Taipei, Wednesday, October 22, 2014 12:25 (GMT+8)
light rain
Trends in China's LED chip and packaging sector
Jessie Lin, DIGITIMES Research, Taipei [Wednesday 12 December 2012]
Registration required (free) to purchase. Please sign in if you wish to continue.
The China LED industry has developed at a breakneck pace over the last two years, thanks largely to a clear government policy on solid-state lighting (SSL) and the inclusion of LED as one of the key areas of industry for development within the 12th Five Year Plan. Looking at China's LED chip and packaging industry, there is considerable variation in the level of success achieved by the various major players, and this Digitimes Research Special Report analyzes these differences in terms of financial position, capacity and industry presence.
Output value forecasts for the China LED industry till 2015 (CNY billion)

The China LED industry has developed a breakneck pace over the last two years, largely thanks to a clear government policy on solid-state lighting (SSL) and the inclusion of LED as one of the key areas of industry for development within the 12th Five Year Plan (12th FYP). While the 12th FYP took effect from 2011, the government published a revised set of 12th FYP Semiconductor Lighting Technology Development Projects in 2012. The revised plans increase many of the numerical indicators and targets from the old version, demonstrating China's desire to up the pace of LED industry development. Digitimes Research compares the two versions for analysis.

While the government has established clear industry policies, the China LED industry still lacks the 20-year history of the Taiwan or Japan industries. The breakdown of sectors in which it is competitive and uncompetitive therefore differs significantly from those regions. Digitimes Research believes that China is most competitive in rare earth materials, LED packages, and end product applications; it is relatively weak in other areas.

This report mainly focuses on China's LED chip and packaging sector because in recent years, the number of MOCVD equipment in China has been growing rapidly due to strong government subsidies. This makes the development of the country's upstream and downstream LED sectors intriguing. There are considerable variations in the level of success achieved by the various major players, and these differences are analyzed in terms of financial position, capacity and industry presence. Digitimes Research believes Sanan Optoelectronics has the highest rating, followed by Electech, Epilight, Tsinghua Tongfang and Silan Azure.

The rise of China-based LED chip makers has also stimulated the growth of the regional LED package industry. However, China's industry ecosystem for the LED package sector differs from those of other regions most notably in terms of fragmentation, with more than 1,000 companies involved compared to only a handful of significant players in other regions. Digitimes Research has a number of players as indicators based on their relatively large size and greater potential for development; the largest of these are Nationstar, Honglitronic, Ledman, Refond, Jufei (JF), and Z-Light.

Nationstar has the greatest potential for future industry presence, with a very comprehensive industry chain covering upstream LED chips and downstream end lighting products. Honglitronic and Z-Light are more focused on downstream LED lighting development, while Ledman, Refond and Jufei are all mainly expanding LED package capacity. In overall terms, Nationstar is the most competitive and is likely to remain the number one China-based LED packaging company.

Table of contents
Price: NT$48,000 (approx. US$1,685)
Realtime news
  • Taiwan attracts foreign direct investment of over US$3.6 billion in January-September, says MOEA

    Bits + chips | 9min ago

  • SAS reportedly to raise funds for acquisitions

    Green energy | 20min ago

  • Chunghwa Telecom participates in NCP submarine cable construction

    Mobile + telecom | 41min ago

  • AUO sets up PV systems totaling 23.4MWp in Taiwan

    Green energy | 50min ago

  • North America semiconductor equipment industry posts book-to-bill ratio of 0.94 in September, says SEMI

    Bits + chips | Oct 21, 22:33

  • Taiwan Li-ion battery makers look to data center applications

    IT + CE | Oct 21, 22:31

  • Samsung, TSMC Solid State Lighting reportedly to quit LED lighting business, say Taiwan makers

    LED | Oct 21, 22:23

  • Apple announces financial results for fiscal 4Q14

    IT + CE | Oct 21, 22:19

  • Bitcoin mining ASIC supplier Alchip to debut on TSE

    Bits + chips | Oct 21, 22:15

  • TV panel pricing increases in October

    Before Going to Press | Oct 21, 21:59

  • TPCA to present development white-paper for PCB industry

    Before Going to Press | Oct 21, 21:58

  • China companies to raid talent from Taiwan semiconductor industry

    Before Going to Press | Oct 21, 21:57

  • TPCA Show 2014 to take place from October 22-24

    Before Going to Press | Oct 21, 20:35

  • Taiwan panel makers continuing to shift focus to China handset vendors

    Before Going to Press | Oct 21, 20:12

  • Panasonic expects strong growth in home, vehicle and B2B segments in China

    Before Going to Press | Oct 21, 20:10

  • Apple announces fiscal 4Q14 results

    Before Going to Press | Oct 21, 20:10

  • Ultra HD monitor development on the rise; touchscreen units declining

    Before Going to Press | Oct 21, 20:08

  • TV vendors aim to ship 34 million Ultra HD TVs in 2015

    Before Going to Press | Oct 21, 20:07

View more

Trends and forecasts for the China FPD industry, 2014-2017

CHINA FPD | Oct 6, 12:29

With China being the world's IT production center and a country with some of the strongest consumer demand, along with benefits on custom tax, funding, loans, and subsidies provided by the government, China's FPD industry continues to show strong growth. Local...

Taiwan servers and the global server market, 2014

RESEARCH EXTRAS | Oct 3, 12:19

Taiwan makers have successfully entered the supply chain of the Internet data center (IDC) industry and may contribute over 90% of the global server shipments in 2014. Combined revenues from related product lines such as motherboards, back-end assembly, storage...

Taiwan LCD monitors – 2Q 2014

TAIWAN FPD | Aug 25, 14:48

Taiwan's monitor shipments grew 10% in the second quarter compared to a low first-quarter base. With panel makers reducing their supply of monitor applications and monitor vendors reluctant to increase their shipments, Taiwan's makers will only see a single-digit...

China smartphone market and industry – 2Q 2014

CHINA SMARTPHONE | Aug 12, 17:41

A delay in the launch schedule for low-cost 4G smartphones resulted in a mere 4.8% increase in second quarter shipments in the China market. However, with telecom operators planning on increasing their subsidies in the second half of the year, demand will be...

Taiwan small- to mid-size LCD panels – 2Q 2014

TAIWAN FPD | Aug 6, 21:18

Taiwan makers' small- to medium-size panel shipments reached 351.4 million units in the second quarter of 2014, up 16.8% sequentially but down 2.8% on year.

The transition to 4k TV - UHD TV market forecast, 2014-2017
DIGITIMES Translation Services
  • 2014 global high brightness LED market, trends and shipment forecast

    For the global LED lighting market, the market size will reach US$25.82 billion in 2014 or a market penetration rate of 23.4%. This is attributable to exponential shipment growth for light bulbs, tubes, and directional lamps.

  • Greater China touch panel shipment forecast through 2015

    This Special Report provides forecasts through 2015 for Greater China touch panel shipments with breakdowns based on technology (glass, film, resistive), application (smartphone, NB and tablet) and by firm.

  • 2014 global tablet demand forecast

    This report analyzes the main players, their strategies and shipments forecasts for 2014, as well as other factors contributing to either growth or decline in various segments within the tablet market, with a particular focus on Apple, Google, Samsung, and Microsoft, along with whitebox vendors.