Lighting market kicks off competition

Currently, driven by the concept of global energy conservation and environmental protection, new light source lighting represented by LEDs is causing a dramatic change in the lighting industry. Lighting products have also been better improved in terms of comfort while achieving energy-saving upgrades. The effect is also more diverse.

LED lighting market will completely open the door

On January 1, 2014, the United States announced that it would no longer produce and sell incandescent lamps of 60 watts and 40 watts; at the same time, Canada also officially banned 75 watt and 100 watt incandescent lamps. The EU banned the sale of incandescent lamps in 2012. Back in China, the price of LED lamps continued to fall, and it has basically dropped to the civil threshold. With the support of national policies, LED lighting will accelerate the replacement of traditional lighting. LED is expected to score twice after following the rear projection market.

“The current market expects a sharp increase in the demand for LED lighting, and 2014 is expected to be the year of the outbreak. On the basis of 2013, the optimism is expected to have more than double the growth, and cautious expectation will double.” LED chip maker executives said.

This estimate is not without basis: On the one hand is the start of the domestic LED lighting market. In 2012, the penetration rate of LED lighting was less than 3%. In 2013, the penetration rate increased to 6%. The industry has already entered the period of rapid growth after the introduction period. On the other hand, the overseas market has also given Chinese companies an opportunity. The General Administration of Customs estimated that the export growth of LED lighting products in the fourth quarter of 2013 was more than 80% year-on-year. In 2014, the global commercial and civil lighting market will exceed 100 billion yuan for the first time, and it is expected to reach 160 billion yuan in 2015. The compound growth rate in the next two years will be around 60%.

“Our company is very optimistic about the general trend of the LED lighting market to pick up, and has prepared for the upcoming outbreak of the demand side.” said Wang Qing, the director of the company.

In this regard, UBS Securities analyst Chen Li believes that compared with other growth industries, the current valuation of the LED sector is still relatively reasonable, the benchmark PE in 2014 is only 24 times, much lower than other growth stocks. The LED industry has performance support and is expected to grow between 30% and 50% in 2014 and is expected to achieve high growth in the first quarter. In the future, once the performance confirms the upward trend of the industry's economy, it will bring significant excess returns.

Overseas home lighting market can grow

Currently, LED penetration is rapidly increasing in the global market. According to estimates by global market research institutions, the LED lighting market output in 2014 was US$35.3 billion, 47.8% higher than 2013, and the penetration rate of LED lighting will also increase to 32.7% in 2014, among which the most widely used bulb lamp and lamp penetration The rates were 20% and 15% respectively.

In the past, in the LED lighting market, due to high prices and other reasons, the penetration rate of the civilian market has been low. With the promotion of LED lighting technology and the continuous decline in prices, governments around the world have issued favorable policies such as the prohibition of incandescent lamps. The highly-regarded civil market has begun to open the door to welcome the advent of the LED era. According to foreign UBS Securities pointed out that in 2014 the global LED lighting demand will increase by 60%, of which the largest growth in home lighting, next year will be able to increase by 90%, much higher than the commercial 37% and 57% of industrial use. It is expected that the demand for LED chips will grow by 25% next year.