\u3000\u3 Guocheng Mining Co.Ltd(000688) 378 Jilin Oled Material Tech Co.Ltd(688378) )
Introduction: Jilin Oled Material Tech Co.Ltd(688378) is a typical high-tech material enterprise. It has deep attainments in the field of OLED organic luminescence and functional materials. At the same time, it is also specialized in the evaporation source of key components used in evaporation machine. It is a worthy leading enterprise in the subdivision field of OLED materials and Application components in China. In the past, the OLED industry was basically monopolized by a few overseas enterprises, and the downstream terminals were once controlled by Korean enterprises such as Samsung. In such a closed industry ecology, without the support of any overseas manufacturers, Chinese material process manufacturers had to explore step by step Jilin Oled Material Tech Co.Ltd(688378) not only has it successfully achieved a large proportion of independent replacement of steam source components by Chinese panel plants, but also its share in each panel plant is increasing year by year. At the same time, in the field of RGB organic light-emitting materials and various OLED functional layer materials, the company’s product development has been continuously promoted, and the sales volume is also increasing year by year.
There is a view in the market that the growth of Jilin Oled Material Tech Co.Ltd(688378) mainly depends on the steam source, and the growth will slow down with the gradual saturation of China’s panel plant construction line. We think this view is very narrow: first, the growth space of steam source is still large, and the slowing down view is very appropriate to describe it as a leaf blocking the eyes, which we will talk about later; Secondly, Jilin Oled Material Tech Co.Ltd(688378) is not the only source of evaporation. The OLED market is large enough. There is a global market space of nearly 10 billion yuan for 30 or 40 kinds of organic materials. The share and voice of China’s panel manufacturers in the downstream terminal field are also gradually rising. Under this background, the materials Jilin Oled Material Tech Co.Ltd(688378) can make are not limited to RGB luminescent materials (even if they are only luminescent materials, there are several generations of different types of iterations), but will gradually be used in all functional layers Breakthroughs have been made in the application layer. These breakthroughs will make the proportion of organic materials in Jilin Oled Material Tech Co.Ltd(688378) future revenue structure gradually exceed the steam source, and then completely open the ceiling of growth.
China’s AMOLED industry chain has been gradually improved, and there is broad space for domestic substitution. In recent years, China’s display panel shipments have risen. According to the data of CCID think tank, 13 AMOLED production lines have been built in China by 2020, accounting for 52% of the global AMOLED production lines. In 2023, the global AMOLED panel revenue reached US $37.4 billion, and the scale of the Chinese market was about 84.3 billion yuan. The compound growth rate from 2019 to 2023 was 9.74% and 46% respectively; It shows that the domestic substitution space of AMOLED industry is large enough, and China’s growth rate is the world’s leading. Under the background of intense downstream consumer electronics competition and increasingly strong demand for cost reduction, AMOLED domestic alternative has become the best choice for midstream panel manufacturers. However, due to China’s late entry into the OLED industry and weak voice in the two key areas of upstream materials and equipment, relevant technologies and patents have been monopolized in the hands of overseas enterprises such as South Korea, Japan and Meide for almost a long time,
China is heavily dependent on imports. Therefore, improving the localization of OLED upstream materials and equipment in China is an inevitable choice to improve the health of the industrial chain Jilin Oled Material Tech Co.Ltd(688378) as a local leading enterprise with the capacity of preparing organic light-emitting materials and mass producing evaporation sources at the same time, it is expected to further expand its market share in the upsurge of OLED domestic substitution and consolidate its leading position on the road of strong and constant strength.
