Optical film is the preparation and plating of more than one layer of electrical film or metal film on optical components or independent substrates. The purpose is to change the transmission characteristics of light waves, such as light projection, reflection, absorption, and scattering. It is mainly used in LCD backlight modules, and finally in the manufacture of liquid crystal modules. As an important part of the LCD panel, the backlight module can provide a light source with sufficient brightness and uniform distribution. Because the LCD panel itself has no light performance, the backlight module is an important component that provides a stable light source. According to its function, it can be divided into diffusion film, brightness enhancement film, reflective film, etc., so that the LCD can display images normally. As the demand for home appliances continues to grow, the market demand for backlight modules and optical films is also growing.
In recent years, driven by the growth of the global terminal electronic product market, the liquid crystal module industry has risen in response to the trend, thereby promoting the growth of the optical film market. From the perspective of the industrial chain, the upstream of the optical film industry chain is composed of basic materials, such as base film, particles, solvents, etc.; the midstream is the main body of the optical film industry, mainly including display films, protective films, decorative films, and partitions. Thermal film; downstream is terminal applications, widely used in display panels, automobiles, consumer electronics and, construction industries.
In recent years, China's optical film industry has achieved steady growth, mainly because the steady growth of downstream LCD panel shipments and the continuous advancement of local enterprise technology have accelerated the pace of domestic localization. The data shows that the market size of the national optical film industry has increased from 27.18 billion yuan in 2014 to 35.4 billion yuan in 2019, an increase of 8.99% over the previous year. In the next five years, China's optical film market will maintain a compound annual growth rate of 7%, reaching 46.38 billion yuan by 2023.
Specifically, the continued growth of the optical film industry market has been driven by many aspects.
Downstream market demand drives industry growth. China has the largest consumer market group and has also become the world's largest producer of consumer electronics. As China’s per capita income continues to increase, consumers continue to raise the quality requirements of household appliances such as LCD TVs, mobile phones, and computers. The frequency of replacement is accelerating, and the demand remains strong. This will drive the expansion of the LCD panel industry’s production capacity and increase the demand for display optics. Market demand for raw materials such as membranes.
There is strong demand for localized LCD panels. Under the influence of the international trade war, the Chinese government clearly supports the increase of the localization rate of core raw materials in the LCD panel industry to 70%, expressing the strong confidence of the domestic LCD panel industry. At the same time, Chinese LCD panel manufacturers are actively adopting a vertical integration strategy to enhance their competitiveness to continuously replace imported optical films, which will expand the demand for localized supporting facilities. In addition, the market for terminal consumer electronic products is fiercely competitive and prices continue to fall. Terminal manufacturers shift the pressure of falling prices to upstream suppliers. LCD panel companies are looking for low-cost, high-quality upstream raw materials. Therefore, China's domestically produced optical film raw materials have become an alternative to imports, and the development of the local optical film industry welcomes import substitution opportunities.
Domestic technology is continuously upgraded to promote the high-quality development of the industry. Driven by factors such as the industrial chain and policies, Chinese optical film companies continue to break through technical barriers, gradually overcome technological breakthroughs in high-end areas, promote the optimization and adjustment of domestic optical film product structure, and continuously shorten the technological gap with international leading companies, and further improve The added value of optical film products is not only conducive to the improvement of corporate profit levels, but also promotes the development of the optical film industry in the direction of high quality.
Optical films are mainly divided into polarizers and optical film products used in backlight modules.
High-End Backlight Models Are Still Unable to Completely Replace
Reflective films, diffusion films, and brightness enhancement films are the main types of optical films for backlight modules. Looking at the world, the market size of optical films for backlight modules has increased year by year, from 9.1 billion yuan in 2014 to 13.5 billion yuan in 2019. Similarly, the market size of optical films for backlight modules in China has grown with the trend. In 2019, the market size of optical films for backlight modules in my country reached 8.14 billion yuan, a year-on-year increase of 8.1%. At present, domestic reflective film and diffuser film have the advantage of import substitution. Some domestic manufacturers have realized the substitution of foreign products in reflective film and diffuser film products, but the brightness enhancement film technology is relatively backward. The overall domestic production capacity is similar to that of Japan, South Korea, and Taiwan, but for some high-end products and technologies with special performance requirements, it is not yet possible to completely replace them.
Accelerating Localization of Polarizing Film
The polarizer is mainly made of PVA film, TAC film, protective film, release film, and pressure-sensitive adhesive. The first two are the main raw materials for polarizers, and the cost is 50% and 12% respectively. From the perspective of the overall industry competition, Japanese companies are in the world's leading position in the manufacture of polarizers, especially in the production of TAC films and PVA films required for polarizers, and they have a monopoly in technology and the market. Japan's Fujifilm and Konica Minolta are the world's leading TAC film companies, and the two companies together account for 75% of the global TAC production capacity. In terms of PVA film, Kuraray occupies more than 80% of the global market. Although Japanese companies still occupy the leading position in the TAC and PVA film industries, in recent years, some companies have made certain breakthroughs in the localization of TAC film.
For a long time, the technology and market of optical films have been monopolized by a few manufacturers, and the distribution of market resources is extremely uneven. However, in recent years, many domestic optical film companies have seized the opportunity of the rapid development of the liquid crystal display industry, made great progress by integrating various resources, and gradually realized the substitution of imported products. At the same time, the production capacity of liquid crystal panels is shifting to China, which provides new development opportunities for upstream module and material manufacturers of liquid crystal displays. Nowadays, in the field of optical film, diffusion film, and reflective film have achieved domestic substitution. Many high-generation LCD panel production lines in my country have been put into production, and they have gradually formed an influence worldwide. Generally speaking, the potential space of domestic substitution of optical film in is huge.
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