After almost a year of construction, Huacan Optoelectronics' Yiwu Plant finally commenced operations on July 15th. According to the company's president, Liu Wei, the launch of the Yiwu plant signifies the successful completion of the first phase of Huacan Optoelectronics’ new capacity expansion. By the end of this year, the company’s monthly LED chip production capacity is expected to reach 425,000 pieces, alleviating the current supply shortage and boosting the market share of its products.
The entire Yiwu plant project is planned to invest 6 billion yuan with an area exceeding 280 acres. Once fully operational, it will increase the production capacity by 250,000 pieces of 4-inch LED epitaxial wafers each month. The first phase of the project, which has already received an investment of 3 billion yuan over 140 acres, is expected to produce 150,000 LED chips and 200,000 sapphire substrates per month by year-end.
Currently, the global expansion of LED chips is primarily concentrated in mainland China, with domestic manufacturers like Sanan Optoelectronics and Huacan Optoelectronics leading the way. Specifically, Huacan Optoelectronics has scaled up its production from 200,000 pieces per month in 2016 to 425,000 pieces per month in 2017, representing a more than doubling of its output. This significant increase is expected to result in a substantial rise in the company’s sales revenue for 2017.
According to the interim results forecast released recently, Huacan Optoelectronics is projected to achieve a net profit between 213 million yuan and 228 million yuan from January to June this year, marking a year-over-year increase of over 300%. President Liu Wei mentioned that the company’s sales revenue this year is anticipated to grow by more than 80% compared to 1.58 billion yuan in 2016, with the goal of reaching 3 billion yuan.
Yu Xinhua, a partner at IDG Capital and chairman of Huacan Optoelectronics, believes that the future of the LED industry will hinge on breakthroughs in emerging applications such as automotive lighting, plant lighting, smart lighting, and small-pitch LEDs and MicroLEDs.
He also stated that IDG would continue to build platform enterprises across the critical segments of the semiconductor industry chain, promoting both vertical and horizontal integration. Meanwhile, the company will remain committed to developing Huacan Optoelectronics into a world-class LED manufacturer.
Wang Jiangbo, vice president of Huacan Optoelectronics, noted that the company has been increasing its R&D investments. Recently launched products include newly developed small-pitch LEDs and flip-chip MiniLEDs, while MicroLEDs are also in development.
At present, Huacan Optoelectronics operates four production bases in Wuhan, Suzhou, Yuxi, and Yiwu. Additionally, the company has successfully acquired the upstream sapphire substrate enterprise Lanjing Technology. With the integration of LED epitaxial chips and sapphire substrates, the Yiwu plant is set to become the company’s largest production base. It is also attracting downstream enterprises to invest in Yiwu to establish factories. It is worth mentioning that the country’s largest packaging company, Mulinsen, will also invest 1.5 billion yuan in Yiwu to construct a factory.
[Image: Company logo]
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