Capital influx into the LED industry, shuffling quietly

"The ability of 1-2 billion output value to resist risks is far from enough. If it can become a listed company, it can not only make big brand influence, but also the company can grow bigger and stronger quickly." Li, General Manager of Shenzhen Lehman Optoelectronics Technology Co., Ltd. One of the things that Man Rail has been busy with recently is to push the company onto the GEM.

At present, the LED industry has entered a period of rapid development, and various funds have poured into this green field of “low carbon, energy saving and environmental protection”. With the deepening of competition, the listing financing has become bigger and stronger and has become a small and medium LED enterprise. The urgent need for development.

According to the reporter's understanding, Shenzhen is currently planning no less than 10 LED companies listed on the SME board or the GEM, like Lehman Optoelectronics. Wanrun, Bangbeier, Maoshuo Power, Lianjian Optoelectronics, Ruifeng Optoelectronics, etc. are in the leading position. A listing plan was proposed, and many other companies have completed the shareholding system transformation.

Rapid growth in output

In the interview, the reporter learned that at present, most LED leading enterprises in Shenzhen are full of orders, which are in short supply. Li Mantie told reporters: "The company's production capacity has doubled to meet the demand for existing orders. To do this, at least tens of millions of yuan must be invested in this scale." At present, Lehman's orders can meet at least one quarter of production capacity, and now the company's production line Starting 24 hours a day, still can not meet the demand for orders.

Gong Weibin, general manager of Ruifeng Optoelectronics, separated from Lehman’s wall, said in an interview that the company’s operations are entering a stage of rapid development. This year’s total output value is expected to increase by more than three times. “Our order this year is enough for a busy horse. year."

A sales manager of Wanrun Technology told the reporter that the company's order this year can be done in September and October. The company started out as a package and gradually entered the application fields such as lighting. The company's sales last year reached 400 million yuan. In 2008, the proportion of LED applications accounted for 30% of its total output, which accounted for 40% in 2009 and is expected to reach 50-60% this year. This reflects the rapid growth of the LED application market from one side.

According to the data provided by the National Semiconductor Lighting Engineering R&D and Industry Alliance, the sales value of China's semiconductor lighting industry reached 60 billion yuan in 2009, a year-on-year growth of more than 30%. China has become one of the fastest growing regions in the global LED industry.

The reporter learned from the Shenzhen LED Industry Association that the output value of Shenzhen's LED industry exceeded 20 billion yuan in 2009, a year-on-year increase of more than 30%, far higher than the average growth rate of 5% in China's lighting equipment manufacturing industry.

However, although China's LED output value has grown rapidly, but the domestic market has not yet fully launched, most of the packaging application companies' products are still export-oriented.

Industry

At present, the domestic LED lighting industry mainly focuses on packaging and downstream applications. Lu Qin, an analyst at Century Securities, pointed out that the LED lighting industry has great differences in the upper, middle and lower reaches. Upstream products such as chips are extremely difficult, high-difficult, high-input, and high-risk, while the barriers to entry in the middle and lower reaches are low and lack core technology.

"The investment threshold for upstream chips is 1-2 billion yuan, the investment threshold for midstream packaging is 10-20 million yuan, and the funding threshold for downstream application assembly is only 100-200 million yuan." Li Mantie said that Lehman entered in 2004. In the packaging industry, from the initial investment of more than 10 million yuan to the present, the total investment has exceeded 100 million.

Due to the low barriers to entry in the middle and lower reaches, the market prospects are promising, and a large number of private capitals have entered this field. A direct consequence of the large-scale entry of various capitals and the small size of enterprises is that product quality is difficult to guarantee, and the profit margin of the industry is rapidly shrinking.

“In 2008, the gross profit margin of the company's export products was 30%-40%, but the current gross profit has been reduced to 10%-20%. The main reason is that the inferior materials of the small factories have impacted us.” Wanrun Lighting mentioned above sales The manager told the reporter.

In fact, in the entire LED lighting industry chain, 60%-70% of profits are earned by upstream epitaxial wafers and chip companies, LED packaging and lighting applications only account for 10%-20% of the profit margin.

Shuffling quietly

The general manager of an LED packaging company in Shenzhen told reporters that the industry "has two or three companies coming in every day, and two or three companies are smashed every day." Although this statement is considered by some other industry to be somewhat exaggerated, they also admit that the industry is too hot, there are indeed many companies new, and many companies have collapsed.

