Nationstar Optoelectronics invests 1.9 billion yuan to strengthen its core business

According to the announcement on August 7, NationStar Optoelectronics plans to invest no more than RMB 1.9 billion over the next five years in the NationStar Optoelectronics Jili Industrial Park project. The investment will mainly be used to build R&D and production facilities, as well as advanced LED packaging and application production lines, with a focus on producing RGB fine-pitch, Mini LED, and TOP LED products. These products are mainly used in ultra-high-definition and new smart displays, intelligent vehicle lighting, smart home, UV sterilization, and other fields.

NationStar Optoelectronics stated that, in accordance with the five-year construction plan, site infrastructure work will be completed in Years 1 to 3. Equipment will be installed and operational production will commence from Year 2 to Year 5, with the equipment investment schedule adjusted overall based on market demand.

Nationstar Optoelectronics stated that this investment to expand production capacity is based on the rapid iteration and development of the market and technology in the LED industry, especially in the company's specific sector, with favorable growth expectations. It is necessary for the company to continuously increase its production capacity layout for products such as Mini LED, small-pitch displays, and TOP LED. In particular, there are broad market prospects in high-end display applications over the next two to three years.

NationStar Optoelectronics stated that this project plans to build an advanced LED device packaging production line, which will help enhance the company's response speed to market demands, further consolidate its advantageous position and leading role in the display device packaging industry, and improve its comprehensive competitiveness and international influence. Meanwhile, the increasingly improved level of automation management will help the company adjust its product structure in a timely manner, optimize production capacity layout, and significantly enhance its risk resistance capability.

Previously, NationStar Optoelectronics stated on the investor interaction platform that it established a Mini Manufacturing Department last December, and its product process technologies are now mature. This year, major packaging plants and chip manufacturers are actively laying out Mini LED. As the pandemic has affected Mini LED shipments, a period of rapid growth is expected to gradually emerge after the pandemic ends.

"Currently, Mini LED displays mainly target the large-screen market. The latest Mini LED products can achieve 4K resolution on 100-inch screens, overlapping somewhat with home TV screens," stated Nationstar Optoelectronics during an institutional survey. "Mini LED can effectively address the lifespan issues of OLED screens, offering greater technical and cost advantages in large-size applications and mass production."

NationStar Optoelectronics stated that its UV LED orders and shipments have increased to a certain extent compared to last year, but the overall sales proportion remains small. The company will continue to actively expand in the UV niche market to explore greater potential for sales growth.

However, NationStar Optoelectronics' performance in the first half of this year decreased by 65%-75% compared to the same period last year, with a net profit of RMB 49.3779 million to RMB 69.1291 million.

Nationstar Optoelectronics stated that the COVID-19 pandemic caused a phased impact on the economic environment, affecting supply chains, personnel management, work resumption progress, and order demand. This led to a phased decline in domestic and international order demand for its products due to the pandemic, with an increased proportion of industry exports shifting to domestic sales.

"To capture a share of the limited market demand during the pandemic, prices for some core market products have decreased," pointed out NationStar Optoelectronics.