Chinese Share of LCD Panel Market to Keep Rising
The author is an analyst of NH Investment & Securities. He can be reached at j.ko@nhqv.com. -- Ed.
Chinese LCD makers are to continue expanding their production capacities in order to increase M/Ss. Despite Covid-19, their investment plans remain unchanged. Globally, the number of 8G-and-above LCD facilities is predicted to increase slightly: 25 in 2019 → 27 in 2020 → 26 in 2021 → 27 in 2022. Out of this total, the Chinese portion is forecast to climb: 56% in 2019 → 63% in 2020 → 69% in 2021→ 74% in 2022. With their LCD technological competitiveness to continue strengthening, Chinese companies’ share of the global 8K LCD TV panel market should jump sharply from 0.4% in 2019 to 33.1% in 2020.
Domestic companies to keep reducing LCD production capacity
Domestic LCD makers (ie, Samsung Display and LG Display) have sharply scaled back their LCD businesses, as the business outlook is dim due to Chinese panel makers’ strengthening LCD competitiveness. Samsung Display’s major LCD facilities (L7-2, L8-1, and L8-2) are located in Suzhou, China, and the company is expected to discontinue its LCD business from 2021. LG Display has already stopped the operation of its major LCD facilities (P7 and P8) in Guangzhou, China. The number 5G-and-above LCD plants operated by domestic firms should gradually shrink: 10 in 2019 → 7 in 2020 → 3 in 2021 → 2 in 2022.
OLED TV penetration to continue rising
The large-size OLED panel market boasts ample growth potential. Global demand for large-size OLED panels should pick up on new entrants to the OLED TV market. Huawei, Xiaomi, Sharp, Vizio and others have made a foray into the OLED TV market this year, and 48-inch OLED TVs boasting strong price competitiveness are about to hit the market. Demand growth for OLED TVs should climb from 13% in 2019 to 39% in 2020 to 57% in 2021, and the OLED TV portion out of the TV market should increase from 1.2% in 2019 to 2.0% in 2020 to 2.6% in 2021. Regarding the supply side, LG Display’s Guangzhou operations are expected to normalize. Global production capacity growth for large-size OLED panels should rise: 18% in 2019→ 42% in 2020 → 56% in 2021.
Foldable OLED market should keep growing strongly
The foldable OLED market should keep growing strongly. We estimate that the market will expand at a CAGR of over 70% on a panel shipments basis over 2020~2025. OLED panels are garnering attention, as they enable the adoption of a variety of form factors. Rollable OLEDs are increasingly being used for TVs, with foldable OLEDs being adopted for laptops and smartphones. A number of companies have released IT devices that sport foldable OLED panels, most of which are smartphones. With handset makers striving to differentiate their smartphone models based on display form factors—as well as multi-camera setups and biometric features—demand for foldable OLEDs should only increase further.