Huawei's folding screen new machine is sold out in seconds. Who is the core component supplier behind it?
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Economic Observer Reporter Zhang Bin At 10:08 on February 25, Huawei MateX2 officially went on sale, with a price starting from 17,999 yuan. Before the sale, Huawei's official mall, JD.com and other e-commerce platforms had made about 5 million reservations. After the launch of the sale, Huawei's official mall, Tmall, JD.com and other e-commerce platforms showed that this new product was instantly "second light".
The MateX2 launched this time is Huawei's third-generation folding screen mobile phone. On the other end of the hot spot market, in the capital market, more attention is which core component suppliers of this mobile phone may become a hot island for investment.
Wang Fang, chief analyst of Minsheng Securities Electronics Industry, believes that the trend of folding screens is unstoppable, and the chain and screen are still the key directions of upgrading.
Yu Chengdong, managing director of Huawei and CEO of consumer business, said at the press conference on February 22 that MateX2 is equipped with a new double-helix water drop chain, which ensures the flatness of the folding screen after expansion and the aesthetics after folding, and achieves the seamless part of the folding chain.
Yu Chengdong said at the press conference that this double spiral water drop chain uses carbon fiber composite materials and high-strength steel. Among them, the carbon fiber composite material used to support the door panel of the ard chain reduces the weight by 75%; the strength of super steel can reach 2100MPa, which is 50% higher than the steel used in the B-pillar of high-safety cars; and the hardness of the zirconium-based liquid metal used in the central axis of the ard chain has tripled.
Chen Hang, an analyst at Founder Securities, believes that Huawei's MateX2 will accelerate the popularization of folding machines. The Huawei MateX2 inward folding scheme released this time will be the beginning of the epoch-making period when the OLED folding screen enters the volume period, opening up a huge industrial imagination space. The chain is the most critical functional part to realize foldable mobile phones, and it is also the most technological part of the folding screen.
In the field of ? chain, analysts of major securities firms will Changying Precision (300115. SZ), Yi'an Technology (300328). SZ), Dongmu Shares (600114). SH), intensive research technology (300709. SZ) etc. are included in the scope of concern. Many investors are very concerned about who is the core supplier of the double-helix water drop chain carried by MateX2?
Who is the MIM supplier?
Founder Securities said that the core technology of folding screen mobile phones is foldable screen, chain and operating system. There are many parts used in the folding screen chain, which has the characteristics of high complexity, high folding life requirements and high product reliability requirements. The cost of BOM (material list) mainly includes MIM (metal injection forming parts) precision processing, liquid metal raw materials, module assembly, etc.
Dongmu Co., Ltd.'s main business is divided into three major sectors: powder metallurgical pressing parts (PM), metal injection forming parts (MIM) and soft magnetic composite materials (SMC). In 2019, Dongmu Co., Ltd. decided to quickly enter the field of MIM through extensional mergers and acquisitions. In August 2019, the company acquired a 61% stake in Dongyu Huajing for 110 million yuan. In December of the same year, the company bought another 14% stake in Dongyu Huajing for 25.2 million yuan, with a shareholding ratio of 75%. In February 2020, the company acquired a 75% stake in Fuchi Hi-Tech for 1.039 billion yuan. Through these two mergers and acquisitions, Dongmu Co., Ltd. can quickly enter the consumer electronics industry and realize the company's strategic layout in the MIM industry.
Dongmu Co., Ltd. said in its semi-annual report in 2020 that during the reporting period, due to the adjustment of the sales strategy of consumer electronics international mainstream brands and related projects related to specific models of domestic mainstream brands, the sales of consumer electronic products reached 518 million yuan, accounting for 39.18% of the company's main business revenue, of which Fuchi Hi-Tech 20 The operating income from January to June 20 years was 473 million yuan (Fuchi Hi-Tech was included in the company's consolidated statement in March 2020, and the operating income from March to June was 378 million yuan).
