Winter is here! Several LED companies have entered bankruptcy liquidation proceedings!

Recently, the LED Industry / Supply chain has seen a spate of operational risk events, with several companies successively entering judicial liquidation proceedings.

Shenzhen Lijing Optoelectronics in Bankruptcy Liquidation

According to the National Enterprise Bankruptcy and Reorganization Case Information Network, on September 7, the Bao’an District People’s Court of Shenzhen ruled to accept the bankruptcy liquidation application filed by Shenzhen Lijing Optoelectronics Technology Co., Ltd.; on September 14, it appointed Beijing Long’an (Shenzhen) Law Firm as the administrator. The deadline for filing claims is October 29, and the first creditors’ meeting is scheduled for November 9. This bankruptcy liquidation petition was submitted to the court by two individual creditors. (Note: The court’s acceptance of the bankruptcy liquidation application does not equate to a formal declaration of bankruptcy.)

Lijing Optoelectronics enjoys a modest reputation within the industry. Founded in 2004, this high-tech enterprise was once a benchmark player in China’s LED rental display market, specializing in outdoor full-color screens, stage‑rental displays, and creative display solutions. Its products were extensively exported to Europe and North America, and it undertook major projects such as the Beijing Olympics and the Shanghai World Expo. With a registered capital of RMB 57.03 million, the company pioneered advancements in die-cast aluminum enclosures and distributed power supply technologies, setting new standards for the rental‑display sector.

Even before the bankruptcy proceedings were initiated, Lijing Optoelectronics had already been grappling with mounting risks. Public court records reveal that the company is involved in more than 180 legal cases, including labor disputes, contract disputes, and enforcement proceedings, with defendants outnumbering plaintiffs by a significant margin.

Reportedly, the company operates a proprietary manufacturing base under a heavy‑asset model, facing persistent pressure from industry-wide price wars that have squeezed profit margins. In addition, funding for cultural, tourism, and commercial performance projects often requires substantial upfront investment, while lengthy payment cycles further strain cash flow. Coupled with volatile overseas orders, accounts receivable continue to tie up working capital, gradually accumulating debt risks.

Furthermore, the official WeChat account “Lijing Optoelectronics LED” published an internal notice in November 2025 regarding a dispute involving senior management misconduct, which external observers view as another indication of governance instability.

Several LED Lighting Companies Enter Bankruptcy Liquidation Proceedings

Notably, recently, numerous small and medium-sized lighting enterprises across China have encountered similar challenges.

For instance, according to information from the National Enterprise Bankruptcy and Reorganization Case Information Network, Zhejiang Hongyue Semiconductor Devices Co., Ltd. (hereinafter referred to as “Hongyue Semiconductor” or “Hongyue Company”) has officially entered bankruptcy liquidation proceedings.

The Changshan County People’s Court of Zhejiang Province, upon application by creditor Changshan Industrial Development Group Co., Ltd., ruled to accept Hongyue Company’s bankruptcy liquidation case and appointed Zhejiang Wuzheng Law Firm as the administrator on the same day. According to the court announcement, creditors are required to file their claims with the administrator by October 30, 2026, and the first creditors’ meeting is scheduled for 9:30 a.m. on November 6, 2026.

According to business registration records, Hongyue Semiconductor was established on March 28, 2024, with a registered capital of RMB 50 million. Legal representative Liu Jinsong holds 95% of the shares, while Liu Yang holds the remaining 5%. However, both shareholders have yet to make any actual capital contributions. The company’s 2025 annual report indicates that its operating status remains “under preparation,” with only eight employees covered by social insurance.

Its business scope encompasses the manufacture and sale of specialized equipment for semiconductor devices, semiconductor lighting components, integrated circuits, integrated circuit design, optical communication equipment, and metal wire ropes and related products, among other areas.

Looking at its project progress, just two months after its establishment, in May 2024, the company filed a project proposal to produce annually 40 million ICs, 80 million meters of bonding wires, and 8,500kk LED light sources. Yet more than a year after filing, Hongyue Semiconductor has already entered bankruptcy review proceedings, with no evidence indicating that these projects have progressed.

In addition, Zhongshan Dikai'er Lighting Appliances was also ordered into bankruptcy liquidation by the Zhongshan Intermediate People’s Court on August 6, with the deadline for filing claims set for October 14.

Against the backdrop of ongoing reshuffling within the LED Industry / Supply chain, both long-established industry leaders and newly launched startups alike are confronting multiple challenges—cash flow constraints, order fluctuations, and internal governance issues. As the era of rapid, unregulated expansion draws to a close, businesses now face increasingly stringent demands on their financial management and risk-control capabilities.