Industry news

2016August

Government subsidies shrink LED industry will become the next PV?

From: www.szbako.com Data:14/08/2016

“ if the removal of government subsidies, the main business of Sanan optoelectronics 600703.SH and BDO 002005.SZ is loss or low profit. ” an industry veteran who declined to be named, told reporters.

Sanan optoelectronics Bulletin shows that in the past three years from 2011 to 2012 to 2010, Sanan optoelectronics to obtain the amount of government subsidies are 3.28 billion yuan, 805 million yuan, 253 million yuan, respectively, accounted for the year net profit of 40.5%, 86% and 60.4%. And de Ho Runda in this three years, the government subsidies were $, $, respectively, accounting for the year net profit of 138%, 79.1% and 129%. That is to say, in 2010 and 2012, if there is no government subsidies, the listing Corporation is a loss of.

in fact, government subsidies in addition to dress up led enterprise performance has deviated from the it had originally envisaged: & ldquo; attention LED technology research and development, and promote the industry development. ” the industry believes that a number of enterprises “ drilling subsidies for the empty ”.

in the face of such a situation, after the LED industry has always been favored by the local government chose the “ leave ”.

in mid March this year, Shenzhen City, suddenly abolished the "Shenzhen city on the issuance of the LED industry development plan (2009-2015) of the notice", but did not publish any explanation and reason. Some media quoted officials as saying in private, the government is worried that the LED industry, the actual emergence of excess capacity, and even worried about the LED industry to become the second PV industry.

huge subsidies to lose


PV or, LED worth mentioning, the government has played a crucial role in the early introduction. Only from the recent three years, the huge amount of subsidies related businesses can be seen.

in the past three years from 2011 to 2012 to 2010, Sanan optoelectronics to obtain the amount of government subsidies are 3.28 billion yuan, 805 million yuan, 253 million yuan, respectively, accounted for to the year net profit of 40.5%, 86% and 60.4%.

and de Ho Runda in these three years, the government subsidies were $, $, respectively, accounting for the year net profit of 138%, 79.1% and 129%. That is to say, in 2010 and 2012, if there is no government subsidies, the listing Corporation is a loss of.

data show that the above three optical subsidies was up to 24 the total number of a multitude of names. Among them, the two biggest names: MOCVD equipment purchase subsidy project government subsidies 9.11 billion yuan, on core Photovoltaic Science to 480 million yuan Co., Ltd. equipment purchase subsidy payments. In addition, there are key new products, LED chip industry and so on various subsidies names.

to see another listed company in the LED industry, de haorun amounts to 2012 revenue 28.24 billion yuan, fell 7.89%; net profit of 168 million yuan, drop compared to the same period 57.14%. For performance decline, BDO said that one important reason is in the fourth quarter of last year to the account of the one included in the loss of government subsidies fail to according to the expected arrival.

from the visible, the government subsidies for the listing Corporation's performance is how important. However, it now appears that the future of the listing Corporation can continue to receive so much government subsidies will become a question.

in the first quarter of 2013, Sanan optoelectronics and BDO because there is less of a subsidy, belonging to the shareholders of listed companies net profit over the same period, respectively, compared to a decrease of 29.53% and 18.77%.

de haorun amounts to predict this year first half net profit fell by 30% - 60%, this is mainly because from January to June 2013 received government subsidies over the previous year significantly over the same period the reduction and improvement for the main business of year comprehensive influence.

continued to receive government subsidies at the same time, the profit margin of the LED enterprise's main business was a downward trend.

Sanan photoelectric 2012 annual report showed that companies main business LED industry revenue is 25.8 billion yuan, 61.7% growth over the same period last year; net profit of 8.1 billion yuan, drop compared to the same period 13.47%.

is caused by the above situation, with the LED business in 2012 gross margin fell significantly, seriously affect the income of the LED project.

data display, optoelectronics 2010 gross margin was 40.28%, 39.66% in 2011, to 2012, gross margin is only 25.3%, 14.36% fewer than the same month last year.

BDO and Optoelectronics is similar: in 2011, led business, the company's gross margin was 38.4%, in 2012 the figure dropped to 33.83%, representing a decrease of 4.57%.

is not in place to subsidize the &ldquo

; the government will no longer be as the last few years to give businesses a huge amount of subsidies. ” the industry believes that with the arrival of the incubation period of the past, the arrival of the product competition, the government will not be like a few years ago to give businesses a huge amount of subsidies.

enterprise is already understand this point.

