In this month, the communications industry has successively received information on the improvement of supply and demand imbalances of optical fiber and optical cables. Words such as “single orders are strong”, “orders are quite full”, and “supply is in short supply” are frequently used to describe the current status of manufacturers.
With regard to the booming economy, supply shortage, and full orders, A-share related companies told the Daily Economic News reporter that this year's downstream demand will be very satisfactory. Conservative estimates that the current situation of supply shortage can be maintained in the first half of this year. In terms of prices, after the decline in the previous two years, some manufacturers are brewing price increases; although it is still necessary to communicate with customers in the event of a successful achievement of the goal, it is generally expected that there will be little room for prices to go down.
Two years after the supply of optical fiber and cable was in short supply, the demand for products was in short supply, orders were dispatched to the second quarter of this year, and other news came out from the industry. The “spring” of the optical fiber and cable industry seemed to have arrived.
Fenghuo Communications stated that from the supply point of view, the company’s products in this area are indeed in short supply; from the price point of view, since the 2012 collection of telecom operators has not yet commenced, the products supplied to operators are still executed when the tenders were issued at the beginning of last year. Collecting price, but the price of the product outside the collection has risen, "because (the price is low) cannot be bought at all."
Ye Yonglian, a representative of Zhongtian Technology Securities, told the “Daily Economic News” reporter that the industry’s business climate is indeed very good this year. The company’s current orders are basically saturated, and production capacity is tight, and prices are currently stable.
Hengtong photoelectric evidence Wu Jianjun said that the disclosure of the company's annual report shall prevail. Earlier, the chief technology officer of Hengtong Group, Lei Jianshe said that the company is producing at full capacity. "As long as the fiber is produced, there will be no market."
At present, China's optical fiber cable market is in a "five major" pattern. Wuhan Changfei, Fortis Group, Fiberhome Communications, Hengtong Optoelectronics, and Zhongtian Technology occupy the majority of market share. According to data compiled by Huatai United Securities Researcher Kang Zhiyi, the market share of the above five manufacturers in 2006 was a total of 68%, and by 2010 it had increased to 82%; and the respective market shares of the five manufacturers, except Wuhan Changfei’s long-term Maintained at 20%, the remaining four are maintained at about 15%. In addition, Tongding Optoelectronics sources said that the company's demand for fiber optic cable products is now very good, "a production to sell it" is indeed "supply."
Strong downstream demand for the reasons for the recovery of light and cable, "Daily Economic News" reporter learned that, for Fiberhome, Hengtong Optoelectronics, Zhongtian Technology, the downstream demand has improved since the end of last year, FiberHome and Zhongtian Technology has expressed this view. Hengtong Optoelectronics annual report shows that in the second half of last year Hengtong photoelectric fiber optic cable and optical device business increased by 50% year-on-year.
It is reported that the "3.11" earthquake in Japan is one of the reasons for the improvement of the business of first-tier manufacturers of optical fiber cables. The earthquake and the subsequent implementation of power-restricting measures seriously affected the production and operation of the enterprises in the country. The original reliance on the prefabricated rods of major optical fiber and cable products imported from Shin-Etsu, Fujikura, and Sumitomo had become even tighter. In this context, the above-mentioned three listed companies were given priority in supply, and in addition, the prefabricated projects constructed since 2008 have also been put into operation successively to ensure a certain self-sufficiency ratio of the preforms.
This year, the strategy of "broadband China" put forward by telecom operators has entered a period of substantial construction. At the same time, the "two sessions" this year also put forward requirements for the integration of the three networks. In this regard, Fiberhome said that triple play, broadband speed increase means higher demand for bandwidth, in the face of huge data traffic, the existing ADSL network using electrical signal transmission is poor, requiring the use of optical signals, transmission More capacity, better quality, more convenient expansion of optical fiber transmission.
Industry players expect that fiber optic cable demand this year will come mainly from two aspects: the traditional broadband upgrade and triple play advancement. The current copper core ADSL network bandwidth can only be upgraded to 8M, 10M and above can only be replaced with optical fiber. In addition, some manufacturers expect that China Mobile will obtain broadband licenses and enter the broadband access market on a large scale. However, there is no clear timetable for the matter.
Manufacturers jointly brewing price increase It is reported that manufacturers are more optimistic about the expectations of the market for the whole year. Lei Jian believes that this wave of the market "sustainable for two years"; Ye Yong Lian said that from the company's existing orders, the situation in short supply in the first half of this year continued to maintain no problem.
"Overall, this year's supply and demand will tend to balance, but in the short term there will be a tight supply situation." Tian Bosheng, a researcher at China Investment Advisor's optoelectronics industry, said that demand for fiber optics will increase this year. It is expected that demand for fiber will be higher than 2011. Annual growth of 10% to 15%. Although the overall trend is to balance supply and demand, due to the seasonal demand, the supply is in short supply.
For A-share companies, there are prices in addition to sales that can actually boost performance growth. After two years of continuous decline in China's optical fiber prices after two years, the average price per year in the price per kilometer is still more than 80 operators to set the price, a sharp decline in 2010, 16% in 2011 continued to decline by about 3%, fell to 68 yuan / Core km or so. Xiang Cai Securities researcher Zhou Mingyu said that the price is related to the manufacturer's gross profit rate, which directly affects the profitability level; if the price continues to decline, even if the supply and demand reversal does not make much sense to the listed company's performance.
It is understood that as the rotating chairman of the Communications Industry Association Cable and Cable Professional Committee this year, Zhongtian Technology is actively associating with major manufacturers to increase their prices. On March 23, Ye Yonglian told the reporter of the “Daily Economic News” that companies certainly hoped that prices could go up, but the final result had to negotiate with customers.
At the same time, for the operator's price collection, Fiberhome said that this year's merger and acquisition has not yet officially started, but under the background of increasing demand, there has been little likelihood of a price war in the past.
“The price was low for the first two years, mainly due to the oversupply. The current market demand has rebounded to a certain extent, which will promote the balance between supply and demand, and will also increase the price to a certain extent.” Tian Bosheng said that this will Improve the company's gross margin level.
