Panel prices fell nearly 40% in 4 months, why can BOE still make 20 billion against the trend?

Panel prices, which have been falling since August, do not seem to have had much impact on 000725.SZ.

The net profit of BOE exceeded 20 billion yuan in the first three quarters of 2021?

Source: announcement.

On the evening of October 28th, BOE disclosed that its revenue in the first three quarters of 2021 was 163.278 billion yuan, up 72.05% from the same period last year, while its net profit was 20.015 billion yuan, up 708.43% from the same period last year.

Of this total, the net profit of returning to the mother in the third quarter was 7.253 billion yuan, up 441.14% from the same period last year, but slightly down 4.3% from the previous quarter.

Chinanews.com noted that prices of large-size TV panels and small and medium-sized pen panels have fallen across the board since August, with TV panel prices falling by as much as 30-40 per cent in the past four months, according to TrendForce data.

Affected by this, TCL Technology (000100.SZ), which is called "panel duo" with BOE, has just handed in an embarrassing "report card", and its net profit has nearly halved in the third quarter compared with the previous quarter.

As the panel enters the downward cycle, why can BOE "take care of itself"?

Full-size coverage to resist the risk of price reduction, the transformation of the Internet of things helps to cross the cycle.

In the previously disclosed performance forecast for the first three quarters of 2021, BOE said that in the first half of the year, the prices of various products such as IT and TV rose to varying degrees due to continued strong demand and the shortage of raw materials such as IC. In the third quarter, due to shipping congestion and rising logistics costs, affecting the willingness of downstream customers to prepare goods, the prices of TV products were structurally adjusted.

IT products remain stable thanks to better demand and supply concentration.

Chinanews.com noted that large-size TV panels bear the brunt of the panel "price decline" since August, while the price reduction of small and medium-sized IT panels is relatively small.

TrendForce's latest October quotation shows that 32-inch and 43-inch TV panels fell by about $10 to $20 a month, while large panels over 50 inches fell by $30, while 11.6-inch pen panels fell by only $1.50.

It is reported that BOE's display business covers mobile phones, tablet computers, notebooks, monitors, vehicles, electronic signage, splicing, industrial control, wear, VR/AR, electronic tags, white electricity, medical, mobile payment, interactive whiteboard and other display device products, with full coverage of large, medium and small sizes, and in recent years continue to enhance the proportion of small and medium-sized products to enhance risk resistance.

On the other hand, BOE continues to promote the "1x 4N" aircraft carrier group strategy. In addition to the "panel duo", BOE is also positioned as an Internet of things company that provides smart port products and professional services for information exchange and human health.

With the continuous progress of 5G, artificial intelligence, big data and other technologies, the digital transformation of various industries has entered an accelerated period, which has brought a good opportunity for the transformation and development of the Internet of things.

In the first three quarters of 2021, JD.com Fang's wisdom innovation career and smart medical industry made rapid development, continuously promoting the transformation process of the Internet of things, and providing strong support for its "traversing" cycle.

2.5 billion Construction of on-board display project Smart car couplet products go global.

On October 29th, BOE also disclosed the construction announcement on the Chengdu vehicle display project base project. it is reported that the total investment of the project is 2.5 billion yuan, and the main products are 5-35-inch vehicle display modules, which are expected to be put into production by the end of 2022. After reaching production, the annual production of car display screen is about 14.4 million.

With the progress of on-board display technology and the rapid development of the new energy vehicle industry, smart car association has become the development trend in the future, the announcement said.

On the one hand, it is to improve the rate of screen, on the other hand, large screen, long-connected screen and multi-connected screen have become powerful measures to attract consumers.

The BOE Chengdu vehicle display project will create an upstream industrial chain cluster that is conducive to medium-and long-term development, and more effectively support the development of independent business on the company's industrial chain.

In fact, as BOE continues to launch Internet of things solutions in smart car couplet, smart retail, smart finance, industrial Internet, smart park and other application scenarios, the company's strength in smart car couplet and high-end car market can not be underestimated.

In early 2021, BOE said on the investor interactive platform that in recent years, the company has focused on the layout of large-size on-board display products, according to data from third-party agencies, as of the first three quarters of 2020, the company has ranked second in the world in the field of large-size vehicle display (8 inches and above).

In the field of smart car couplet, BOE has launched OLED taillights with 12.3inch flexible vehicle triple screen, flexible transparent A-pillar, 2000nits brightness, smart dimming glass, augmented reality HUD and other products, which have been used in China, the United States, Germany, the United Kingdom, Japan, South Korea and other countries.