Market Status And Trend Analysis Of LCD Module Industry In China In 2018 OLED And QLED May Become The Mainstream Technology Direction

- Mar 22, 2019-

Analysis of Basic Situation of LCD Module Industry

LCD module refers to the modular components formed by assembling LCD panel and related driving circuit, backlight, integrated circuit and so on. Its structure varies with the application objects of downstream products.

In recent years, with the development of touch technology, touch screen is more and more widely used in LCD, especially in small and medium size LCD. The touch integrated LCD module also includes touch screen.

LCD module industry chain analysis: material-side profitability, the rise of domestic leverage industry layout

From the perspective of industry chain, LCD module industry chain can be divided into upstream basic materials, upstream panel manufacturing and downstream terminal products. Among them, upstream basic materials include: glass substrates, color filters, polarizers, liquid crystal materials, driving IC, backlight module, conductive silver glue, photoresist, etc; upstream panel manufacturing includes: Array, Cell, Module; downstream terminal products include: liquid crystal television, computers, smart phones, digital cameras, on-board displays and medical instruments.

From the gross interest rate analysis of LCD module industry chain, a famous theoretical "smile curve" is formed: the gross interest rate of industry chain is U-shaped, the high gross interest rate on the left is upstream basic materials (gross interest rate is above 40%), the middle low gross interest rate is upstream panel manufacturing (gross interest rate is 10-20%), and the high gross interest rate on the right is downstream terminal products (gross interest rate is 20-30%).

The "Smile Curve" is mainly due to technical barriers and competition patterns. The technical threshold of basic materials in the upstream of the industrial chain is very high, and most of them are monopolized by a few companies such as Japan, Korea and the United States, which has created a high gross profit situation in the upstream of the industrial chain. Half of the fabrication of mid-stream panels is controlled by South Korea. Since the mainland of China joined the war for market share, the competition pattern in the middle reaches has become more intense. The downstream application area is wider, the competition pattern is more dispersed, and the gross interest rate is in the middle level.

Domestic industry platform opens up a living space for upstream raw material enterprises, and gives the independent material R&D system in mainland China an opportunity to enter an upward cycle. Although the upstream materials are still dominated by enterprises in Europe, America, Japan and South Korea, there is still a gap between the quality of products in mainland China and that of foreign materials, with a small market share and concentrated in low and middle-end areas, the market pattern is changing quietly under the circumstances of vigorous investment in the whole industrial chain, support from national policies and persistent R&D and innovation by domestic enterprises.