Steam source maintains the high growth foundation of the company, and organic materials continue to expand and expand the growth margin:
\u3000\u30001. Steaming source broke the international monopoly and ushered in a period of rapid growth. The organic luminescent material is sublimated by heating through the evaporation process to deposit a film on the substrate. The evaporation source is the “heart” part of the evaporation machine, the key equipment in the evaporation process. At present, the main suppliers in the world are South Korea Yas and SNU, Japan AIFA and China Jilin Oled Material Tech Co.Ltd(688378) . The company is the only Chinese manufacturer of linear evaporation source. By the end of 2020 and the beginning of 2021, the total capacity of the 6-generation AMOLED production line planned / under construction in China is about 354000 pieces / month. It can be estimated that the demand for evaporation source components in recent years is about 472 sets. Based on Jilin Oled Material Tech Co.Ltd(688378) the average sales unit price of 4.43 million yuan / set of evaporation source in the past few years, the market scale of China’s steam source is about 2.1 billion yuan. In the future, if a new AMOLED production line is invested, the market scale of steam source will continue to grow.
\u3000\u30002. RBG luminescent materials occupy the first mover advantage and are a solid foundation for future advancement. Organic luminescent materials account for 12% of the cost of OLED panels, which is one of the sub sectors with the highest technical barriers in the industrial chain. In order to meet the best luminous efficiency, best performance and high yield of the panel, the manufacturers need to invest a lot of time and capital in a series of links from the selection of raw materials, R & D, production technology to manufacturer certification. Compared with most Chinese OLED material manufacturers focusing on the production of front-end materials and intermediates, Jilin Oled Material Tech Co.Ltd(688378) not only realizes the mass production of terminal materials with the highest technical barriers, but also has the R & D and production capacity of various OLED functional layer materials Jilin Oled Material Tech Co.Ltd(688378) adhere to the market-oriented, self research as the driving force, and actively reserve the next generation of luminescent material technology; At the same time, accelerate the expansion of production capacity. It is expected that the new terminal material production line in Shanghai will reach the production capacity in 2023 and is expected to increase the production capacity of 10000kg / year, which will lay a solid foundation for the sustainable growth of the company’s organic light-emitting materials in the future.
\u3000\u30003. Continue to extend and innovate around OLED organic materials, and constantly expand the territory in key material fields such as film packaging and PI film. Thin film packaging material is an important material to isolate the bad contact of water vapor, improve the luminous efficiency and prolong the luminous effect and service life of organic light-emitting pixels after evaporation. PI film has wide applications in flexible substrates and AMOLED light-emitting panels. At present, these two products have achieved little success with the company’s R & D and promotion for many years. In addition, the company has completed the R & D and mass production of a variety of OLED organic light-emitting and functional key materials in recent years, and has successively entered the supply growth period Jilin Oled Material Tech Co.Ltd(688378) with the full support and cooperation of Chinese AMOLED panel enterprises, and with years of reserves and accumulation of organic light-emitting materials, functional layer materials, packaging materials, substrate materials and even barrier materials, it is able to continuously expand its coverage in emerging organic material categories around the OLED industry. Such continuous innovation and development will provide strong support for the future growth of the company.
Profit forecast and rating: we are optimistic about the company’s continuous breakthrough and advanced space in the field of OLED organic light-emitting and functional materials. We also firmly believe that the growth bottleneck of steam source is not at present, but there is a very clear rising channel. After more than ten years of technology accumulation and industry breakthrough, with the continuous improvement of AMOLED production capacity and the increasing voice of Chinese panel factory, Jilin Oled Material Tech Co.Ltd(688378) has a good opportunity to break the substantive monopoly of overseas enterprises on OLED supply chain. From breaking the monopoly to being widely used by Chinese panel enterprises, steam source components are only the first step in the growth process of the company. The continuous promotion and application of organic light-emitting and functional materials will face greater space and stronger demand for localization and substitution. Similar second and third steps will be strongly branded into the future growth. We estimate that the profit of the company from 2021 to 2023 is expected to reach 137 million 235 million and 371 million respectively, and the corresponding valuations of the current market value are 32.05, 18.64 and 11.82 times respectively, giving the company a buy rating.
Risk tips: (1) the progress of cooperative development between the company and downstream panel plants is less than expected; (2) Overseas material monopoly enterprises restrict and Sue the company in some special patent layout; (3) Downstream consumer electronics and various display terminal industry applications are affected by negative factors such as economy and epidemic situation, resulting in less than expected demand; (4) The company’s own technology upgrading and iteration cannot follow up the market demand, which may lead to the decline of competitiveness and market share.
