OLED TV Panel Price Hike Expected in 2Q21
The author is an analyst of KB Securities. He can be reached at jeff.kim@kbfg.com. -- Ed.
Guangzhou OLED line to expand to accommodate new clients and supply shortage
According to the news provider The Elec (May 11), LGD will be increasing its OLED glass sheet capacity at its Guangzhou plant by 50% by June (60k units/month→90k units/month) without any major increases in capex. The increase without additional capex will be possible because the Guangzhou plant was initially designed and equipped to produce 90k large-size panels per month. LGD’s total OLED panel output should go from 8mn units in 2021 to 10mn in 2022 (170k glass sheets per month: 80k from Paju plant, 90k from Guangzhou plant). The company is increasing its output capacity to accommodate 1) new global clients in 2H21 and 2) the anticipated supply shortage in 2H21 created by surging OLED TV demand. The no. of companies manufacturing OLED TVs has increased from one in 2013 (LG Electronics) to 19 as of 2Q21.
OLED TV panel price hike expected in 2Q21
We expect OLED TVs’ sales-based market share to hit double digits (10% in 2021) for the first time since the TVs debuted in 2013, accounting for 40.3% of the market for USD2,000+ TVs (vs. 27.8% in 2019 and 33.5% in 2020). OLED TVs are rising to prominence because falling OLED panel prices—from 5x LCD panel prices in 2020 to 2x in 2021—is stoking demand. As a result, the OLED TV market became a seller’s market in 2Q21, providing LGD an opportunity to raise OLED TV panel prices.
Samsung Electronics to make foray into OLED TV market, accelerating expansion of global OLED TV ecosystem
Samsung Electronics (SEC) is likely to make its foray into the OLED TV market with the release of QD OLED TVs in 4Q21. This will accelerate the expansion of the global OLED TV ecosystem, increasing LGD’s OLED TV panel shipments. SEC, which leads the ultra-large TV market, will accelerate the proliferation of ultra-large OLED TVs. Global market growth should exceed expectations with 65”/75”/88” OLED TV shipments skyrocketing 52% YoY/70% YoY/2,366% YoY in 2021. LGD will contribute to the growing popularity of ultra-large OLED TVs with its relatively cheap 83” 4K panels added to its existing lineup of 65”, 77” and 88” 8K panels. Being the sole supplier of OLED TV panels, LGD is expected to see its OLED TV panel shipments grow 77% YoY to 7.88mn units.