Recently, despite the weak performance of A-share market, stocks concerning LED TV industry see a bullish market. MTC and Refond expect a significant rise in performance in the financial forecast for Q3 thanks to the prosperity in large-size LED TV. Thus it can be seen these stocks will lead the LED stocks in Q3.
 
Here comes the golden opportunity for the development of LED TV
 
Here comes the golden opportunity for the development of LED TV in China. Thanks to the highlighted energy saving performance of LED TV, China has announced many preferential policies on LED TVs.
 
Data shows that the demand area for LED TV is expected to amount to 8.5 million㎡in 2012, recording a y-o-y rise of 17%, total 9.3 million ㎡in 2013, representing a y-o-y increase of 9% and keep growth rate of 3% to 6% from 2014 to 2018. By 2018, the total area is expected to reach 116 million ㎡.
 
Meanwhile, OEM has become a global trend in the production of LED TV. China has turned into the manufacturing base for global consumer electronics owing to the strong industrial cluster. As a result, the outsourcing of global LED TV will bring great development opportunities for China’s LED TV industry.
 
Industrial development trend guides investment direction
 
LED TV industry has embraced excellent investment opportunities based on the following reasons. On the one hand, explosive industrial market demand continues to enhance the performance. On the other hand, the optimistic financial forecasts for Q3 are expected to drive the stock price of LED TV industry and bring investment opportunities for related stocks.
 
More importantly, three clear development trends have emerged in the development course of LED.
 
Firstly, the trend of LED taking place of LCD has emerged.
Secondly, end consumers demand larger LCD TV.
Thirdly, a typical “smiling curve”has taken shape in the development of LED TV, namely, upstream design and material are on the top of the profit chain together with downstream branding, while midstream packaging and other sectors at the bottom.
 
Following this though, we recommend that investors focus on two types of stocks, one is the stocks concerning with the two ends of the smiling curve, such as Redond, BOE, etc, the other is the industrial stocks that are close to the smiling curve, such as MTC who has outstanding branding advantage and market share in international outsourcing business.