Firm benefits from LG InnoTek’s exit from LED business

Image: LG Display

South Korean LED firm Wooree E&L has secured half the supply of LED module used by customer LG Display, TheElec has learned.

People familiar with the matter said Wooree’s LED modules currently accounts for around 50% of those used by the South Korean display panel maker.

LED modules are used as the backlighting unit in liquid crystal display (LCD) TVs, notebooks and monitors.

The modules are supplied to LG Display, which in turn supplies the display panels that use them to LG Electronics, Dell and HP.

Wooree E&L expected to see growth in the second quarter as it did in the first. IT products continue to be in high demand from the COVID-19 pandemic.

The company also received more orders for its LED modules since last year after LG InnoTek decided to exit the business in October, 2019.

Last year, Wooree’s LED modules were used by 60% of LG Display’s LCD for monitors; 30% for notebooks; and 40% of signage.

Wooree previous ran 18 LED module production lines at Vietnam and China but it is adding two more for a total of 20 lines, which will allow it to manufacture 4 million light bars per month.

The company has already won enough orders for all 20 lines to operate.

However, the balance between supply and demand for display driver ICs will effect its profits in the second half of the year. Demand for system memory semiconductors are increasing from electric cars and this could cause a shortage of display driver ICs.

Wooree is also hoping for increased demand from high-end products with high color expression and less blue light. It is developing 4-in-1 package and MiniLED module in preparation of this demand.

In the first quarter of the year, the company recorded 35.6 billion won in sales and 1.9 billion won in operating income, an increase of 32% and 2127%, respectively, from a year ago.

The firm’s factories ran at 72% capacity during the quarter, more than double the rate of 30% it ran them between 2018 and 2020.

In 2020, Wooree recorded 122.3 billion won in sales and 3.3 billion won in operating income, a rise of 8% and drop of 5% from 2019. The firm saw sales and profits nosedive in the first half of 2020 but this recovered in the second half.

Meanwhile, rival Seoul Semiconductor’s LED modules last year accounted for 80% of those used in LG TVs. It was 30% prior to LG InnoTek’s exit from the business.

Image: Wooree E&L

Source: THE ELEC, Korea Electronics Industry Media(http://thelec.net)