1. **Industry Technology Overview**
The touch screen (Touch Panel, TP), also known as a “touchscreen” or “touch panel,” is an information input device that utilizes touch sensor technology for human-machine interaction. Based on different working principles, touch screens can be categorized into resistive, capacitive, optical, ultrasonic, and electromagnetic induction types. Among these, capacitive touch screens, known for their high sensitivity, good transparency, strong stability, long lifespan, and support for multi-touch, are the mainstream technology widely applied in smart consumer electronics, industrial medical equipment, smart homes, office equipment, and automotive electronics. Capacitive touch screens can be further classified into external and embedded types.
External capacitive screens have a basic structure where the touch panel is separate from the LCD panel, employing film-based (GFF and derivatives) and glass-based (GG and OGS) solutions. External solutions offer advantages such as simple processes, mature technology, and low costs.
Embedded capacitive screens integrate the touch panel and LCD panel, primarily using In-Cell and On-Cell technologies. Although embedded screens are characterized by slimness and high transparency, their production involves higher costs due to the integration of thin-film transistor array circuits, requiring the development of mask and process technologies. Consequently, embedded capacitive screens are mainly applied in the smartphone market.
2. **Upstream and Downstream Industry Chain Situation**
The touch screen industry encompasses a lengthy and technology-intensive supply chain. Upstream involves the production of raw materials, including ITO films, cover glass, chips, flexible circuit boards, optical adhesives, and other electronic components. Notable manufacturers include TPK, Nippon Electric Glass, O-film, Asahi Glass, Goodix, Biel Crystal, and Truly Semiconductors. With China’s enhanced R&D capabilities, some materials like ITO films and chips are gradually transitioning to domestic production, improving the touch screen industry’s raw material supply system.
The midstream focuses on the development, production, packaging, and sales of touch sensors, modules, and touch display modules. As society becomes more intelligent and interconnected, the touch industry experiences rapid development, penetrating various fields. Competition is fierce, with prominent players like O-film and Holitech dominating the small-sized touch product segment. In emerging areas like automotive electronics, industrial control, office equipment, and smart homes, early entrants such as Truly, Goodix, and Silead have established a strong presence.
Downstream involves touch display terminals, spanning consumer electronics like smartphones, tablets, laptops, smartwatches, and professional display terminals in smart homes, industrial control, medical equipment, office equipment, and automotive electronics. Due to the customized nature of touch products, downstream customers rigorously assess touch screen suppliers before establishing stable cooperation.
3. **Major Companies in the Industry**
**Global Major Companies**
A. **Japan Display Inc. (Stock Code: 7915.TSE)**
Japan Display, founded in 1929, is headquartered in Kyoto, Japan. It specializes in the production of IMD films and touch sensors. Its products are widely used in smartphones, tablets, handheld game consoles, industrial terminals, automobiles, and transportation equipment.
B. **Nissha (Stock Code: 7241.TSE)**
Nissha, established in 1948, is based in Okazaki, Japan. It engages in the design, development, manufacturing, and sales of various electronic components, electronic devices, and production equipment. Its products include fluorescent display tubes, displays, touch sensors, robot functional components, and molding peripherals.
**Domestic Major Companies**
A. **GIS Touch**
Yecheng Holdings, founded in January 2011 in Taiwan, is listed on the Taiwan Stock Exchange since 2015. It specializes in the production and sale of touch module products, providing comprehensive touch display technology solutions.(https://www.gis-touch.com/)
B. **TPK Holding Co., Ltd**
EELY-ECW Technology, established in May 2003 in Taiwan and listed on the Taiwan Stock Exchange in 2010, focuses on the research, development, production, and sales of touch sensors, touch modules, touch screens, ITO glass, and protective glass.(https://en.tpk.com/)
C. **Wuhu Changxin Technology Co., Ltd**
Changxin Technology, founded in April 2000, went public on the Shenzhen Stock Exchange’s Growth Enterprise Market in May 2010. Its business involves automotive electronics, ultra-thin LCD panels, consumer electronics, and ITO conductive glass.(http://www.tokengroup.com/)
D. **Silead Electronics**
Silead Electronics, established in July 1997 and listed on the Shenzhen Stock Exchange’s main board in October 1997, is primarily engaged in the research, production, and sales of printed circuit boards, LCDs, touch screens, ultra-thin and special copper-clad boards, and ultrasonic electronic instruments.
