LED light for humanity in this industry can not be an exception.
Essentially, LED is a semiconductor diode technology model, the business model is consistent with the silicon semiconductor. This means that, with the growing penetration of LED lighting, traditional lighting industry attributes will change.
Sealand Securities analyst Fan Yimin that since the main raw material of the LED chip and LED lighting driver IC chip is a semiconductor, which makes the property from the original class lighting products to the consumer electronics hardware change.
“Consumer electronics industry to follow Moore’s Law, the enterprise’s production cycle, the inventory cycle, management ability, technical skills are put forward higher requirements. Did not adapt to this changing business will be eliminated.” Fan Yimin said that from the development cycle of the semiconductor industry law, the concentration of market share will eventually be higher. “In other words, there are many small companies will be killed.”
According to research statistics, as of 2013 the domestic LED enterprises has reached nearly 30,000, mainly focused on the Pearl River Delta, Yangtze River Delta region. Among them, gathered in Shenzhen as the center of the Pearl River Delta region of the LED business for about 20,000, accounting for over 70% of the total LED enterprises throughout China. Recent burst of the “Phoenix Light Legend” and “Linden Lighting” Boss foot event, perhaps the industry attribute change, the SMEs survive the storm of more than a footnote.
It is understood that the two companies are located in the city of Zhongshan City, Guangdong lighting, which is also due to the legendary phoenix light to hire the “Phoenix Legends” as a spokesperson and is quite well known in the industry. In late October, the two companies have lost contact with the boss broke the news on foot.
“LED lighting industry as a whole is up no problem, but now rush to the more internal in the shuffle stage, especially small and medium enterprises do not have the scale, mostly by low-cost originally hit the market, built on the basis of rapid growth top of receivables risk, easy to go wrong. “Zhang Xiaofei, said.
Wang admitted that this year’s hot LED market, the basic large enterprises enjoy, small business is still very hard. “Small manufacturers do not have the channel itself, the main path has basically been the top ten brands in the hands of the manufacturers, so we can only rely on the price.”
“Next year in May, June there is a wave foot peak, industry concentration will certainly be getting higher and higher.” Chen Wenji think, “This year we called it consumes years, we have to bite down profits, to see you integrate upstream resources the ability to how strong profit margins can consume much. after a strategic stalemate this, starting next year, the follow-up force over the transition from traditional lighting companies will gradually be reflected, go faster. “
Brutal competitive situation is not unique to the downstream industry. Although the upstream chip industry has the financial and technical barriers, allowing new entrants temporarily discouraged, but due to the size of the property in the electronics industry dictates, so that the upstream more prone Hengqiang, the bigger the situation.
HC SemiTek remind investors in three quarterly, in order to compete for market dominance, market prices once again appeared in the short term irrational competition in the state still can not be completely avoided, the company will also face the risk of profitable product prices continued to decline due to falling. Hangzhou Silan Azure general manager Jiang Zhongyong is that now there are 20 or so domestic chip manufacturers can survive after 5 years only about five.
Midstream packaging field is not optimistic about the future of the industry in an industry. Based on the principle of the smile curve, smiling at both ends of the curve is the highest part of the added value. In the LED industry, the smile is located at the left end of the commanding heights of industry chain equipment manufacturing industry, while the other end is to have a smile curve brands and channels, that have application vendors client resources.
This means that in the middle of the packaging industry, not only within the industry will be faced with competition, will face squeeze from the upstream and downstream industry chain. According to Engineering LED forecast to 2018 from the current package of more than 1,700 companies dropped to about 700, the industry is facing many companies may be acquired or go bankrupt.
According Hongta Securities statistics, from 2013 until the beginning of September this year, A-share listed company has initiated LED 26 M & A events. According to the analysis, the current LED industry M type to horizontal merger, the main purpose of mergers and acquisitions is through mergers and acquisitions can complement each other, with strong competitiveness in some aspects of business, the main business bigger and stronger, thereby expanding the market share.
“For such a large number of businesses overall LED industry, merger integration can only occur very few, most still had to quit.” Xiaofei said.
Intelligent LED lighting into the potential market
LED lamp longevity might be a double-edged sword. Due to the long life, natural damage caused by the inevitable replacement market is not as huge conventional lighting. After the traditional lighting market is an alternative to complete, LED will be used where? This is a problem faced by the entire LED industry. In recent years, the rise of intelligent lighting, and perhaps will bring new opportunities for the LED industry.
