On March 1, the Ministry of Industry and Information Technology, the General Administration of Radio, Television and Television and the Central Broadcasting Station jointly issued the Action Plan for the Development of Ultra-High Definition Video Industry (2019-2022). In accordance with the overall technical line of "4K first, taking into account 8K", we vigorously promoted the development of Ultra-High Definition Video Industry and its application in related fields. The plan is divided into two stages:
By 2020, sales of 4K TV terminals meeting the requirements of high dynamic range (HDR), wide gamut, three-dimensional sound, high frame rate and high color depth accounted for more than 40% of total TV sales.
By 2022, 4K TV terminals that meet the requirements of HDR, wide gamut, three-dimensional sound, high frame rate and high color depth will be widely used. The sales of 8K TV terminals account for more than 5% of total TV sales.
What is 4K Ultra High Definition
The most well-known 1080P HD video, 1920X1080 resolution, 207,000 pixels; the general cinema 2K HD resolution is 2048X1080 resolution, 221,000 pixels; and 4K is 4096X2160 resolution, 885,000 pixels. In terms of pixels, 4K is 4 times 2K and 8K is 16 times 2K. The resolution of 4K UHD is 4 times higher than that of original HD. The improvement of resolution naturally means the increase of data volume. In the 4K era, the amount of data per frame reaches 50M, which is why 4K TV is proposed to be popularized when 5G is about to be commercialized.
How much space does 4K TV market have?
According to the general technical line of Ministry of Industry and Information Technology - "4K first, 8K at the same time": by 2022, 4K ultra-high definition television needs to be popularized in an all-round way.
Relevant data show that there are about 600 million TV sets in China, including 110 million UHD TV sets and 250 million LCD TV sets worldwide. Assuming that the global penetration rate of 4K TV will reach 40% by 2020 and 70% by 2022, the global penetration rate of 4K TV will correspond to 175 million 4K TV sets. In the medium and long term, 4K TV has a huge alternative space.
In addition, the last round of home appliances going to the countryside was around 2010 (about 80 million units sold), which will enter the renewal cycle to provide short-term incremental demand.
What is the impact on the LED industry?
The huge market demand will drive the popularization of Mini-LED backlight in the TV market, and provide the source power for LED enterprises to research and develop technology.
Each LED 2 inch chip can supply 25 4K televisions. 175 million 4K televisions need 70 million 2 inch epitaxies, equivalent to 5.8 million pieces per month, which accounts for 60% of the current domestic production capacity of LED chips. With the demand for Mini LED backlights from monitor and other LCD panels, the demand for LED chips is expected to double. Mini LED, as a new technology and product of LED chips, began to produce in the world in 2019, and its output value is expected to show explosive growth in 2019-2022.
Mini LED technology maturity is expected to promote the development of RGB display screen
With the release of Mini LED backlight, it will drive the rapid maturity of Mini LED chip technology and the growth of RGB industry chain. RGB Mini LED display screen will also be rapidly released, which will drive a greater demand for LED chips. According to the annual sales of 1 million Mini LED RGB large screen/super large size TV sets worldwide, the demand for LED epitaxial films is 25 million pieces/month, which is 2.5 times the domestic output of 10 million pieces of LED epitaxial films. At present, the global output of LED epitaxial films is only 15.65 million pieces/month.
LED Enterprises Related to Industrial Chain
Mini-LED Chip: Sanan Photoelectric/Huacan Photoelectric
Sanan Optoelectronics, as the leading enterprise in the field of chips in China, has been committed to building a chip ecosystem around artificial intelligence, 5G, vehicle network, Internet of Things and other peripheral application scenarios. The investment amount of Quanzhou Core Valley in Nan'an Base, which has caused a sensation in the industry, is as high as 33.3 billion yuan, aiming at Mini LED and MiroLED technology. MicroLED technology was developed in 2016, and then the focus was shifted to MiniLED. In February 2018, Sanan Optoelectronics signed the Advance Payment Agreement with Samsung Electronics. Samsung will pay about 16.83 million US dollars in advance for the exclusive supply of Mini LED chips to Samsung by Sanan Optoelectronics. Industry insiders say that Sanan has developed a 20-micron diameter Miro LED product. Meanwhile, Sanan will also produce 4-micron LED and 10-micron LED flip chip, and will establish the first micro-LED epitaxy chip and chip production line in the first quarter of 2019.
