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China LED industry boom is unabated, creating an increase in low profits
Although the development model of OEM severely crush China LED corporate profits, but the domestic business' confidence in the future of the industry has not diminished. In 2012, January to July, China's LED industry plans to add the total amount of investment still amounts to 125.6 billion yuan, of which more than 40% of the funds will invest in a plurality of industry sector, and even the whole industry chain investment.It is noteworthy that non-LED business invest into the LED industry has become an important available part of LED industry investment, these projects accounted for more than 45% of all investment projects, worth more than 65% of the total investment amount.

China LED industry boom is closely related to government's support. March 2012, China's National Development and Reform Commission clearly will spend 40 billion yuan for the purchase of street LED lights, and provide 30% of financial subsidies to the users of street LED lights. Local governments also will respond, Guangdong Province said that since March 1 this year, the province's lighting all financial investment in the construction and development of new regional planning in all areas of public lighting using LED. In addition, the The favor degree of capital market for the LED market is not reduced, as one of venture capital and private equity industry's most favored investment. In 2011 our country has seven LED industry in the A-share companies to achieve IPO, total financing amounted to 3.625 billion yuan. February 2012 the Commission published the list of enterprises IPO application in the trial, at least nine are LED industry related companies.

China LED companies win in a low profit growth. Data show that during the "Eleventh Five-Year", double the size of the integrated circuit industry, production and sales, respectively, from 2005's 26.58 billion and 70.2 billion yuan, increased to 65.25 billion in 2010 and 144 billion yuan, accounting for global IC market share increased from 4.5% in 2005 to 8.6% in 2010. Domestic market scale of 380 billion yuan from 2005 to 2010, 735 billion yuan, accounting for 43.8% of the global IC market share. In 2011, under the European economic downturn, China's LED and other energy-saving products exports are still have a falling market growth about 25%, LED indoor lighting products production increased 75 percent, prices fell 22%, the output value of 18.6 billion yuan, an increase of 38 %. According to the agency predicted, thanks to government support and lower prices this year, China LED interior lighting output will reach 30.6 billion yuan, an increase of 64%; in 2015 will reach 99.3 billion yuan. In the next four years, indoor lighting production value CAGR reach 52%.