Lite Optoelectronics Chuanglite Optoelectronics Science and Technology Innovation is insufficient Customer suppliers overlap the independence of operations is questionable

Yunchuang Finance / Zhang Yan

Shaanxi Lite Optoelectronic Materials Co., Ltd. (hereinafter referred to as "Lite Optoelectronics") is mainly engaged in the research and development, production and sales of OLED organic materials, as the main supplier of DOMESTIC OLED organic materials, the company's customers include such as BOE and other well-known global semiconductor display products leading enterprises.

According to the data, Wright Optoelectronics was established in 2010, at the beginning of its establishment, Wright Optoelectronics is mainly engaged in chemicals, electronic chemicals trade, since 2018, the company has truly realized its own PRODUCTION of OLED terminal materials, Lite Optoelectronics from trade suddenly shifted to the production of OLED terminal materials with higher technical content, and the nature of its main business before and after changes has attracted widespread attention from the market.

However, the business transformation of Wright Optoelectronics is inseparable from the help of Material Science Co. and Ltd, and it is precisely because of this that the outside world has serious doubts about the technical sources of Wright Optoelectronics, and at the same time, its relationship with MS is also quite interesting.

Technology relies on "charity", and science and technology are insufficient

As a company that started with trading business, Lite Optoelectronics suddenly established a development strategy with OLED organic materials as the core in 2016, and began to seek to enter the field of OLED terminal materials, however, Lite Optoelectronics to achieve the transformation from trade to production, technology is the number one problem it faces, for this reason, it found an MS company that supplies terminal materials for the BOE Ordos factory, and wants to seek cooperation opportunities.

After consultation with MS, MS Company, through the joint venture with Lite Optoelectronics, MS Sent a large number of OLED terminal materials related technologies to Lite Optoelectronics, including: MS is responsible for the research and development of OLED materials, technical guidance for manufacturing, sales business support for factory production products, MS Korea is also responsible for training the main technical personnel of Lite Optoelectronics.

Relying on the relevant technology of OLED terminal materials injected by MS, the OLED terminal material revenue of Lite Optoelectronics has become its largest source of income in recent years, from 2018 to 2020, the company's OLED terminal material products achieved revenue of 0.62 billion yuan, 155 million yuan and 192 million yuan, accounting for 75.82%, 86.29% and 78.41% of the total revenue of each period, that is, More than half of the company's revenue over the past three years has been built on MS's technology.

In summary, the dependence of Wright Optoelectronics on the core technology of MS Company is very obvious, the company is only on the basis of MS technology, through independent research and development, has developed a variety of products, but with the future of downstream products updated iteration, in the lack of basic technology development capabilities, Lite Optoelectronics can timely adapt to larger market demand changes? The core technology relies on the "handout" of external companies, and the scientific and technological achievements of Wright Optoelectronics are naturally doubtful.

It is worth mentioning that THE FIRST BIG CUSTOMER OF WRIGHT OPTOELECTRONICS WAS INTRODUCED THROUGH MS, AND AFTER THE COOPERATION BETWEEN THE TWO PARTIES, MS COMPANY GRADUALLY TRANSFERRED THE BUSINESS OF SALES TO BOE TO ITS JOINT VENTURE COMPANY WITH WRIGHT OPTOELECTRONICS, AND NO LONGER SOLD TO BOE IN CHINA. However, in June 2020, Lite Optoelectronics completed the acquisition of MS Company holding 49% of the equity of Litemax, MS Company has since withdrawn from Litemax, after the withdrawal of MS Company, Wright Optoelectronics to BOE, a major customer introduced through MS Company, will be affected, it is not known at present.

Not only in terms of technology, but also in customer development is also highly dependent on MS Lite Optoelectronics, whether it can face the market alone after parting ways with MS is also an important issue to consider in its operational independence.

Customers overlap with suppliers

The prospectus discloses that MS Company not only acts as a related party of Wright Optoelectronics, but also serves as a triple identity of the company's customers and suppliers.

From 2018 to 2020, MS Company was the largest, largest and third largest supplier of Lite Optoelectronics, and the purchase amount of Lite Optoelectronics from MS Company was 23.2638 million yuan, 15.134 million yuan and 6.6989 million yuan, respectively, and in 2018, MS Company was also the fourth largest customer of Lite Optoelectronics, and the company's sales revenue was 5.4215 million yuan.

Under normal circumstances, the company's customers and suppliers should be in the upstream and downstream of the industry, but if the two overlap, then these business cooperation objects may belong to the company's more significant transaction subjects, and there may be multiple risks behind them, including possible issues such as commercial rationality, operational independence, profit transmission and suspected avoidance of competition in the same industry. This has had a huge impact on the operational independence of Lite Optoelectronics, and whether Lite Optoelectronics will be stranded on the science and technology innovation board this time, yunchuang finance will remain concerned.