LED industry to expand production busy chip grab market

LED market is an indisputable fact that the real problem but the industry production surplus is also unavoidable. Nearly two weeks LED leading enterprises have launched the expansion plan, the industry is worried. Judging from the current situation, compared to the downstream packaging field, the situation is still difficult to solve the upstream low-end chip overcapacity.

An optoelectronic push capacity doubling plan

Since late May 27th, Sanan Optoelectronics (600703) launched a fund-raising 3 billion 300 million expansion project LED plan after nearly two weeks, overweight LED a few companies, even not previously involved in the LED industry companies want to share "".

According to the plan, if Sanan optoelectronics given by the smooth implementation of the program, the LED chip production capacity will add a times. At present, the company has 2 inch piece of MOCVD equipment 141 units, an effective capacity of about 130 units, in addition to a small number of technical equipment has been fully completed. The scheduled increase in the planning of the new LED epitaxial film production capacity of 1 million 223 thousand (to 4 inches epitaxial film calculation), blue, green chips 25 billion 614 million. According to the state securities estimates, the company will add 100 new inch piece of MOCVD equipment (production capacity of about 54 times the machine), capacity doubled.

In May 30th, a total investment of over 1 billion yuan in Shenzhen Jiawei lighting LED application project held a signing ceremony. The project by Jiawei shares (300317) and an optoelectronic joint construction, covers an area of 300 acres, mainly engaged in research and development, manufacturing and sales of LED application products.

A week after the suspension, Australia Shunchang (002245) June 3rd evening release set by the program, intended to raise funds not exceeding 512 million yuan, to invest in LED wafer, chip industrialization project and add liquidity, the LED project total investment 808 million yuan, plans to invest 400 million yuan fund-raising.

LIAN opto Electronics (600363) on June 2nd evening also announced the acquisition of Shanghai Mao Mao, a 51% stake, overweight LED business in Shanghai and its surrounding areas of industrial and market layout.

From the property to the real estate industry, the main business downturn, HEDY holding (002027) recently chose LED business as a new growth point. HEDY holding the evening of June 3rd announcement that the company intends to set up a joint venture with natural Sun Debing subsidiary of Guangzhou seven photoelectric Co., engaged in the application of LED products, expanding the company's business scope.

Non-listed company, the expansion of the enterprise is not a minority. For example, a total investment of more than 2 billion yuan in Shenzhen tiandian photoelectric technology LED package project, recently in Fujian Anxi formally signed a framework agreement. Tiandian photoelectric LED package project covers an area of 150 acres, mainly engaged in research and development, manufacturing and sales of LED packaging products.

Domestic manufacturers have started to expand the production plan, it is easy to associate with two years ago LED manufacturers in full swing to expand production scene. China's mainland LED manufacturers 2010-2011 massive expansion of production capacity, it is the leading cause of the LED industry over the past two years, a major factor in supply and demand imbalances.

Over the rest of the tour

Before the application of laser technology in the International Exhibition Center held in Shenzhen forum, Guangdong Optical Society honorary chairman, Zhongshan University professor Yu Zhenxin said in reference to the LED industry, on the whole, China's LED industry is losing money.

Professor Yu said that the actual situation of China's LED industry, an embarrassing situation. In the upper reaches of the LED industry chain, China's LED chip companies have been highly dependent on government subsidies and government orders. If the net subsidy factor, enterprise can not profit, even industry leader Sanan optoelectronics, is also not able to throw away the crutches to walk.

Midstream packaging and downstream applications have corporate profits, but also can not escape the old road made in China, mostly in the low-end market, or rely on oem. For the high value of the lighting field, the application of commercial lighting is still in the initial stage, especially in the country is almost entirely dependent on the government to promote, not to mention the application of the field of general lighting.

Overcapacity problem has always existed, but LED overcapacity is structural surplus. A LED manufacturer who told reporters that in the upstream chip field, low performance, small size chip overcapacity, while a large number of high-performance chips rely on imports. Downstream packaging, applications and other fields, although the fierce competition in the enterprise, the concentration is not high, but due to the gradual expansion of the commercial lighting market overcapacity situation is not serious.

In the packaging, application, last year, the company's capacity utilization is relatively low, 60%-70%, currently reached 80%-90%. Due to the rapid growth of indoor commercial lighting market demand, the industry trend is good, so even if the expansion of production, the short term do not have to worry about excess capacity, unless the company is eager to expand production.

The problem of overcapacity in the field of the chip is difficult to solve. Currently, the demand for LED in the field of display is not obvious, mainly driven by commercial lighting demand, while China's production of LED chips are mainly concentrated in the low-end, there are still difficulties in the field of lighting applications. At present, the enterprises are still at a loss of LED chip sales in China to seize the market, although the current full orders, but the leading enterprise expansion, will eventually push back the small business market.

Price war in the LED industry is not new, especially in the field of LED chips, the majority of domestic LED companies choose to sacrifice gross margin to open up the market. Industry leader Sanan optoelectronics as early as 2011 began to "throw money" action, low-cost strategies to capture the market, and the "price butcher" Elec-Tech appears, then let the chip market price war escalated.

An industry source told reporters that at present, the price of LED chip companies still