The Zhitong Finance App learned that Minsheng Securities released a research report saying that Mini LED technology is highly adaptable to the TV scene and is expected to become the preferred solution for TV display technology upgrades. In 2023, under the joint impetus of China's terminal manufacturers and the upstream industry chain, Mini TV shipments will more than double. Considering that the cost reduction potential of the Mini industry chain still has plenty of room to be tapped, against the backdrop of China's TV shipments continuing to bottom out, terminal manufacturers are also willing to use the Mini LED concept to “push new and high sales”, which is expected to jointly drive Mini LED TVs The industrial chain continues to flourish. The brand side recommends Hisense Vision, suggests focusing on TCL Electronics (01070), and the industrial chain side suggests focusing on Zhaochi shares (002429.SZ).

Minsheng Securities's views are as follows:

Mini LED is an upgrade to traditional LCD displays, and has performed well in 23 years.

Under the influence of many factors such as sluggish real estate, the impact of new display products, and the rise of short videos, although total TV market shipments are still in the process of bottoming out, structural changes led by high-end technology continue to be interpreted. Mini LED TVs performed well in 2023. According to Aowei Cloud Network, the penetration rate of Mini LED TVs in China reached 2.9% in 2023, corresponding to 910,000 units shipped, which more than doubled from 2022.

Behind the high increase in shipments is the resonance between cost reduction in the industrial chain and the brand's desire to reduce prices, which is expected to form a good positive feedback mechanism.

For terminal brands, the application of Mini LED modules reduces the value of panels in televisions. At the same time, the gross margin of Mini LED TVs is significantly higher than that of traditional LCD TVs, the cost of backlight modules still has plenty of room to fall, and terminals have a strong desire to promote; for the industrial chain, the value of Mini LED backlight modules is far higher than traditional backlight modules, and the terminal boom can be fully transmitted to all links of the industry chain. Therefore, the bank determines that the cost reduction and terminal price reduction in the Mini LED industry chain is expected to form a good positive feedback mechanism, leading to penetration rates Continued momentum for improvement.

The cost of the Mini backlight is mainly composed of the chip, package, driver, PCB, etc., and there is plenty of room to reduce costs.

Currently, the cost reduction of Mini LED is mainly achieved by increasing the efficiency of the use of individual chips, increasing the light output angle, reducing the direct use area of materials, standardizing production plans, and localizing core devices. According to the bank's estimates, the factory price of a 65-inch 1000 zone Mini TV is expected to drop to around 2,100-2200 yuan in 2025, which is about 25% less room than 2023.

Price is the most sensitive factor in increasing the penetration rate of Mini LED TVs. From a medium-term perspective, there is room for growth of MiniLED TV sales in China more than twice.

The bank believes that the main driving force for increasing the penetration rate of Mini LED TVs comes from: 1) consumers' stickiness for high-quality display results, and 2) the supply side continues to push Mini LED products into the price range of volume. Among them, price is the most sensitive factor in the penetration rate of Mini TVs. According to the bank's estimates, the price of Mini TV terminals may drop by 24.8% in 23-25, and the corresponding penetration rate of 55, 65, and 75+ is expected to rise to 5.4%, 9.1%, and 18.1%. Even if China's TV sales fall to 32 million units in 25, the total sales volume of corresponding Mini TVs is still expected to reach 2.76 million units, with more than double the room for growth compared to 23.

Risk warning: Panel prices fluctuate, the cost reduction process falls short of expectations, and industry competition intensifies.