In addition, in the first half of 2020, Dongmu Co., Ltd. registered and established Lianyungang Fuchi Intelligent Manufacturing Technology Co., Ltd., a wholly-owned subsidiary of Fuchi High-tech, Jiangsu Province, in Lianyungang City, and signed the Investment Agreement on Land Projects in Lianyungang Economic and Technological Development Zone with the Management Committee of Lianyungang Economic and Technological Development Zone in August of that year. It is proposed to use its own or self-financing to purchase 210 mu of land use rights in Lianyungang Economic and Technological Development Zone for the construction of the "Consumer Electronics Precision Parts Automation Production Line Project", with a total investment of 1 billion yuan. It is proposed to register and establish Guangdong Fuchi Intelligent Manufacturing Technology Co., Ltd. in Dongyu City to integrate MIM and consumer electronics. South China Production Base.
According to media reports, after acquiring Dongyu Huajing and Fuchi Hi-Tech, Dongmu Co., Ltd. has become the largest supplier of MIM parts for Huawei's mobile phones and the core supplier of Huawei's second folding screen mobile phone MateXs chain.
In response, the reporter of Economic Observer called Dongmu Co., Ltd. on February 24 to inquire that relevant people in its securities department said that the technology company of folding screen mobile phone chain can do it, and Huawei is also a customer of the company, but it is not clear whether it has supplied MateX2.
The person also said that in terms of MIM parts of foldable screen mobile phones, the company has cooperated with major domestic mobile phone manufacturers, and has supplies to major domestic mobile phone manufacturers. It said that the company was optimistic about the MIM industry, otherwise it would not have spent a lot of money to acquire Fuchi Hi-Tech and build a production base in Lianyungang.
Wang Huajun, an analyst at Zheshang Securities, believes that according to IHSMarkit's forecast, the global folding screen market shipments in 2020 will be nearly 5.2 million units, and it is expected to exceed 50 million units in 2025, and the compound growth rate from 2020 to 2025 is about 57%. DisplaySearch expects that folding screen mobile phones will bloom in 2021. Samsung, Xiaomi, vivo, OPPO and Google will all have folding screen mobile phones. Dongmu Co., Ltd., as one of the two oligarchs in the domestic MIM industry, is expected to continue to benefit.
Who is the supplier of liquid metal?
The cost of MateX2 chain BOM (material list) also includes liquid metals. Liquid metal belongs to amorphous alloys, also known as metal glass. It is a new metal material with glass, metal, solid and liquid characteristics. Because there are no defects such as dislocation, lamination, grain boundary, etc., amorphous alloys show special mechanical characteristics, and their bending strength, tensile strength, elastic deformation, etc. are better than common materials. Liquid metals have been widely used in consumer electronics, new energy vehicle products, headphones, etc., and have begun to show broad application prospects in intelligent manufacturing, high-end sports equipment and aerospace.
When Yi'an Technology was surveyed by institutional investors in December 2020, it said that the company's liquid metal products have been applied in batches in folding mobile phone chains, mobile phone optical brackets, door locks, acoustics and other products. The company provides two liquid metal chains for the largest mobile phone terminal customers in China. The liquid metal FaceID brackets and camera modules produced by the company have been supplied in batches to well-known domestic mobile phone manufacturers such as Xiaomi and OPPO, and liquid metal locks are exclusively supplied to Tesla. The company is the only enterprise in the world that applies liquid metals to the automotive industry.
According to the annual report of Yi'an Technology, the company's liquid metal products from 2016 to 2019 were 31.3085 million yuan, 53.8357 million yuan, 67.4526 million yuan and 72.881 million yuan respectively. In the first half of 2020, "the company's liquid metal product sales revenue was 70.9788 million yuan, an increase of 71.25% compared with the same period last year. The company has also been looking for and nurturing partners to jointly expand the liquid metal market. Yi'an Technology said in December 2020 when it was surveyed by institutional investors.
Recently, Yi'an Technology said in response to investors' questions on the investor interaction platform many times that the company provides liquid metal enamel chains for the largest mobile terminals in China, but does not explicitly provide liquid metal chains to Huawei.
