LED packaging enters the era of

Nationstar Optoelectronics continues to promote a diversified enterprise development strategy based on "vertical integration of LED upstream, mid-stream and downstream", and has successively deployed upstream chips (Avilant, Nationstar Semiconductor) and downstream lighting applications, continuously increased and improved technology reserves, and consolidated and strengthened market share.

As the LED industry enters a critical turning point period, how will Nationstar Optoelectronics respond to future changes in the LED industry?

Q: Nationstar Optoelectronics is currently one of the largest small-pitch packaging companies in China. What other layouts will the company make in terms of technology, products and markets in the future?

Nationstar has been making research and development reserves for small-pitch packaging since 2011, and is one of the first domestic companies to carry out small-pitch layout. Currently, products such as indoor small-pitch 1010 are in an absolute leading position in the industry, and 0808 has also been stably produced and shipped. The market response for outdoor small-pitch 2727 and 1921 products has been enthusiastic. In particular, 1921 is the earliest domestically launched outdoor small-pitch product with the smallest size in the world, filling the gap in outdoor displays below P4.

In the future, Nationstar will continue to upgrade and improve existing products, and actively develop solutions for indoor and outdoor smaller spacing, to maintain its continued leadership in the small spacing product market. At the same time, it also cooperates with downstream application manufacturers to jointly develop the application of small-pitch displays in more fields besides large-screen displays.

In addition, Nationstar is also continuing to expand production and expand the production scale of small-pitch products to seize a larger market share.

Q: Benefiting from the high growth of the small-pitch LED market + mid-to-high-end white light packaging, the company has been gradually expanding production in recent years, moving towards a stage of simultaneous improvement in product technology and application fields. What are the considerations based on this?

In fact, Nationstar has been simultaneously improving product technology and application fields. Although small-pitch LED and white light packaging are both LED packages, they belong to two different LED application industries: display screen and lighting. Nationstar has been optimistic about the development of these two industries for a long time, and has long-term technical reserves and product reserves of RGB LED and white light LED. Currently, both businesses have achieved expected results.

Q: In the long run, white LEDs will still be the focus of market competition and the largest market in the application field. How will Nationstar Optoelectronics establish its own competitive barriers at the product and market levels in the future?

The first is technological improvement and a rich product system. After more than ten years of accumulation, Nationstar white LED has a complete product series from 2835 platform to COB, from EMC to CSP, from automotive lighting to infrared/ultraviolet lighting.

The color rendering index of the product has been improved from Ra80, which is common in the industry, to Ra90, or even Ra97, and has made great breakthroughs in anti-sulfurization. It is at the domestic and even international leading level in terms of reliability, light color uniformity, high color rendering and batch consistency. The entire series of products has passed the LM80 test.

Secondly, Nationstar’s pursuit and persistence of product performance and quality. In 2016, Nationstar White LED launched the "RooStar" series, which has peak performance such as ultra-high luminous efficiency, ultra-high display index, ultra-high reliability, ultra-high sulfur resistance, and ultra-long life. It is positioned in the high-end white LED market at home and abroad, and continues to make efforts in technology and product upgrades.

Furthermore, we are actively participating in international cooperation. At present, almost all of the top ten domestic lighting manufacturers have business cooperation with Nationstar. International first-line lighting companies have also established cooperative relationships with Nationstar. We are currently discussing the implementation of the project in depth. The customer structure is good and stable, and will continue to be optimized.

Q: How does Nationstar Optoelectronics’ R&D system ensure its product and market differentiation?

Nationstar has always attached great importance to the company’s R&D system. Every year, about 4% of sales are invested in R&D, establishing a national R&D institution, cultivating a group of domestic first-class technological innovation talents, and achieving fruitful results in new technology research, new product development, and independent intellectual property protection.

Nationstar has also been paying close attention to the development of new technologies and market segments, planning and laying out future technical directions and application areas, continuing to track the market and reserve technology, and make timely breakthroughs according to market demand to win market opportunities.

