LED lighting industry opens the golden year of development


China will be a major global producer of LED lighting. From the perspective of the cost structure of LED lighting products, it is mainly composed of LED light source, PCB board, driver IC, heat sink and optical lens. In addition to the driver IC, China has very strong competitiveness. In terms of core LED light sources, domestic manufacturers have traditional advantages in the field of packaging, and the chip field has been internationally competitive since 2012. We believe that in LED lighting manufacturing, Chinese manufacturers will dominate the global industry, just as Chinese manufacturers master more than 80 global energy-saving lamp manufacturing.
According to the agency's estimate, the growth rate of domestic LED indoor lighting in 2013 will be 87. We believe that LED indoor lighting is in the continuous application popularization stage. It is expected that the growth rate of domestic LED indoor lighting in 2014-15 will be 65 and 43 respectively.
It is expected that LED energy-saving lighting subsidies will have follow-up policies to launch the first LED lighting subsidies in China in 2012. From the situation we understand, the actual effect of subsidies in 2012 is not good, and most companies have not completed the promotion tasks. The LED lighting subsidy in 2013 has actually been delayed, and we estimate that there will be a relatively large probability of launch in the first half of 2014, especially in the first quarter.
As LEDs are more environmentally friendly and economical than the energy-saving lamps, we estimate that the energy-saving lighting subsidy policy in 2014 may be tilted toward LEDs.
Industry boom: upstream recovery, stable investment in the middle and lower reaches: downstream? Midstream? After the upstream of 2010, due to the decline in the LED industry's prosperity, the newly-planned investment in the domestic LED industry has shown a downward trend. According to the statistical analysis of the organization, the new investment in the industry in the first half of 2013 was 37 billion yuan, down 16.1 year-on-year in the first half of 2012.
In 2013, LED industry investment hotspots have been transferred from the upstream sapphire and epitaxial chip fields to downstream applications, especially in lighting applications. According to institutional statistics, the proportion of newly-planned investment in LED application investment in the first half of 2013 was 70, of which 23.2 billion were invested in lighting applications, accounting for 63% of total planned investment.
The investment orientation in the first half of 2013 reflects the difference in return on investment in different areas of the current environment. Is it still downstream? Midstream? Upstream. According to our estimation, the marginal ROE of LED lighting applications and packaging companies is significantly higher than 20, and its expansion is positive. The ROE in the chip field is lower than the packaging and application fields, and the investment enthusiasm is relatively low. Industrial capital itself has a profit-seeking nature. From the perspective of capital investment, industrial capital is relatively more optimistic about downstream lighting applications.
Epitaxial chip: profit bottom rebounded, mainland industry status increased chip demand overall steady growth, but apparently concentrated in mainland China According to the electronic time forecast in December 2013, the global high-brightness LED output value in 2014 will reach 12.74 billion US dollars, an increase of 12.9, driven by The application products of industrial growth kinetic energy are LED lighting, tablet computers, mobile devices, vehicles, etc., with the number of LEDs used, the annual growth rate will be 64.2, 36.8, 9.2, 9.8. Frankly, this growth is expected. Estimation is not exciting.
In the recent VEECO outlook for MOCVD, it is also possible to see that the growth rate of the epitaxial chip (area) is within 20%.
The more important phenomenon is that the mainland LED chip industry is expected to achieve faster growth. The main reason is that LED chip technology is gradually maturing, and the technological gap between mainland manufacturers and international advanced manufacturers is rapidly shrinking, causing international manufacturers, especially European and American chip manufacturers, not willing to increase investment in epitaxial chips, and instead seek Outsourcing capacity. According to the information we have learned from the industry, domestic manufacturers have a small gap between small and medium power chips and international manufacturers, while small and medium power is the mainstream technology solution for indoor lighting. At present, Sanan Optoelectronics Chip has a leading level in China, while Huacan Optoelectronics and Dehao Runda only follow the slight technical gap.

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