BDO said, with each led enterprises to purchase a large number of MOCVD equipment, government subsidy policy efforts may will be weakened, governments around the world is likely to gradually suspension or cancellation of subsidies for new equipment.

soon, this point in the BDO and Sanan optoelectronics 2013 first quarter earnings report has the obvious: in the first quarter, government of Sanan optoelectronics grants an reduced 68.4%, de haorun amounts to this data is more than 89.50% lower than the same period last year, a decrease of more than 90 million yuan. It is reported that

, Elec-Tech has purchased 80 sets of MOVCD equipment, and 50 working in purchasing. With the weakening of government subsidies, the cost of equipment will undoubtedly increase.

a people close to elec told reporters that the remaining 50 sets of equipment procurement will be based on market conditions and, may not purchase, may also be conducted in accordance with the original plan.

reporter noted, de haorun amounts to pre purchase 100 sets of the total price of the equipment does not exceed $261 billion, the average per unit price is not higher than $261 million, according to the latest exchange rate, namely every equipment RMB 160 million yuan.

de Ho Runda in 2012 received a total of yuan of government subsidies, of which MOVCD equipment subsidies are 13 million. If in accordance with the original plan to purchase 50 sets of equipment, will pay 800 million yuan elec-tech. So, if not equal to the amount of subsidies received last year, the cost will be significantly enlarged elec-tech.

insiders told reporters: the government initially intended to promote the development of LED technology through subsidies, thereby stimulating the development of the industry. “ but in fact, these subsidies down a few years, technology research and development is not in place, the government's subsidy supervision is not enough, the main performance is the lack of a complete set of operational system. ”

the person said, the regional subsidy policy is too strong, in Guangdong subsidies, went to Anhui to start on the no, all governments want to performance, so to Anhui can be subsidized. “ there are a lot of LED enterprises to take subsidies cover, buy equipment, but in the technical aspects of doing is not good. Many companies will take advantage of loopholes, their assets are more land and plant. ”

second PV?

government support policies, so that the LED industry has been rapid development in a short period of time, the number of LED enterprises in a short period of time, but the majority of small businesses. At the same time, in the industrial chain, the upstream enterprises, downstream enterprises less.

data show: 2009— 2011 this three years, the average annual increase of more than 20 LED chip projects, up to more than 80 domestic chip companies. As a result of a large influx of capital, the industry will soon be caught in excess capacity, LED chip prices decline in a straight line.

according to the Institute of high industry LED industry statistics, in 2012 China's LED chip average price fell 32%, some products such as the display screen with a small power LED Blue Green Chip average price decline of more than 50%. In the LED industry chain in the middle reaches of the packaging industry, in 2012 China's LED lighting white light packaging devices average price decline of more than 30%. In the downstream industry, 2012 China LED fluorescent lamp, led ball bubble lamp, LED panel light, led downlight etc. indoor lighting products, average price fell 23%.

insiders said that as a sunrise industry, 2012 the demand led market did not decline, but the expansion of production capacity far exceeds the demand, in the field of high-end lighting, domestic manufacturers did not get too much market share, only in the low-end dozens of big price war, resulting in structural overcapacity.

shuffle has begun. Prior to more than 80 LED chip companies currently only more than 50, in 2012 dropped out of more than 20.

in this context, the Shenzhen municipal government in mid March abruptly abolished the "notice on the issuance of Shenzhen LED industry development plan (2009-2015)", but did not publish any explanation and reason.

it is reported that the notice is proposed to the Shenzhen & ldquo; the completion of the national and the global LED industry R & D production base & rdquo; and also set over 130 billion yuan development goals by 2015, the annual output value of the scale of the industry. &ldquo

; Shenzhen's many small businesses are very flexible, high efficiency, what to do to make money. Government approach to ‘ let the market return to the market ’ (for business) is a wise approach. ” industry insiders say.

but also some media quoted officials privately say that the government is worried about the LED industry, the actual emergence of excess capacity, and even worried about the LED industry to become the second PV industry.

in 2012, the photovoltaic plate caught in a deep and double reverse the production capacity of the mire, the overall decline in the photovoltaic listing Corporation 24.69%, the Shanghai and Shenzhen 300 index lost 31.60 points. In addition, the EU will be in May 15th on China PV products anti-dumping and anti subsidy case for a preliminary ruling. It is reported that in the United States to China to implement “ dual anti ” after more than 80% of China's polysilicon companies were forced to stop production, China's export market share in the United States is only 20%, while in Europe is as high as 70%. Tongwei group board of directors Chairman Liu Hanyuan has said that the EU anti-dumping case will no doubt on China PV industry caused a huge blow.

and recent research results show that the current PV industry, even if the situation is a little better business, the operating rate is less than 80%, no profit.

, however, the industry veteran believes that the purchase of photovoltaic industry is entirely determined by the government's subsidies, the degree of LED market is much higher.

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