In addition, Nationstar insists on collaborative innovation between upstream, midstream and downstream. Determining the direction of new technologies, improving product processes, formulating solutions to special needs, and other various research and development tasks are the collaborative work of upstream, midstream, and downstream R&D personnel to ensure the rapid and effective mobilization of core resources such as talent and technology, improve efficiency, and reduce costs.

Q: The LED packaging industry is in a cycle of gradually increasing market concentration. How does Nationstar Optoelectronics view the changes in the packaging industry?

Whether it is price wars or the development of subdivisions, these are inevitable rules for the industry to develop to a certain stage. The LED packaging industry is gradually becoming concentrated, and the situation of the larger Evergrande will become more obvious. For Nationstar, this is undoubtedly a new development opportunity.

This change in the pattern means that the LED packaging industry is gradually returning to rationality. After the price war and industry reshuffle in the past few years, the industry is changing from blindly pursuing low prices to focusing on the product itself, such as technology, performance, etc. These are the advantages of large companies such as Nationstar.

Small and medium-sized enterprises without core technologies have closed down or switched to certain subdivisions, which has led to a gradual increase in industry concentration. This is also a good trend in the industry as a whole.

Q: In the future, will the packaging industry enter a stage where big fish eat small fish, and fast fish eat slow fish? Will industry mergers and acquisitions become one of the strategic directions of enterprises?

Natural selection, survival of the fittest. No matter which industry you are in, "big fish eat small fish, fast fish eat slow fish" is inevitable. This is a universal law of market competition.

Mergers and acquisitions are common in every industry. This is also one of the fastest and most effective ways for companies to expand their scale and seize market share. However, from the perspective of healthy and coordinated development of the industry and complementary advantages of enterprise resources, this kind of opportunity is something that can be encountered but cannot be sought, and it can be regarded as an opportunity to continue to pay attention to.

Q: Overseas mergers and acquisitions have become one of the ways for Chinese companies to truly enter the global market in recent years. From the perspective of Nationstar Optoelectronics, is overseas acquisition one of the ways for Chinese packaging companies to become bigger and stronger?

When Chinese companies enter the global market, patents are a key factor. Overseas mergers and acquisitions can enable Chinese companies to quickly obtain overseas patents, advanced production technology and good customer groups, and gain a voice in global industrial competition. This is indeed an efficient and fast way.

However, overseas mergers and acquisitions often involve the protection of independent intellectual property rights such as brands and patents, and the matching of resources, channels and other factors. They often require a long period of observation and negotiation and are not something that can be accomplished overnight. Overseas mergers and acquisitions are not the only way for Chinese companies to enter the global market.

Nationstar has long-term reserves and protection of independent intellectual property rights such as patents, and has promoted the company's continuous advancement into the global market through the establishment of overseas subsidiaries and branches, and the launch of international high-end independent brands.

About Nationstar Optoelectronics:

Foshan Guoxing Optoelectronics Co., Ltd. is a national high-tech enterprise under Guangdong Guangsheng specializing in R&D, production, and sales of LED and LED application products, and a key high-tech enterprise under the National Torch Plan.

The company covers an area of 92,600 square meters and has a factory area of 199,000 square meters. The company was founded in 1969 and began to engage in LED packaging in 1976. It is one of the earliest companies in China to produce LEDs.

After more than 40 years of development, the company has been recognized by the industry with its advantages in capital, technology, talent and management. In 2014, Guangsheng Asset Management Co., Ltd., a large state-owned backbone enterprise in Guangdong Province, invested in the company, making Nationstar Optoelectronics a practitioner of the mixed ownership model.

While expanding and strengthening the main business of LED packaging, Nationstar Optoelectronics also takes into account the development of upstream LED chips and downstream LED lighting products, establishes a complete LED industry chain, and achieves vertical integration.

In the future, Nationstar Optoelectronics will adhere to the integration of the LED industry chain, adhere to the development of enterprises through science and technology, leading talents, standardized management, and excellent culture, and is committed to becoming the leading LED company in mainland China and striving to promote the development of China's LED industry.