Perhaps because of concerns about excessive competition in this industry, some companies are actively seeking listings, and they want to use the capital market platform to become bigger and stronger, while some companies are looking for opportunities for mergers and acquisitions when LEDs are hot.

"Upstream Taiwan's Jingdian, mid-stream packaged Yiguang, annual sales of more than 20 billion, these companies are rapidly becoming bigger and stronger after listing." Li Mantie revealed that Lehman is striving to become a business The first company to be listed in the LED industry. It is reported that in October last year, Shenzhen City held a LED enterprise GEM listing counseling, and more than 100 LED companies attended the conference.

In addition to the independent listing, some enterprises in Shenzhen with relatively mature scale and relatively mature technology have quietly become the “Xiangxiang” that many industries and venture capitales are vying to acquire. In July last year, Dehao Runda subsidiary Jianlong Optoelectronics spent 21 million yuan to acquire 60% stake in Shenzhen Ruituo; in January this year, Dazu Laser increased its investment in Shenzhen LED big screen leader Yuanheng Optoelectronics, holding 41.8 million yuan A 51% stake in Yuanheng Optoelectronics is deeply involved in the field of LED applications.

In the interview, Liu Zhen, general manager of Shenzhen Quantum Optoelectronics, told the reporter that the company is mainly engaged in the packaging industry. Although the company is operating well, in order to become bigger and stronger, it is looking for strong partners. If the conditions are right, the company may not even have to Holding".

According to public information, in the first half of 2009 alone, LED projects were launched all over the country, and the total investment budget has exceeded 20 billion yuan. In recent years, venture capital has invested more than 1.5 billion yuan in domestic LED companies.

While the industry is promising and a large amount of capital is entering, overcapacity is also threatening the industry. According to expert analysis, from the current project statistics and construction projects, LED production capacity will at least overdraw the capacity and market in the next three to five years. With the entry of international giants and powerful domestic listed companies into this market, a large number of domestic LED companies will face the risk of being merged or directly eliminated.

Obviously, before the market has started on a large scale, it will require a certain amount of financial strength to "squat". The industry generally believes that the LED industry will be a process of shuffling in 2010-2012, and those enterprises lacking financial strength and technical strength will be eliminated.

Enclosure

In the LED industry investment feast, Xie Yingxiang, general manager of Destada Optoelectronics Lighting Technology (Shenzhen) Co., Ltd. gave an exaggerated and worry-free data: "In the entire LED industry investment, 40% of laymen speculation, drunkards 40% of the intentions, 20% of the positions."

In the interview, the reporter heard more than once that some companies borrowed the LED industry and the local government to attract investment opportunities to “circle money and encircle the land”. "Some companies invest in this business, they are optimistic about the government's funds, optimistic about the land provided by the government; many projects provide support from the government is all-round, in fact, equivalent to the local government is doing." LED senior experts, stay in the United States The group is outspoken.

In today's booming real estate industry, the appreciation of land has made some people jealous. A number of industry insiders pointed out to reporters that a hidden purpose contained in some enterprise investment LED projects is "enclosure." The quick success of some local governments has given this part of the speculators a chance. It is reported that some local governments not only give land use rights, but also give land ownership. Enterprises can directly use the land as a mortgage to go to bank loans.

In the eyes of LED senior experts and Dr. Zhong Qun, the company may be more serious than the investment in polysilicon for some companies that do not care about the risk of blindly launching the chip project. "Because the photovoltaic industry does not have such a large technical bottleneck, the production process is all standardized. Enterprises invest money and purchase standardized equipment. At the very least, they can make products and judge that PV investment is overheated. It is not a big demand in the market. But LED Unlike PV, it is possible that companies will put money into it, and even the basic production process can't be mastered. Then the money will definitely be white." Zhong Qun said.

"At present, the most serious problem in this industry is that the investment companies have not seen the direction of LED technology development. Many enterprises are building the land first and building the factory first. They are still groping. They have not figured out how to break through the technology. In terms of epitaxial wafers and chips, this aspect is different from the application and must have its own technology," said Xie Suyun, director of Gaogong LED.

The enterprises and brands that an industry and market can finally accommodate are limited. In the process of industrial development and maturity, small enterprises and enterprises without core competitiveness may be eliminated. "The domestic LED industry is currently like a saline-alkali land. A small number of enterprises entering the front may survive, but most of them may eventually fall out." Zhuang Canyang, director of Everlight Electronics, said.

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