Australia
China
India
Indonesia
Japan
Malaysia
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
As the demand for innovative consumer electronics and advanced visual experience is on the rise, the Asian display industry seems poised for fruitful times ahead. The presence of highly established electronic manufacturers in China, South Korea, and Japan strengthens Asia’s position in the global display industry.
According to Maximise Market Research, the Asia-Pacific flat panel display market is likely to grow at a CAGR of 8.9% from 2022 to 2029 to reach $120.26 bn. The Asia display market witnesses maximum demand from laptops, smartphones, tablets, televisions, and digital signage manufacturers.
Further, Markets and Markets research indicates that cost-effective production facilities in the region coupled with technological advancements and government incentives make Asia ideal for large-scale display panel production. Moreover, the increased demand for home entertainment during the Covid-19 pandemic fuelled the growth of the industry.
According to experts, advanced display technologies like Quantum Dot, AMOLED, OLED, and Micro LED will shape the industry in the future. Also, virtual reality (VR) and augmented reality (AR) pave the way for more opportunities.
However, as OLED and Quantum Dot are advanced technologies and high in demand, companies charge a premium, while demand for LCD panels is weakening. Consequently, LCD panels are witnessing a consistent price decline. Such price disparities in LCD panels and other high-tech panels can have an adverse impact on the overall market.
How to invest in the Asia Display industry?
There are several electronic giants in Asia that manufacture high-end display panels by adopting innovative technologies. Considering the growth prospects of the Asian display industry, investors may want to tap into these lucrative opportunities.
Here’s our list of four such stocks that investors can look at:
Samsung Electronics (Samsung Display Corporation)
Samsung Display Corporation is a subsidiary of Samsung Electronics Co. The latter is the parent company which is listed on the Korean Stock Exchange. Samsung Display sells display devices with OLED and QD-OLED technology.
In April 2023, Samsung Display announced plans to invest KRW 4.1 tn ($3.14 bn) in South Korea until 2026 to make advanced organic light-emitting diode (OLED) display panels used in tablets and computers. With the move Samsung Display wants to strengthen its profile in the OLED panels market.
For the fiscal year ending December 2022, Samsung Display saw a year-on-year revenue increase of 8.4% to KRW 34.4 tn ($26 bn) on the back of its massive supply of the premium low-temperature polycrystalline OLED (LTPO OLED) panels to iPhone 14 Pro. Additionally, the company’s operating income for the year climbed 33.4% to KRW 6 tn ($4.5 bn).
With a market capitalisation of KRW 467.527 tn ($350 bn), the parent company, Samsung Electronics is listed on the Korean Stock Exchange (005930.KS). Its shares surged 10.65% over the past one year. Samsung Electronics has a PE ratio of 13.06 and a price-to-book ratio of 1.20.
BOE Technology (China)
Beijing-based BOE Technology Group is one of the largest liquid crystal displays (LCD) panel maker in the world. Founded in 1993, BOE primarily produces LCD panels for flat-screen TVs, large monitors, and smartphones. The company has production facilities in Beijing, Chongqing, Hefei, and other cities, while its research centers are in the US and Japan.
The company saw an 18.6% year-on-year drop in its revenue reaching 178.4 bn yuan ($24.26 bn) in the fiscal year ended December 2022. During this same period, BOE Technology’s operating income dropped to 3.5 bn yuan ($0.48 bn) from $41 bn yuan ($5.6 bn) posted in the same period last year, primarily due to large impairment losses.
BOE Technology, with a market capitalisation of 150.07 bn yuan ($20.57 bn), has its shares traded on the Shenzhen Stock Exchange (000725.SZ). The company’s stock climbed 11.27% over the past year. BOE Technology shares have a PE ratio of 49.50 and a price-to-book ratio of 0.715.
Sharp Corporation (Japan)
Headquartered in Sakai-Ku, Osaka, Sharp Corporation is a Japanese electronic giant. Besides manufacturing industrial and commercial equipment, Sharp is also one of the leading producers of LCD displays used in consumer electronics, automotive, and home appliances. Its display products include TFT-LCD panels, video walls, interactive displays, and windows collaboration display. Besides Japan, it has several manufacturing facilities in Malaysia, Indonesia, and Poland.
The company saw a 2% year-on-year increase in its revenue, reaching 25 tn yen ($160 bn) in the fiscal year ended March 2023. Sharp’s Display Device unit contributed nearly 34% of the company’s total revenue. During the period, the sales from this unit rose 6% year-on-year to 859.6 bn yen ($5.67 bn), led by the growth in medium-sized panels. At the same time profit from the Display Device unit surged to 20.3 bn yen ($130 mn) from 1.6 bn yen ($11 mn).
Sharp Corporation, with a market capitalisation of 598.76 bn yen ($3.97 bn), has its shares traded on the Tokyo Stock Exchange (6753.T). Over the past year, the company’s stock has seen a 4.5% decline. Sharp Corporation shares have a price-to-book ratio of 2.14.
LG Display (South Korea)
Headquartered in Seoul, LG Display Company is a manufacturer and supplier of thin-film transistor liquid crystal displays designing flexible displays, organic light emitting diode (OLEDs), and other display panels. The company has operations in China, the US, Singapore, Japan, Malaysia, and Germany. LG’s display panels are used extensively in smartphones, laptop screens, desktop monitors, as well as medical equipments.
The company saw a 12.5% year-on-year decline in its revenue, reaching KRW 26.15 tn ($20 bn) in the fiscal year ended December 2022. During this same period, LG Display posted an operating loss of KRW 2 tn ($1.5 bn) compared to a KRW 2.2 tn ($1.7 bn) operating profit reported in the same period last year.
LG Display, with a market capitalisation of KRW 4.755 tn ($3.6 bn), has its shares traded on the Korea Stock Exchange (034220.KS). Over the past year, the company’s stock has seen a 16% decline. LG Display shares have a price-to-earnings ratio of 48.5 and a price-to-book ratio of 0.49.
Editor’s note: All stock movement figures as of November 13, 2023.
