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The price of LCD display panels for TVs is still falling in November and is on the verge of falling back to the level at which it initially rose two years ago (in June 2020). Liu Yushi, a senior analyst at CINNO Research, told China State Grid reporters that the wave of “falling tide” may last until June this year. For related panel companies, after the performance surge in the past year, they will face pressure in 2022.

LCD display panel prices for TVs will remain at a high level throughout 2021 due to the high base of 13 consecutive months of increase, although the price of LCD display panels peaked in June last year and began to decline rapidly. Thanks to this, under the tight demand related to panel enterprises last year achieved substantial profit growth.

According to China State Grid, the annual revenue growth of major LCD display panel manufacturers in China (Shentianma A, TCL Technology, Peking Oriental A, Caihong Shares, Longteng Optoelectronics, AU, Inolux Optoelectronics, Hanyu Color Crystal) in 2021 is basically above double digits, and the net profit growth is also very obvious. Some small and medium-sized enterprises directly turn losses into profits. Leading enterprises such as BOE and TCL Technology more than doubled their net profit.

“There are two main reasons for the ideal performance of domestic display panel enterprises.” A color TV industry analyst believes that, on the one hand, under the effect of the epidemic, the demand for color TV and other electronic products surges, and the upstream raw materials are in shortage, which leads to the short supply of the panel industry, the price rises, and the corporate profits increase accordingly. In addition, as Samsung and LG, the two-panel giants, gradually withdrew from the LCD panel field, they put most of their energy and funds into the OLED(organic light-emitting diode) display panel industry, resulting in a serious shortage of LCD display panels, which objectively benefited China’s local LCD display panel manufacturers such as BOE and TCL China Star Optoelectronics.

Liu Yushi analyzed to reporters that relevant TV panel enterprises made outstanding achievements in 2021, and panel price rise is a very important contributing factor. In addition, three enterprises, such as BOE(BOE), CSOT(TCL China Star Optoelectronics) and HKC(Huike), accounted for 55% of the total shipments of LCD TV panels in 2021. It will be further raised to 60% in the first quarter of 2022. In other words, “simultaneous release of production capacity, expand market share, rising volume and price” is also one of the main reasons for the growth of these enterprises. However, entering the low demand in 2022, LCD TV panel prices continue to fall, and there is some uncertainty about whether the relevant panel companies can continue to grow.

According to Media data, in February this year, the monthly revenue of global large LCD panels has been a double decline of 6.80% month-on-month and 6.18% year-on-year, reaching $6.089 billion. Among them, TCL China Star and AU large-size LCD panel revenue maintained year-on-year growth, while BOE, Innolux, and LG large-size LCD panel monthly revenue decreased by 16.83%, 14.10%, and 5.51% respectively.

Throughout Q1, according to WitsView data, the average LCD TV panel price has been close to or below the average cost, and cash cost level, among which 32-inch LCD TV panel prices are 4.03% and 5.06% below cash cost, respectively; The prices of 43 and 65 inch LCD TV panels are only 0.46% and 3.42% higher than the cash cost, respectively.

The market decline trend is continuing, the reporter queried Omdia, WitsView, Sigmaintel(group intelligence consulting), Oviriwo, CINNO Research, and other institutions regarding the latest forecast data, the analysis results show that the price of the TV LCD panels is expected to continue to decline in April. According to CINNO Research, for example, prices for 32 -, 43 – and 55-inch LCD TV panels in April are expected to fall $1- $3 per screen from March to $37, $65, and $100, respectively. Prices of 65 – and 75-inch LCD TV panels will drop by $8 per screen to $152 and $242, respectively.

In the first quarter of this year, the retail volume of China’s color TV market was 9.03 million units, down 8.8% year on year. Retail sales totaled 28 billion yuan, down 10.1 percent year on year. Under the situation of volume drop, the industry expects this year color TV manufacturers will also set off a new round of LCD display panel prices war.

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