Investment Rating - The report does not explicitly provide an investment rating for the non-automotive large-size LCD industry Core Insights - The non-automotive large-size LCD industry primarily involves the processing and manufacturing of LCDs 7 inches and above, adopting a sales-based production model with cyclical characteristics. The competition between LCD and OLED technologies is stabilizing, with LCD maintaining competitiveness in the mid-to-low-end market. In 2021, multiple replacement cycles and the surge in remote work and online education drove LCD shipments and prices to historical highs. However, the maturity of panel technology limits the price increase capability of LCDs, leading to a market entering a mature phase where shipment volume is more cyclical than growth-oriented, primarily influenced by replacement cycles and population size, with average prices expected to stabilize in line with global CPI fluctuations [4][40][43]. Industry Definition - LCDs are flat-panel display devices widely used in various electronic devices with medium to large screens. The core working principle is based on the properties of liquid crystal molecules, which control the polarization direction and light transmission by adjusting the electric field intensity. This technology allows LCDs to provide clear and stable visual effects while maintaining low energy consumption. The non-automotive large-size LCD industry is a sub-sector focused on the processing and manufacturing of LCDs 7 inches and above [5]. Industry Characteristics - The non-automotive large-size LCD industry exhibits strong cyclical characteristics, primarily driven by consumer electronics with a typical replacement cycle of 3-5 years. The demand for these products is closely linked to economic conditions and consumer price sensitivity, further enhancing the cyclical nature [16][17]. - The industry mainly adopts a sales-based production model, supported by the mature technology of LCDs, which has a short stocking cycle and low industry entry barriers, making supply unlikely to restrict industry development [18]. - The competition between LCD and OLED technologies is stabilizing, with LCD maintaining strong competitiveness in the mid-to-low-end market despite OLED's advantages in high-end applications [19]. Industry Chain Analysis - The upstream of the LCD industry chain includes liquid crystal materials, glass substrates, polarizers, and chemical materials, providing qualified components and materials to the midstream. The midstream consists of LCD panel manufacturers responsible for producing non-automotive large-size LCDs, while the downstream includes manufacturers of LCD televisions, laptops, tablets, and monitors, which are responsible for consuming and connecting with end consumers [23]. - The report highlights that the bargaining power of upstream companies varies, with a general trend of squeezing midstream companies. For instance, the leading polarizer company Nitto Denko achieved a net profit margin of 13.54%, while Chinese polarizer companies had significantly lower margins [24][30]. Market Size and Trends - The non-automotive large-size LCD market size fluctuated from $51.56 billion in 2020 to $41.35 billion in 2024, with expectations of gradual recovery to $47.79 billion from 2025 to 2030 [40]. - The report attributes the historical changes in market size to multiple replacement cycles and the surge in demand for computers due to remote work and online education in 2021, which drove LCD shipments to historical highs [41][42]. Competitive Landscape - The competitive landscape of the non-automotive large-size LCD industry is characterized by high intensity, with major players including BOE Technology Group, TCL Technology, Sharp, and Panasonic in the first tier. The second tier includes companies like Rainbow Optoelectronics and Xiaomi, while smaller companies occupy the third tier [50][51]. - The report indicates that the profitability of mid-sized enterprises is relatively limited, leading to a risk of elimination in a highly competitive environment. The overall investment return rate in the industry is low, discouraging new entrants and contributing to increased industry concentration [53][54].

Group 1 - The global flat panel display market is expected to grow by 11% year-on-year in 2024, driven by various product categories, with televisions and tablets contributing the most to the growth [1] - Television panel revenue is projected to increase by 19% in 2024, primarily due to rising demand in the large-size segment, which also improves the overall average selling price [1] - The smartphone remains the largest application area for flat panel displays in 2024, but its growth is expected to be flat, aligning with downstream shipment trends [1] Group 2 - The display and PC panel revenue is anticipated to achieve double-digit growth in 2024 after hitting a low at the end of 2023, with future growth expected to maintain mid-single-digit levels [4] - The AR/VR panel revenue is declining due to a drop in device shipments, but growth is expected to resume in the next couple of years, particularly with the integration of AI technologies [4] - The automotive sector is becoming a significant growth driver for panel revenue, with increasing demand for larger and more precise displays in cockpit infotainment systems [4]

Core Viewpoint - Sharp is selling its second factory at the Kameyama plant to its parent company, Hon Hai Precision Industry, in response to deteriorating profitability in the liquid crystal panel business due to increased production by Chinese companies and falling panel prices [1]. Group 1 - The Kameyama plant was previously known for producing televisions that enhanced the Sharp brand's visibility [1]. - The second factory's operating rate has decreased to about 80% of its original capacity as of June 2024 [1]. - Sharp aims to improve the profitability of its liquid crystal panel business by divesting from less profitable facilities [1]. Group 2 - The Kameyama plant currently focuses on producing small to medium-sized panels for smartphones, tablets, and personal computers [1]. - The decision to sell the second factory is part of Sharp's strategy to restructure its liquid crystal panel operations and enhance overall performance [1].