First of all, small-pitch LEDs have set a number of benchmark cases in the domestic market in government agencies, military security, radio and television studios, video conferencing and other fields, demonstrating complete splicing wall seamless solutions to users in various industries. In addition, there is also policy support: DLP products have been eliminated from some government procurement catalogs.
Secondly, overseas markets have given full acceptance of small-pitch LEDs with practical actions. Some integrators in Europe and the United States have applied small-pitch products made in China to studios, shopping malls, stadiums and other places. Electronic giants such as Samsung, Panasonic, NEC, and Philips have also entered this field through OEM or independent production.
After twenty years of hard work, the LED display industry has entered an era of major mergers
Since the 1990s, the LED display industry has begun to emerge in our country. Because LED has the advantages of energy saving, environmental protection, and low price, this industry has always been supported by national policies. After more than 20 years of development, my country has actually become a leader in the field of LED display manufacturing. Having gained a relative monopoly, such as former giants Daktronics, Barco and other overseas companies, their market space has been continuously eroded under the pressure of Chinese LED display companies. Currently, they can only maintain their market share in a few niche segments, or have chosen to transform themselves into system integrators and cooperate with Chinese companies.
According to industry association statistics, in 2014, there were about 20 companies in the LED display industry with sales of 200-500 million yuan, about 10 companies with sales of 500-1 billion yuan, and 3-5 companies with sales of 1 billion yuan. During the same period, the total output value of my country's LED display screen was as high as 30 billion. We have calculated the total revenue of the display business of six A-share companies with LED displays as their main business, which is only 4.2 billion, accounting for 14% of the country's total output value. The LED display industry CR6≈14%, and the industry concentration is obviously low. By visiting LED display companies and referring to the statements of entrepreneurs in the industry, we judge that the LED display industry has entered the era of large-scale mergers. Listed leading companies have used the power of the capital market to kick off large-scale mergers and acquisitions and reorganizations in order to create scale effects. Horizontal merger targets are concentrated on unlisted leaders in various subdivisions, and vertical acquisitions are concentrated in the downstream media and system integrators. In the next three years, there are expected to be 3-5 companies in the industry with operating income of 3-4 billion. Giant companies.
Turns out, the "small-pitch era" of LED displays is unstoppable
The concept of small-pitch LED displays was proposed by Leyard in 2008, and mass production began in 2011. Compared with traditional LED displays, the pixels (light-emitting lamp beads) have a smaller spacing. Due to high R&D costs and technical difficulties, only a few large companies in the industry such as Unilumin Technology have quickly followed suit. Judging from our research, the cost of LED small-pitch lamp beads at that time was as high as 1.5 yuan/piece. Calculated based on the standard of 1 million pieces/square meter, the cost of small-pitch LED panels per square meter was as high as millions, and the initial research and development costs were as high as tens of millions, which was beyond the reach of most companies. Judging from public data, more than 20 domestic LED companies have released their own small-pitch products. In 2014, only five companies' revenue from small-pitch displays exceeded 100 million, including Unilumin Technology, the leader in this segment. .
With the improvement of technology, the display accuracy of small-pitch displays fully meets the needs of close viewing, and it has comprehensive advantages in display effects, energy consumption, maintenance costs, etc. In fact, data shows that small-pitch LED displays have gradually eroded the shares of DLP and LCD.
"Small pitch" + "Creative Screen": Unilumin Technology leads the LED industry segment
Unilumin Technology is a leading international provider of LED display products and solutions. With its solid technical foundation and good market reputation in the LED display industry, Unilumin Technology ranked first in the "TOP10 Most Internationally Competitive LED Display Companies" in 2014 and 2015. The company's products are mainly divided into two series: LED full-color display screens and LED energy-saving lighting. The company has been based on the LED display business since its establishment in 2004. In recent years, it has further consolidated its leading advantages in LED creative screens, small-pitch displays, sports screens and other segments through multiple acquisitions. In recent years, the company has gradually increased its investment in high-margin LED lighting subdivisions (EMC projects, smart lighting) and accumulated a large number of channel resources. In the future, the lighting business is expected to enter a large-scale stage.
§The explosion of small-pitch business has helped the parent company’s performance grow rapidly
Since 2012, benefiting from the recovery of the industry and the explosion of small-pitch business, the parent company's net profit has grown rapidly. In 2013, the net profit was 32.9716 million yuan, a year-on-year increase of 45.26%; in 2014 The annual net profit was 60.8589 million yuan, a year-on-year increase of 84.58%; the net profit in 2015 was 113.5681 million yuan, a year-on-year increase of 86.61%; the net profit in the first quarter of 2016 was 20.16 million yuan, a year-on-year increase of 159.94%.
§Relying on Rdio, it strongly seizes the high-margin stage creative screen market
In 2012, Unilumin Technology acquired Raydio, a stage creative screen company positioned in the high-end rental market. Dior. Radio's customers are mainly concentrated in overseas markets such as Europe and North America. After long-term channel expansion and cooperation, it has a number of stable and high-quality overseas high-end customers (the company's top five customers are all top equipment leasing companies, such as XL, PRG, and LMG). It has successively set up subsidiaries in North America and Europe to continuously expand its overseas marketing network. The "Black Onyx" high-density splicing screen launched by Rdio in 2014 has successively won 7 top international design awards, including China's Red Star Gold Award, Japan's G-mark Award, Asia's Most Influential Gold Award, German IF Gold Award, and German Red Dot Award (among which the German "IF Design Gold Award" is known as the "Oscar of Industrial Design" in the international industrial design field).
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§ Comprehensive layout of intelligent manufacturing, unlimited possibilities in the future
With the adjustment and changes in the economic structure and the advent of the mobile Internet era, the LED display industry is also brewing a transformation and upgrading. Unilumin Technology actively complies with the national industry 4.0 and intelligent manufacturing strategic development trends, upgrades from production lines to products, and gradually transforms the traditional "Unilumin Manufacturing" into "Unilumin Manufacturing". While adhering to the strategy of endogenous + external development and focusing on the main business, we use "Internet +" thinking to integrate "Continent Smart Manufacturing" and use Internet technology and organizational models to create a platform company of intelligent hardware + content services + Internet (Internet of Things).
§Channel + Brand: Provide hard soft power for rapid development of enterprises
Unilumin Technology, as the only listed company that sells LED displays mainly through channels, has established cooperative relationships with more than 1,000 large-scale channel vendors in various fields. With the help of these channel resources and the company's own product advantages, as well as Rado's expansion in the high-end indoor rental market, the company's operating income from small-pitch displays is expected to continue to increase. The average annual growth rate of the small-pitch market in the next three years is expected to be more than 80%, exceeding 10 billion yuan by 2017. Considering that new entrants in the small-pitch industry are seizing market share, we conservatively estimate that the company's small-pitch business will grow at 50%-60% in 2016-17.
To sum up, the competition in the LED small-pitch market will continue to be the current competitive situation of big fish eating small fish in the next three years. The future competition in the LED small-pitch market will not only be a duel between domestic enterprises in terms of strength and a test of technological innovation capabilities among industries, but will also be a test of domestic brands at the operational level and on a global scale. In brand competition, only large companies with sufficient strength can continue and go far enough.
ANNA