Mini-LED doesn't smell good anymore? San'an Optoelectronics has been reduced by the big fund, and these companies have "lying guns".

On the evening of August 31st, San'an Optoelectronics (600703.SH) disclosed that the National Integrated Circuit Industry Investment Fund (hereinafter referred to as the "big fund"), which holds 8.469 per cent of the shares, plans to reduce its holdings by no more than 2 per cent. It is worth noting that Mini-LED is receiving capital attention because of the promotion and application of Apple, Huawei and other large companies, and the stock prices of related stocks have risen to varying degrees recently. Some people in the industry said that the reduction of large funds is mainly in accordance with the rhythm of their own capital arrangements, which is normal behavior.

A reporter from the Financial Associated Press noted that since the beginning of this year, the "reduction action" of large funds has been more positive. In addition to Zhaoyi Innovation (603986.SH), long Electric Technology (600584.SH), Taiji Industry (600667.SH), etc., there is also Ruixin Micro (603893.SH) which is still in the period of reducing its holdings in the near future. On August 30, Ruixin micro announcement shows that as of August 27, 2021, big funds have reduced their holdings of 2.7093 million shares by more than half, and the reduction plan has not yet been completed.

San'an Optoelectronics is a leading enterprise of LED chips in the world. In the first half of this year, the company achieved revenue of 6.11 billion yuan, an increase of 71.38% over the same period last year, and a net profit of 884 million yuan, up 39.18% over the same period last year. The company said that the market demand for LED is strong, and the prices of some low-end products continue to rise, and it is expected that the prices of some products will continue to rise in the future. However, San'an Optoelectronics has recently encountered capital concerns, not because of the traditional LED business, but because of the Mini-LED chip business and compound semiconductors that are being promoted and applied in the market.

As Huawei, Apple, Samsung and other mobile phone manufacturers have launched Mini-LED products, the market space of Mini-LED has been opened. San'an Optoelectronics has attracted much attention because of its related layout. According to the news on Aug. 12, Apple, which is regarded as a weather vane, has begun mass production of the new Mini-LED backlit MacBook Pro, which is expected to ship 600000 to 800000 units a month between August and November.

But the application of laptop is only one link, and Mini-LED is also widely used in display fields such as TV, car screen and so on, among which TV is quite promising. According to the latest report from research firm Omdia, global Mini-LED TV shipments are expected to reach 5 million this year, 10 times the 500000 last year, and Mini-LED backlight TV shipments are expected to reach 25 million in 2025, accounting for 10% of the entire TV market.

At the same time, high cost is still a big problem for Mini-LED. Take the high-density AM Mini-LED backlight as an example, its cost is 4 times that of the ordinary LCD. Over time, the cost gap may narrow. According to Pei Xiaoming, vice president of Ruifeng Optoelectronics, the overall cost of Mini-LED backlight is expected to fall by nearly 50 per cent by 2025.

While Sanan Optoelectronics's Hubei Sanan Mini/Micro shows that part of the production capacity of the chip industrialization project has been put into operation, the company said that with the gradual release of production capacity and the gradual increase in the proportion of high-end products, the company's revenue scale and profitability will continue to improve. According to people close to the company told the Financial Associated Press, the current supply of Mini-LED exceeds demand, the original production capacity is basically full.

As of August 31, San'an Optoelectronics shares had fallen more than 19% from a high of 44.92 yuan in early August.