Taipei, Wednesday, July 23, 2014 15:38 (GMT+8)
light rain shower
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 market: Nearly 1,500 4G base stations in operation at end of June, says NCC

    Mobile + telecom | 17min ago

  • China Mobile TD-LTE user base increases to nearly 14 million in June

    Mobile + telecom | 38min ago

  • Microsoft cloud growth drives strong fiscal 4Q14 results

    IT + CE | 1h 41min ago

  • Apple reports fiscal 3Q14 results

    IT + CE | 1h 47min ago

  • USI reportedly lands SiP module orders for iWatch devices

    Bits + chips | 1h 49min ago

  • Microsoft facing increased competition from MacBooks and Chromebooks, say Taiwan makers

    IT + CE | 1h 50min ago

  • Investment in production of N-type monocrystalline solar cells may take off in 2-3 years

    Green energy | 1h 53min ago

  • E Ink Holdings sells CPT convertible bonds

    Before Going to Press | Jul 22, 21:46

  • Commentary: Microsoft moves to eliminate Nokia

    Before Going to Press | Jul 22, 21:41

View more

Analysis of China's revised domestic semiconductor industry goals

RESEARCH EXTRAS | Jul 16, 18:09

Facing a funding shortage for local IC manufacturers, the China State Council in June 2014 published guidelines to strengthen government support for China's semiconductor industry, while stating the short-, mid-, and long-term goals for the related industry supply...

The transition to 4k TV - UHD TV market forecast, 2014-2017

RESEARCH EXTRAS | Jun 26, 13:59

Ultra HD TV vendors are facing challenges due to an overall slowdown in the TV industry and are concerned whether relative supply chains can provide compatible Ultra HD content and services. However, trends show that content makers as well as panel and chip makers...

Taiwan notebooks – 2Q 2014

TAIWAN ICT | Jul 23, 12:53

Taiwan's notebook makers saw an unexpected sequential rise in shipments in the second quarter after the end of Microsoft's support for Windows XP generated a wave of replacement demand. Compared to the same period of last year, their shipments still dropped....

China smartphone market and industry – 1Q 2014

CHINA SMARTPHONE | May 15, 15:08

This report is divided into two sections; the first covers the China smartphone market, including shipments from international players and China-based players. The second section covers the China smartphone industry and covers shipments from local makers in the...

Taiwan LCD monitors – 1Q 2014

TAIWAN FPD | May 13, 15:41

Monitor shipments from Taiwan makers declined in the first quarter of 2014 mainly due to seasonality. And both upstream LCD panel suppliers and downstream system vendors remain conservative about the monitor market in the second quarter.

DIGITIMES Translation Services
DIGITIMES Marketing Services
Greater China touch panel shipment forecast through 2015