On February 24, the reporter of Economic Observer called Yi'an Technology. Relevant people from its Securities Department said that we are now providing liquid metal chains to major domestic mobile phone manufacturers, but due to confidentiality regulations, which specific company is not convenient to disclose. The liquid metal chains of the previous generations of the largest mobile phone manufacturer in China are also supplied by us. However, the company's liquid metal is not directly handed over to the mobile phone manufacturer, but to the downstream manufacturer for assembly, and the finished product is handed over to the mobile phone manufacturer after assembly. The person did not disclose which company the downstream manufacturer of liquid metals is.
The above-mentioned relevant people from the Yi'an Science and Technology Securities Department also said that the performance of the company's liquid metal products in 2020 is not bad, better than in 2019. For details, please refer to the 2020 annual report released later. If the customer's market is not affected by other factors, the company's liquid metal products will also have a good development this year (2021).
In addition, Yi'an Technology has also signed cooperation agreements with many companies and governments to expand the industrialization scale of liquid alloys. According to the company's announcement, in July 2019, Yi'an Liquid Metals, a wholly-owned subsidiary of the company, signed a project investment framework agreement with the Qingxi Town People's Government of Dongyu City, with a total investment of 380 million yuan to jointly build a liquid metal project. In March 2020, the company and Sanxiang New Materials (603663). SH) Sanxiang Zirconium and Magnesium, its industrial fund, signed a project cooperation investment agreement to jointly invest in amorphous alloys (liquid metals) projects with a registered capital of 100 million yuan at a ratio of 40%:60%.
It is worth mentioning that Yi'an Technology intends to list the liquid metal business separately." If there is an opportunity, the company certainly wants to use the platform of the capital market to do a good job in the liquid metal industry. Yi'an Technology said in December 2020 when it was surveyed by institutional investors.
The trend of folding screen is irresistible?
2019 is the first year of folding screen products, and since then, major brand manufacturers have followed up and released them one after another. As far as product form is concerned, the folding form of mainstream folding screen mobile phones in the current market is roughly divided into three types: horizontal external folding, horizontal internal folding and vertical folding. At present, Samsung? GalaxyZFold series mainly focuses on horizontal inverted folding, GalaxyZFlip? The series mainly focuses on a portable vertical folding scheme.
The electronic team of CITIC Construction Investment believes that folding screen will become the general trend of the development of the smartphone market in the future, and the folding screen products of many manufacturers will be released one after another in 2021. Under the leadership of Samsung, Huawei and other brands, the folding screen market has initially completed consumer education. At the same time, it has made major breakthroughs in mass production, application ecology and other difficult problems, and is about to usher in rapid growth. Apple is also actively carrying out research and development of folding screen products.
CITIC Securities also continues to be optimistic about the trend of folding mobile phones. It said that according to Omdia's forecast, the shipments of foldable display panels from 2020 to 2027 will be about? 4.2 million units are expected to increase to 73.6 million, with a market penetration rate of 4.91% and a CAGR of 150%. Huawei MateX2 adopts an internal folding scheme this time. The multi-form folding screen scheme will coexist for a long time, corresponding to different diversified needs (multi-functional VS portable, etc.).
Chen Hang, an analyst at Founder Securities, believes that the Huawei MATEX2 internal folding plan released this time will be the beginning of the epoch-making period for OLED folding screens to enter the volume period, opening up a huge space for industrial imagination.
Wang Fang, chief analyst of Minsheng Securities Electronics Industry, believes that the trend of folding screens is unstoppable, and the chain and screen are still the key directions of upgrading. Foldable mobile phones break the screen-to-body ratio limit at one stroke. Foldable mobile phones are the most important upgrade direction of the appearance of smart phones in the next three years. Compared with ordinary mobile phones, the cost of BOM of folding mobile phones has increased by about 30%, including 70% in display screen costs, and the cost of batteries and rotating shafts has increased by 120%. With the gradual reduction of future prices, terminal sales are expected to increase significantly, bringing a new round of growth to the industrial chain.