LED Industry Concentration Needs Upgrading
Posted: 03/29/2016 07:03:08   Edited: 03/29/2016 07:03:08  Clicks: 989
LED price has dropped to the bottom, and downward trend gradually slows down: taking 60w LED bulbs as an example, the average price of 2013 to 2015 is respectively 30.74%, 23.36% and 11.59%. The price decline becomes significantly slow. LED declines will keep this trend in the future. From the supplier side, the reason for the LED price drop convergence is like the following: declining subsidies; the supply side of the electrical manufacturers such as crystal will shrink; Declining encapsulation scale.
Outdoor LED display market potential is considerable and small spacing shows promising prospect: generally, the smaller the point spacing is, the number of lights within a square unit can be used, so the LED small spacing market development has increased the demand of the LED lamp bead, balancing the supply and demand at some extent. For small spacing display products, lamp bead accounted for the largest part of cost, and the most part performance of the LED display also depends on the reliability of the lamp bead. As gh-led pointed out, for example, the cost of the LED small spacing TV lights accounted for about 70%.
LED permeability is rising and industry concentration is gradually increasing: global LED lighting permeability in 2015 reached 27%, maintaining the upward trend. We believe that the domestic LED lighting permeability is slightly higher than the global penetration level, about 30%, still having considerable space for development. According to incomplete statistics made by GSC research, of more than 35000 domestic LED enterprises, more than 8200 is of large scale. Reviewing traditional electronics industry, such as television, refrigerator, air conditioner, the top three manufacturers take more than 50% market share, and at present there are at least hundreds of LED display industries, among which the top 3 take less than 20% market share. So, LED industry market concentration will be promoted.
Investment strategy: from the perspective of supply side, declining subsidies and the shrinking of chip giant will all dictates smooth supply and the historical price movements also illustrates the LED price drop is slowing down. From the demand side, LED lighting permeability is still in rising stage, while the small spacing market is growing rapidly and pulling LED needs. From the dropping LED prices and the improving concentrated industry, we have confidence in the LED's long-term prospects.

LED Industry Concentration Needs Upgrading

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