the program will especially ease pressures from high inventory in LED chips

Liu Liang, an analyst at Industrial Securites has pointed out that subsidies for LED industry would have similar effect, and the industry chain will benefit from the policy. While the general lighting market, which includes lighting sales, manufacturing, and home appliances, would also be stimulated. China was reported excessive production capacity in LED industry, the program will especially ease pressures from high inventory in LED chips.

 In order to improve the quality of LED lighting subsidies’ beneficiaries, China’s National Development and Reform Commission plans to restart the bidding for the SSL Lighting Product Subsidy. On July 25-26, the commission will accept withdraws from companies that have entered the bidding in February, which is good news for Taiwanese upstream and midstream LED firms.

According to LEDinside survey, the new bidding forbids companies to jointly bid, which is good for large-scale companies and will help keep the bidding price and the quality close, and therefore, Taiwanese companies with focus on the upstream and midstream will have an edge in the bidding. It is estimated that the subsidy amount for the new bidding may amount to at least RMB 1 billion.

LED-related stock prices began to rebound since last week – aside from Everlight (2393) stock price dipped 0.74%, stock prices of Epistar (2449), Lextar (3698), Unity Opto (2499), Formosa Epitaxy (3061) and Genesis Photonics (3383) have seen increases in the past week. In particular, Epistar’s stock prices went up 4.24% in the past week, the strongest among the peer companies.