LED chip giants of the transformation of the dark war

When the cake is very big, there will be a giant strong intervention in the eating; When the pie gets smaller, big companies adjust their strategies and look for scale markets again.

With the slowdown of LED lighting market growth, low-end lighting chip overcapacity, fierce price competition, how to face the price war? How to continue the competitive advantage in the industry? How to continue to maintain upward momentum and revenue growth? Sanan optoelectronics, huacan optoelectronics, aoyang shunchang, dry lighting optoelectronics and other leading enterprises firmly occupying the Chinese LED chip market, give different answers.

LED chip giants are accelerating their transformation

With the increasing concentration of the industrial chain, LED chips are also developing towards a trend of higher standardization and larger scale, which requires rapid and low-cost response to meet differentiated demands on a large scale.

In the highly intensive situation of scale winning, the Matthew effect of domestic LED chip industry is very significant. According to the statistics of qianzhan industry research institute, sanan optoelectronics has a high market share in China's LED chip market, accounting for 31%. Huacan photoelectric and aoyang shunchang were next, accounting for 24% and 16% respectively. Three companies have a 71 per cent market share. LED chip industry or enter a new round of mergers and integration.

With the increasing concentration of the industrial chain, LED chips are also developing towards a trend of higher standardization and larger scale, which requires rapid and low-cost response to meet differentiated demands on a large scale. For the LED lighting market growth slowdown, low-end lighting chip overcapacity has become a general consensus of chip manufacturers, LED chip giants are accelerating the transformation.

SAN 'an optoelectronics: production expansion + innovative technology research and development

At present, LED chip industry shows capacity transfer to the mainland. SAN 'an optoelectricity increases its share through production expansion + innovative technology research and development. Technological progress and scale advantage drive cost reduction, so as to offset the impact of short-term price fluctuations on gross profit rate.

As the leading enterprise in LED chip industry, SAN 'an optoelectronics currently has a theoretical monthly production capacity of more than 3 million pieces (equivalent to two inch pieces). However, big manufacturers such as SAN 'an optoelectronics have also been hit by the industry, with both revenue and net profit falling last year, which continued in the first half of this year. As of the first quarter of this year, SAN 'an photoelectric inventory reached 2.958 billion yuan.

In terms of scale, SAN 'an optoelectronics has been the "unique" presence in the industry, but its expansion of capacity is still continuing. At the end of 2017, sanan invested 33.3 billion yuan in semiconductor related industry projects, which were still under construction. The sales revenue reached about 27 billion yuan the year after the production was reached. And its 12 billion yuan Mini/MicroLED industrialization project in wuhan also started on July 29.

With the advantage of consolidating the main business, SAN 'an photoelectric has arranged three new businesses prospectively around LED: MiniLED MicroLED, LED car lights, and compound semiconductor. On the one hand, sanan optoelectronics increases the iterative upgrading of chips in high-end fields such as intelligent lighting, plant lighting, medical, fishery lighting and port lighting, and at the same time actively promotes the technical research and development and industrialization of Mini/MicroLED chips. On the other hand, efforts will be made to build emerging strategic industries, such as VCSEL, integrated circuit chips, etc. In the future, under the dual advantages of production capacity and technology, the market share of SAN 'an photoelectric will continue to increase and its position will continue to be strengthened.

Huacan optoelectronics: expand production + adjust product structure

Huacan optoelectronics is the second largest manufacturer in China, with a theoretical monthly production capacity of more than 1.78 million (equivalent to 2 inches). The company has made a good breakthrough in the strategy of driving high-end products. Sales and revenue of backlight, high-efficiency white light and flip products have increased significantly, especially high-efficiency products.

Affected by the industry cycle and the rapid release of production capacity of small and medium-sized manufacturers, the supply of ordinary white light chips exceeds demand, and the price declines, causing a greater impact on the operation of huacan photoelectric.

In this regard, huacan optoelectronics continues to choose opportunities to improve the company's overall capacity, continue to consolidate and expand the company's scale effect advantage, and through continuous research and development and strengthen cost control, continue to reduce the cost of the company's products, improve the comprehensive competitiveness of the company's products. In addition, the company is increasing efforts to develop large overseas customers, and actively undertake international capacity transfer, participate in international competition, expand the epitaxial wafer and chip overseas sales of flip chip products.

At the same time, huacan continuously adjusts the company's product structure, focusing on the layout of high-end products, such as small-spacing LED chips, Mini/MicroLED chips, high-efficiency lighting chips and backlight chips, etc., to reduce the proportion of the income of low-end products. Since going public, it has acquired yunnan lanjing technology and American meixin semiconductor company successively, expanding the industrial chain from LED epitaxial chip manufacturing to sensor and semiconductor fields, focusing on high-margin products, and transforming into obvious transformation.

In addition, huacan optoelectronics has increased investment in sensor field around meishin semiconductor, continuously developed new product lines, such as gyroscope and VCSEL, etc., to improve the revenue scale of sensor business and the competitive position in the market.

In order to enhance the ability to resist risks, the company forms an industrial alliance with upstream core suppliers and downstream core customers, and continuously expands the company's influence in the industry.