With a total investment of 4.59 billion, domestic display material factory announced expansion of production

In recent years, against the background of the accelerated restructuring of the global semiconductor display industry chain, the importance of the material link has become increasingly prominent. Especially as new display technologies such as OLED and Mini/Micro LED continue to penetrate, the demand for domestic substitution of key upstream materials continues to increase. From photolithography materials and polarizers to liquid crystal and OLED luminescent materials, domestic manufacturers are accelerating the construction of an independent and controllable industrial system through the "two-wheel drive" of technological breakthroughs and capacity expansion.

Against this background, new chemical material companies have also accelerated the pace of expanding the high-end display materials market. Yesterday (4/15) evening, Chengzhi Technology disclosed two investment plans in succession, with a total investment scale of 4.59 billion yuan, involving two major directions: the extension of the ethylene value chain and high-end optical materials, as well as the construction of R&D capabilities, demonstrating its strategic acceleration on the "materials + display" track.

Chengzhi Co., Ltd. plans to invest 3.901 billion and 690 million respectively to build two major projects

- Ethylene value chain extension and high-end optical new material projects

According to the announcement, Chengzhi Co., Ltd. plans to invest in the construction of the "Ethylene Value Chain Extension and High-end Optical New Materials Project" in Nanjing Jiangbei New District through Nanjing Chengzhi New Materials Co., Ltd. (Chengzhi New Materials), a wholly-owned subsidiary of Nanjing Chengzhi Clean Energy Co., Ltd. (Nanjing Chengzhi). The total investment is approximately 3.901 billion yuan, and the construction period is expected to be 2.5 years.

Judging from the project structure, the project clearly points to the upgraded layout in the field of high value-added new materials. Among them, the ethylene value chain extension project includes: annual production of 60,000 tons of n-propanol and 200,000 tons of methyl methacrylate (MMA); high-end optical new material projects include an annual production of 100,000 tons of polymethylmethacrylate (PMMA).

As an important transparent optical polymer material, PMMA (polymethylmethacrylate, acrylic) is widely used in liquid crystal displays, optical lenses, light guide plates, vehicle displays, LED lighting, and optoelectronic devices due to its high light transmittance, excellent weather resistance, and easy processing and molding. It is one of the key basic optical materials in the display and optical industry chain.

Chengzhi Shares pointed out that PMMA is divided into mid-to-low-end and high-end products. At present, domestic mid-to-low-end PMMA products are mainly used in consumer fields such as advertising light boxes, signs, lamps, bathtubs, instruments, daily necessities, furniture, etc., while high-end products are used in LCD light guide plates, radiation-proof PMMA, optical fibers, solar photovoltaic cells, optical discs, etc. With the development of LCD manufacturing industry and the increase in consumption of light guide plate materials, optical grade PMMA has become one of the most growing polymer materials.

Overall, this project is an important measure for Chengzhi to implement the construction of a complete integrated industrial chain in Nanjing and implement the "Chengzhi Version 2.0" strategy. At present, Chengzhi Co., Ltd. has deployed two sets of olefin production units in Nanjing, and it has become an urgent need to extend ethylene, propylene, butadiene and other products to the downstream industrial chain. The investment and construction of this project will help Chengzhi Co., Ltd. open up the extension path of the ethylene industry chain to high-end materials, and at the same time enter the high-end display and optical materials track, deepen the strategic layout in the field of high-end chemical new materials, and enhance the company's overall anti-cyclical capabilities.

-Qingdao Chengzhi Research Institute Project

In addition to industrialization projects, Chengzhi Co., Ltd. simultaneously promotes the construction of a research and development system. According to the announcement, Chengzhi Co., Ltd. plans to invest in the construction of the "Qingdao Chengzhi Research Institute Project" in the West Coast New District of Qingdao City through its wholly-owned subsidiary Qingdao Chengzhi Huaqing New Chemical Materials Co., Ltd. (Chengzhi Huaqing), with a total investment amount of approximately 690 million yuan. The institute will have a scientific research building as its core and supporting facilities such as organic synthesis laboratory, polymerization laboratory, materials laboratory, processing laboratory, office building, training building and dormitory.

From a strategic perspective, the goals of building the institute include: building a high-end new materials research and development platform, strengthening industry-university-research collaboration, and supporting the implementation of the "Sincerity Version 2.0" strategy.

Specifically, the institute will focus on R&D around key technical bottlenecks in the field of new chemical materials, which will help enhance the company's technology accumulation in the field of high-end materials and promote the process of localization substitution in the field of high-end new materials.

At the same time, relying on the industrial foundation and policy support of Qingdao West Coast New Area, the project will integrate universities, scientific research institutions and industrial resources to promote the transformation of technological achievements. Chengzhi shares emphasized that this project is an important support for its strategic upgrading and will enhance its independent innovation capabilities and core competitiveness.

Seeking a new growth curve amid performance fluctuations

Against the background of intensified cyclical fluctuations in the traditional chemical business, Chengzhi Co., Ltd.’s large-scale expansion of production is closely related to its performance fluctuations and business structure conflicts in recent years, indicating that the company is looking for a new growth curve through the layout of high-end materials.

