Analysis of the Reasons for the LED Industry's Violent Shuffle

In recent years, the lighting industry has gradually transitioned to the LED lighting era, and the market has experienced explosive growth. However, since 2015, market demand is weak, LED product prices have fallen, and relative overcapacity has appeared.

According to survey data from the LED Research Institute of Industrial, Industrial and Research, the total scale of China's LED industry in 2015 reached 396.7 billion yuan, a year-on-year increase of 15.1%, and the year-on-year growth rate in 2014 reached 30.57%.
With the industry's growth rate almost declining, SMEs are constrained by funds, customers and channels, market operating costs are getting higher and higher, products are also changing rapidly, market expansion is becoming more and more difficult, inventory pressure is increasing, and closures And running the road has become the industry norm.

Industry mergers and acquisitions are booming

In the eyes of the industry, despite the slowdown in the growth of the lighting industry and difficult survival, it is undergoing a fierce industry reshuffle. "LED companies with scale, heavy technology research and development, and strong capital support will still have a lot to do in the future."
At the same time, the LED industry, especially downstream lighting companies, has frequent mergers and acquisitions with record highs. According to statistics from the LED Industry Research Institute of Industrial, Research and Development, as of November this year, the M & A amount of China's LED industry reached 40.8 billion yuan and 53 cases of mergers and acquisitions, compared with 6 billion yuan in 2014, an increase of 580% year-on-year. Among them, there were 39 mergers and acquisitions of over 100 million yuan, accounting for 73.6%.
"From the whole year of last year to the first half of 2015, mergers and acquisitions in the LED industry have occurred frequently. It is estimated that the total amount of mergers and acquisitions in the next two years will reach 100 billion yuan, and that mergers will be internationalized. Overseas mergers and acquisitions will also increase." Zhang Xiaofei said "The majority of listed companies participate in mergers and acquisitions, and the majority of mergers and acquisitions are dominated by downstream companies, and the elimination of industrial chain companies is accelerating."