Huacan Optoelectronics has also made substantial progress in the layout of Mini LED and Miro LED technology. Mini LED products have taken the lead in entering the market in batches and further expanding production. At present, the shipment of Huacan Mini RGB chips is stable, and the market share is also rising steadily. Huacan optoelectronic LED chips have been successfully applied to influential conferences and commercial projects at home and abroad, such as the Sopot Forest Opera House in Poland, Tianjin Night of the Davos Forum, and the 2018 Hunan Satellite Television Annual Concert.
Mini-LED Packaging: Guoxing Photoelectric/Dongshan Precision/Ruifeng Photoelectric
In March 2018, National Star Optoelectronics established the "Micro & Mini LED Research and Development Center". In June, the first Mini LED was launched. In August, Mini LED backlights and other devices and Mini LED backlight modules were launched. In October, RGB device business was upgraded to RGB strategic management and control business. Just after the New Year of 2019, an expansion plan based on new generation LED packaging devices and supporting epitaxy chips was announced, with the scale of expansion reaching 1 billion yuan.
The semi-annual report of Dongshan Precision 2018 shows that LED and its display devices account for 14.76% of business income, gross profit is about 166 million yuan, touch panel and LCM module account for 27.90% of business income, gross profit is about 259 million yuan. Together, they provided Dongshan Precision with a huge profit in the first half of the year, totaling about 425 million yuan in gross profit. Outside analysis of Dongshan Precision Show and Touch business, and acquisition of FLEX's PCB business, the main purpose is to focus most of the resources on the future 5G market, in-depth cultivation of high-level PCB business with high technical threshold.
Ruifeng Optoelectronics is also expanding the application of Mini LED product series, parallel development in smartphone, PAD, pen, TV and Display display applications. At the same time, special equipment and common technologies for Mini and MiroLED are developed, including mass transfer, phosphor deposition, blue light conversion technology, etc. In April 2018, a fund-raising plan of 467 million yuan was disclosed, mainly for SMD LED expansion project, Mini LED packaging production project and Micro LED research and development project. According to the latest performance report of Ruifeng Optoelectronics in 2018, the overall development trend of its main business is good, and the revenue of large and medium-sized backlight products and special application products has achieved rapid growth.
Mini-LED RGB Display Screen: Liad/ZM Technology/Ibsen
As the leading enterprise in the field of LED display, Lyad has also laid out Mini LED display field as early as possible, and constantly broadened its application field. By introducing industry-type intelligent display solutions, multi-channel business models, improving product differentiation performance, small-spacing LED technology innovation and other ways, Lyad has continued to enhance its comprehensive competitiveness. According to the data disclosed in the three-quarter report, the amount of new signing orders and new winning projects is 9.25 billion yuan. Depending on the steady growth of the main industry, we still made good achievements at the end of the year under the deterioration of the economic environment.
In 2018, ZHOU Ming Technology launched UTV III 176-inch commercial computer worldwide, actively developing the overall layout of LED film screens, developing special LED display screens suitable for cinemas and meeting the international standards of DCI, and establishing relevant industry solution departments to prepare for the small spacing of LED into the cinema market. In January 2019, the project of ZhouMing Zhongshan Intelligent Manufacturing Base with a total amount of about 2.2 billion yuan was announced.
Abyson's current business scope is mainly overseas. In the first half of 2018, the small spacing LED display products business signed 274 million yuan, an increase of 111% year on year, accounting for 28% of the total display orders, and the momentum of development is rapid.
In addition, according to incomplete statistics, there are enterprises such as Australian and Ocean Shunchang, Qianzhao Optoelectronics, Zhaochi Stock Company, Hongli Zhihui, Mulinsen and so on, which are involved in the upstream chip field, and enterprises such as Beijing Oriental A, Shentianma A, Lehman Stock, Otto Electronics, Vixino and so on, which are involved in the downstream application field of the industrial chain.
4K is an application direction of 5G. 5G is the carrier of transmission, 4K is the upgrade of consumption. Ultra-high definition TV technology with 4K as the core will become another big outlet in 5G era. The popularization of 4K TV is also a part of the new infrastructure information network.
4K industry mainly includes the following parts:
[4K TV and its core components] include 4K ultra-high definition chip, high-frequency circuit board PCB, ultra-high definition panel, whole machine manufacturers, etc. This part is the largest and most beneficial part of the industrial chain.
[4K Intermediate Transmission] includes UHD digital network transmission, edge computing, set-top box terminal equipment and so on.
[4K Content Production] includes the development and operation of digital TV value-added services.
Data Source: Research Newspaper & Huachuang Securities, Aladdin Lighting Network