According to the 2025 annual report, Chengzhi Shares has now formed three major business systems: clean energy, new chemical materials, and life medical services. Affected by weak downstream demand for bulk chemicals and cyclical price fluctuations of core products, Chengzhi Holdings achieved revenue of 11.028 billion yuan in 2025, a slight decrease of 0.35% year-on-year; net profit attributable to the parent company was a loss of 78.1427 million yuan.

In the face of changes in the industry environment, the management of Chengzhi Co., Ltd. proposed the "Chengzhi Version 2.0" strategy. On the one hand, by extending the downstream industrial chain, we can get rid of the price game of primary chemicals and move towards high-margin fine materials. On the other hand, we will seize the opportunity of domestic substitution, focus on high-end optical materials, ultra-high purity electronic gases and pharmaceutical intermediates that are in short supply in China, and optimize the product structure.

In the field of liquid crystal display materials, subsidiary Shijiazhuang Chengzhi Yonghua is said to be the world's largest supplier of TN/STN hybrid liquid crystal materials, the world's main supplier of TFT-LCD hybrid liquid crystal materials, and an emerging supplier of OLED display materials. Facing the opportunities in the new display market, Chengzhi Yonghua actively deploys the research and development of cutting-edge technologies and products, covering smart windows, dye liquid crystals, OLED materials, optical adhesive materials and other new display chemicals.

In addition, Chengzhi Yonghua also acquired 1,183 display material-related patents from Japan's DIC Co., Ltd., and made up for its technical shortcomings through the two major directions of "independent research and development + overseas mergers and acquisitions".

The two major investment projects this time are also a concentrated reflection of the further implementation of this strategy, indicating that Chengzhi Co., Ltd. intends to break through the growth bottleneck of traditional chemical companies and transform into a high-end new materials platform through the dual engines of "R&D + manufacturing".

Driven by the gradual recovery of the industry and the optimization of internal structure, Chengzhi Shares' performance in the first quarter of 2026 shows a positive trend. During the reporting period, the company achieved revenue of 2.836 billion yuan, a year-on-year decrease of 5.41%; net profit attributable to shareholders of listed companies was 233 million yuan, a significant year-on-year increase of 177.38%.

The profit growth in the first quarter was mainly due to the price recovery of core products and the significant improvement in the profitability of the new materials segment. It reflects that the high value-added transformation under the "Sincerity 2.0" strategy has achieved initial results, and to a certain extent, it also provides support for the launch of large-scale capital expenditures at this time.

The collective rise of domestic display materials industry

Looking deeper, Chengzhi’s expansion of production is behind the collective rise of China’s entire display materials industry. Currently, the global semiconductor display industry is in a critical period of technological iteration. Among them, OLED continues to expand its penetration in medium-sized fields such as IT and automotive displays; MLED is further implemented on a large scale in different application fields...

The development of advanced technology continues to put forward higher requirements for high-purity optical materials, high-performance polymer materials, precision optical component materials, etc. At the same time, as IT displays, vehicle displays, medical and industrial control screens, etc. accelerate their transformation to OLED and MLED, the demand for PI films, polarizers, liquid crystal materials, PMMA, etc. is increasing year by year. Against this background, domestic material manufacturers are actively accelerating breakthroughs from the two dimensions of technology and production capacity, in order to seize opportunities in the localization of the display industry and key materials.

At the technical level, domestic companies have gradually broken through the technical barriers of core materials such as liquid crystal materials and OLED materials through independent research and development and mergers and acquisitions (such as Chengzhi Co., Ltd.’s acquisition of DIC patents), and the localization rate has continued to increase.

In terms of production capacity, companies represented by Chengzhi Co., Ltd. have begun to deploy high-end material production capacity on a large scale and achieve large-scale supply capabilities through project construction, helping to improve the supply resilience and security of the entire display industry chain.

Looking only at the field of OLED materials, according to incomplete statistics from TrendForce Display, more than 10 projects have been signed, landed, started construction, put into production or increased investment amounts since 2025 and 2026. This reflects that domestic material factories are currently at a critical point in the transformation from "technological breakthroughs" to "capacity implementation".

In the future, with the gradual implementation of major projects, the layout of domestic enterprises in different materials fields will gradually be realized into performance. For the entire display industry, the rise of upstream material manufacturers will effectively reduce the costs of downstream panel manufacturers and further enhance the global competitiveness of China's display industry.

Against this background, TrendForce will hold the 2026 New Display Industry Seminar (DTS 2026) from April 22 to 23, and a special OLED summit forum will be arranged at the same time.

Representative companies from the OLED industry chain such as BOE, TCL CSOT, Visionox, and Luminan, as well as senior analysts from TrendForce, will attend the speeches, focusing in depth on key topics such as the evolution of the large-generation OLED industry, IJP OLED technology development, technological breakthroughs in domestic OLED materials, and ViP AMOLED technology solutions, to grasp the future direction of OLED. The forum is rich in content. Click on the image below to register and participate for free.