What They Say
LGD said that large OLED capacity in Paju & Guangzhou i s 140K substrates/month to allow 7-8 million panels in 2021 up from 4.2 to 4.5 million this year (originally planned for around 6 million). There is strong demand for 48″ panels for gaming, but Guangzhou has been optimised for 77″ MMG, so ramping up 48″ production is tricky. The firm is trying to produce the 48″ in Paju, as well, to boost capacity, but next year.
Some Korean LCD capacity will be converted from TV to IT products. There will be a continued development of the LCD IT application business. The current capacity at G7 in Paju is around 80K to 90K substrates per month.
LGD so far see limited market success for miniLED in TV and will continue to push the advantages of OLED.
What We Think
Gartner recently forecast that IT spending would increase 4% next year, so a continued focus on IT applications makes a lot of sense for LGD. I still think the firm may have a challenge to maintain its profits while it ramps up OLED production in China. The firm may have to ‘hold its nose’ and cut panel prices to drive up demand and then ease prices back up again. It’s going to be a delicate operation. (BR)
