Guoxing Optoelectronics Launches LED Industry Chain Integration Strategy

“The top five companies in the LED chip market currently account for more than 40% of the market, but we are confident that we will surpass them.” Wang Haohao, chairman of Guoxing Optoelectronics Co., Ltd. said.

Recently, Guoxing Optoelectronics invested 400 million yuan to establish a joint venture with three other shareholders to produce LED chips. This is an important step for the company to accelerate the integration of LED industry chain strategy.

Integrated industrial chain strategy launch

On December 21 last year, Guoxing Optoelectronics announced that the company plans to invest 400 million yuan to jointly invest 600 million yuan with Guangzhou Chengxin, Guangfa Shunde and natural person Deng Jinming to establish Foshan Guoxing Semiconductor Technology Co., Ltd., engaged in LED epitaxy and chips. In research and development, production and sales, Guoxing Optoelectronics accounted for 66.7% of the company's shares and is the controlling shareholder. After the establishment of the joint venture company, Guoxing Optoelectronics will largely get rid of the dependence on upstream LED epitaxy and chip import. It is reported that Guoxing Semiconductor will invest more than 10 MOCVD equipment, with an annual production capacity of 600,000 epitaxial wafers, which will provide a stable supply for the packaging capacity of Guoxing Optoelectronics one year later.

"We have long established a strategy to integrate the LED industry chain, focusing on LED packaging devices, and extending the industry chain 1f3a in a timely manner." Wang Haohao said that the joint venture company's establishment of funds and talents are all in place. He said that in the future, the company will not rule out the extension of the downstream application design field to establish the channel and brand advantages of Guoxing Optoelectronics.

In fact, in July last year, Guoxing Optoelectronics established a joint venture company in Foshan Nanhai by participating in a 15% stake in Xurui Optoelectronics, and was involved in the upstream of the LED industry for the first time, participating in the R&D and manufacturing of high-power epitaxial wafers and chips. At the end of 2009, Guoxing Optoelectronics set up the LED lighting division to engage in the research and development of downstream LED application products such as LED lamps and light source modules. The joint venture to establish Foshan Guoxing Semiconductor Technology Co., Ltd. is undoubtedly another major step for Guoxing Optoelectronics to accelerate the integration of the LED industry chain.

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International giants have laid out

Wang Haohao said that the development of the domestic LED industry is still in its infancy. At present, there are about 60 companies engaged in upstream chip production in China, and there are more than 1,000 enterprises in the field of packaging, and more than 4,000 downstream applications. Most LED companies are concentrated in the downstream packaging and application products in the lower industrial technology threshold. The midstream high-end products in the industry chain, such as epitaxial wafers and chips, still rely mainly on imports.

"If the LED industry chain can be well integrated, Guoxing Optoelectronics has a large profit margin." Wang Haohao said that after the establishment of the new company, it will introduce excellent technical and management teams at home and abroad with equity incentives.

It is understood that at the same time as the domestic development of the LED industry in various parts of the country, Osram, Philips and other international lighting giants have also strengthened the integration and layout of the LED industry chain. The biggest advantage of Philips is that it has a complete industrial chain of LED lighting, especially its terminal advantages, and it is very strong in the field of lighting. In the past few years, Philips has quickly integrated companies in the LED lighting industry chain such as CK (Color Kinet ic s) and RL (Renaissance Lighting). From the upstream Lumileds to CK, RL, etc., Philips has quickly completed the LED lighting industry chain layout, and accelerated the pace of entering the Chinese lighting market.

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