On August 5th, ZJLT Optical Technology Group, a manufacturer of reflective strip prisms, lenses, high-precision glass wafers, and high-precision glass aspheric lenses in China, and optical component suppliers of well-known enterprises such as Apple, Huawei, and LG, successfully IPO.
China's domestic optical supply chain began to rise
The so-called optical components are parts that play an imaging role. At present, such parts can be mainly subdivided into categories such as lenses, prisms, and mirrors, and are used in many products such as cameras, telescopes, mobile phone cameras, and optical instruments. Especially in high-end applications, it is a very precise component, and the technical barrier is also extremely high.
With excellent technical capabilities, ZJLT began to supply Austria Micro Systems in 2017, entered the Apple industry chain, and established a stable customer relationship with it.
Because of its own barriers in strip prisms, glass aspheric lenses, glass wafers and imaging prism products, ZJLT Optics has established a certain market position in the two market segments of smart phones and optical instruments. For example, it occupies about 80% of the market share in the double-sided infrared reflective long prism products of 3D structured light face recognition components.
ZJLT's revenue performance in the first three years is very impressive. From 2017 to 2019, its operating income has stabilized at more than 300 million yuan, and its net profit has stabilized at more than 110 million yuan.
Despite the impact of the smartphone market decline in recent years, ZJLT's revenue has fluctuated slightly. But after the epidemic, a new wave of growth will emerge, driven by the commercial use of 5G communication technology.
IDC statistics predict that global smartphone shipments will be 1.39 billion units in 2020, and this data will grow to 1.48 billion by 2023. Driven by the market, ZJLT's revenue is bound to increase accordingly. However, the contribution of more than half of the revenue, the growth and decline of the consumer electronics market has a considerable impact on the total revenue of Lantech Optics. In this regard, ZJLT is also prepared.
From the perspective of its revenue structure, its business composition is not single. ZJLT's data shows that in the past three years, the income of its products in the field of optical instruments has been increasing at an annual growth rate of 10-20 million yuan, and its proportion in the main operating income has increased from 19.41% to 32.65%.
Behind the declining revenue data, this contrarian growth segment business will undoubtedly become another powerful business growth point for ZJLT. Optical instruments have always higher requirements for technology and components than consumer electronics, and their ability to penetrate the optical instrument market step by step also reflects ZJLT's expertise in the field of prism processing and the stable, reliable, and cost-effective products of ZJLT.
A company's deep accumulation of products and technologies is one of the key factors affecting its later revenue growth.
In addition to consumer electronics and optical instruments, the downstream market for ZJLT's optical positioning includes automotive rearview mirrors and semiconductor manufacturing. But at present, the consumer electronics, especially the smart phone market, contributes the most to its revenue, which is also related to its core lifeline.
Due to the huge shipment volume, the subtle changes of smart phones can "bring" high-share market segments that attract attention. Therefore, it leads the technological development trend of the entire industry chain and forces many underlying technological innovations. Taking optical components as an example, due to the increasing application of multi-camera, face recognition, and under-screen fingerprint functions, its technology and raw materials are constantly changing.
Technological changes are shifting geographically in the industrial chain, especially in the context of the increasing market share of Huawei and Xiaomi products and the implementation of domestic 5G commercialization. The domestic optical component design and manufacturing industry chain has also ushered in a new wave of shocks and opportunities.
The more significant change is that with the development of smart phones to be thinner and lighter, optical components need to be refined and miniaturized on the basis of ensuring the original quality and reliability.
In addition, under the trend of increasingly powerful mobile phone camera functions, the downstream pursuit of periscope cameras will open up a broad market for the development of miniature prisms. Keeping track of industry development to do technological research and development is the basic quality of technology enterprises. ZJLT has already had a layout. Combined with industry development forecasts and strategic planning, as well as customer feedback served, ZJLT is still making active technical reserves.
Last year, it started the layout of optical components used in the production of high-magnification zoom lenses for smart phones and optical communications. In the process of continuous R&D and testing, it has self-developed super-efficient mass-batch gluing cutting, mold manufacturing compensation and other process technologies.
Periscope cameras gradually become the mainstream of mobile phone cameras
At the same time, in the continuous application of semiconductor manufacturing technology to the company’s R&D and production process, it has explored high-precision medium and large-size ultra-thin wafer processing technology, WLO glass wafer (optical components produced through wafer-level processing). Hole technology and optical-grade high-precision lithography technology, etc., will undoubtedly be condensed into its "weapon" to compete in the future high-end application markets such as smart phones and AR/VR.
The global optical component industry was first concentrated in Germany and Japan. In particular, precision optical components were basically monopolized by German and Japanese companies. The ability of Chinese optical component manufacturers to enter the high-end market and be technologically advanced will be a major disruption to the existing The market structure plays a key role.
It is not just ZJLT Optics. In the same industry, Chinese optical component manufacturers with different businesses such as SJ Optics, WF Optics, YZ Optics have formed a joint effect. Especially in recent years, China's optical processing plants have gradually narrowed the gap with the international advanced level, and the industrial agglomeration effect formed by them has become more and more obvious, and the opportunity to subvert the international pattern in one fell swoop is approaching.