Intelligent Lighting category belongs smart home, smart home is considered to be the future even beyond the smartphone equivalent amount of a market. In recent years, the boom in smart home, smart lighting is also heating up year after year, a large number of companies competing to enter, trying to slice.
Abroad, Philips, GE and other international giants have launched new smart lighting bulb, look for the transition direction. Domestic enterprises, not only lighting companies and LED industry chain enterprises into which even Jingdong and millet such Internet companies have begun to play “cross.”
“LED biggest benefit is that each lamp beads can be controlled individually, you can use the phone to control the brightness and color changes. This is probably the next biggest market lighting applications.” Mitsuo Aurora, said Wang Jun, director of marketing.
Philips Hue is the star product of intelligent lighting market. It is understood that this product not only dimmable, color, and can be customized by end iOS or Andriod software on demand. Meanwhile, Philips latest smart lighting software platform, it enables users to complete different scenarios intelligent product control, outdoor and indoor LED lighting devices connected at any time within the system.
In recent years, the increasing expansion of the territory of millet also lonely, in mid-October this year, has released four smart home products, among them one called Yeelight intelligent lamp lighting products. In related news, Yeelight is an intelligent lighting start-up companies, and completed early this year A round of financing, millet is the main strategic investor. According Yeelight founder Jiang Zhaoning revealed that this bulb is the result of cooperation with millet customized, quite a bit “for small Mitt” means only supports networking to complete the operation by controlling the lamp millet router.
China Merchants Securities analyst Huang Yu said, the essence of intelligent lighting electronics and networking, not only can achieve intelligent control lighting system, automatic adjustment of the basic functions and scene lighting, but also an entrance to the Internet, thus derived more high value-added services.
It is worth mentioning that, although the future looks very bright intelligent lighting, but currently existing between the various parts of the intelligent lighting system, the control platform, control protocol to source products, because there is no uniform product standards, resulting in product presentation dispersed technology, fragmentation characteristics. Only in terms of control protocol, the current market there is WiFi, Bluetooth, ZigBee and NFC and other types of control platforms with Apple, Android, etc. to choose from. Clearly, the future of intelligent lighting still needs collaboration of the whole industry chain.
Three quarters of the overall performance of the company for the better LED
Up to now, A-share listed companies, three quarterly LED has been released. From the data published three quarterly look, LED listed companies announced the first three quarterly reports no major discrepancy with the previous notice, most of the enterprises operating income, net profit increased significantly; only a few enterprises have revenue growth, net profit fell case, LED industry as a whole for the better.
Data show that four upstream chip companies today have all been disclosed three quarterly. Where HC SemiTek earnings growth is more alarming, the first three quarters of operating income 520 million yuan, an increase of 153.08%; net profit of 74.8246 million yuan, an increase of 738.85%. Chip leader Sanan Optoelectronics achieve the first three quarters of this year revenues 3.478 billion yuan, net profit of 1.045 billion yuan.
Chip manufacturing companies, dry according to optical become the only company in the third quarter corporate earnings growth is negative, the company explained that the decline in performance during the reporting period the company’s new plant put into use land, depreciation, cost increases as well as blue and green LED and other costs due to increased project planner, another increase marketing efforts also led to increased costs.
Midstream packaging industry remained stable earnings growth, but overall, slightly less than the upstream and downstream, it also reflects the increasingly competitive field of internal and external competitive environment to some extent. Which Ruifeng power and Mason Technologies earnings growth is negative, the rest of the companies holding 30% to 40% earnings growth.
LED downstream applications perform well. In the semi-annual report of the company have been disclosed, only rectangular lighting a family company earnings growth appears to be negative. Subdivision, the display industry’s profitability to be good compared to many of the lighting industry. Industry analysts believe that the traditional lighting business fell significantly this year, dragged down the company’s overall performance lighting.
Abby is the only one so far this year newly listed LED companies. Since August 1 listing, Abby’s stock rose 207%, is this a big bull stock. Abby three quarterly show, 1 to September 2014 Abby consolidated revenue 710 million yuan, an increase of 43.13%; net profit of 110 million yuan, an increase of 31.69%.
Abby said the main reason for changes in performance, the report period, the Company further strengthened marketing efforts, continued good sales. Display small spacing Series product line continuously enrich, product quality, performance was highly recognized by the market. 1 to September 2014, the company closely spaced series of products to achieve operating income of about 110 million yuan, an increase of about 230%.
