Advanced Facilities Efficient ProductionAccording to Korean media reports, people familiar with the matter revealed that 50% of LGD's current LED backlight modules come from South Korean manufacturer Wooree E&L, which took over LGD's backlight LED business with Seoul Semiconductor in 2020.
Wooree E&L's LED modules are mainly used as backlight sources on LCD panels, and the application scenarios include LCD panels for notebook computers, monitors, car navigation and signage. In addition, the company is actively developing 4-in-1 Mini LED modules.
In response to the strong market demand for LEDs for IT products, Wooree E&L announced in February this year that the LED module production line will increase from 18 to 20, and its monthly production capacity will increase to 4 million sets of light bars.
It is reported that LGD uses Wooree E&L's LED backlight modules to produce display panels, and then supplies the products to companies such as LG Electronics, Dell and Hewlett-Packard.
In 2020, Wooree E&L achieved revenue of 122.3 billion won, a year-on-year increase of 8%; realized operating income of 3.3 billion won, a year-on-year decrease of 5%. In the first half of 2020, the company's revenue and profits have declined, but the performance of the second half of 2020 will begin to gradually recover.
Despite the continued spread of the epidemic, demand for IT products remains strong, and Wooree E&L expects sales to increase significantly this year. In the first quarter of this year, Wooree E&L achieved revenue of 35.6 billion won, a year-on-year increase of 32%; realized operating income of 1.9 billion won, a significant increase of 2127% year-on-year. The company expects that the second quarter will continue the growth trend of the first quarter.
Reports show that after LG InnoTek decided to withdraw from the LED market in October 2019, Wooree E&L has received more LED module orders starting in 2020, and there are currently sufficient orders.
In 2020, Wooree E&L’s market share in LGD display LCD market will increase from 40% in 2019 to 60% in 2020. In the notebook segment, Wooree E&L’s share has increased from 20% in 2019 to 30% in 2020. For LGD's signage, Wooree E&L's share is 40%.
In the same context, in 2020, Seoul Semiconductor’s LED modules will increase its share of the LG TV market from 30% to 80%.
However, Korean media said that the current imbalance in the supply of display driver ICs will affect Wooree E&L's profit in the second half of the year.
According to a survey by TrendForce's Optoelectronics Research Division, whether it is LCD or LED direct display, display driver ICs are in short supply, and product prices have risen frequently recently. In the future, it shows that the shipments of related manufacturers may be affected by IC shortages, and the performance of supply chain manufacturers will be affected accordingly.