E. **Shenzhen AV-Display Co., Ltd (AVD, Stock Code: 300939) **
Qikang Micro, founded in November 2004 and listed on the Shenzhen Stock Exchange’s Growth Enterprise Market in January 2021, is mainly involved in the research, design, production, and sales of LCDs and touch products, including monochrome LCDs, monochrome LCD modules, color LCD modules, and capacitive touch screens. (https://www.av-display.com/)
4. **Opportunities for Industry Development**
(1) **Industry Policy Support:**
In recent years, the touch screen industry, as part of the sensitive components and sensor manufacturing sector, has received robust support from various government policies. Policies such as the “Guidance Catalog for Key Products and Services in Strategic Emerging Industries (2016 Edition)” and the “Catalog of Encouraged Foreign Investment Industries (2020 Edition)” explicitly promote key technology research and development, industrialization of flexible displays, and encourage foreign investment in industries such as new electronic components and touch component manufacturing.
The support of industrial policies is a prerequisite for the survival and development of enterprises in the industry. As various policies are rolled out, the touch screen industry is expected to experience sustained growth in market size.
(2) **Continued Expansion of Downstream Application Areas:**
With the increasing penetration of human-machine interaction application scenarios, there has been a significant shift in people’s production and lifestyle, demanding higher convenience, automation, and intelligence from products. Human-machine interaction technology, besides traditional applications like computers and smartphones, is expanding rapidly into various fields such as smart cars, office equipment, industrial automation, smart homes, new retail, wearable devices, and medical equipment. As a crucial product for realizing human-machine interaction information input and output, the touch module market is experiencing substantial demand, especially with the rapid advancement of artificial intelligence technology.
(3) **Global Touch Industry Capacity Transfer:**
The touch screen industry, with its long supply chain, requires substantial capital, labor, and technological input. Currently, the touch industry is mainly concentrated in the Asia-Pacific region, including Japan, Korea, Taiwan, and mainland China. Compared to Japan and Taiwan, the mainland has a labor cost advantage. As China’s electronic information industry develops, and the downstream terminal market demand expands, the advantageous position of mainland touch screen manufacturers is becoming more evident. In the past two years, due to effective pandemic control domestically, the transfer of touch industry capacity to the mainland has accelerated, providing a favorable environment for domestic touch industry enterprises.
5. **Challenges for Industry Development**
(1) **Global Chip Supply Shortages:**
Global semiconductor chip production is primarily concentrated in Southeast Asia. The widespread application of semiconductor chips, driven by the new technological revolution, has led to increased demand. The diffusion of the COVID-19 pandemic has resulted in a surge in demand for terminal application products supporting remote work and home-based lifestyles. However, due to multiple factors such as escalating global trade frictions since 2018 and unavoidable events like the pandemic causing factory shutdowns, the chip supply chain has been disrupted. The resonance of increased demand and reduced supply has led to a shortage of chips in downstream application areas. External market risks pose a systemic risk with sustained impacts on all enterprises in the industry.
(2) **Immaturity of Domestic Upstream Material Companies:**
As the touch screen industry’s capacity gradually shifts from Japan, Korea, and Taiwan to the mainland, the localization of upstream materials is accelerating. The electronic industry, including the touch display industry, mainly relies on customized products. However, the upstream value-added, technologically advanced raw materials have long been monopolized by foreign companies. Domestic upstream material enterprises started late in development, and there is still a certain gap in terms of technology accumulation, product competitiveness, brand recognition, etc., compared to foreign enterprises. A significant portion of critical raw materials still relies on imports, imposing constraints on the rapid development of the touch screen industry in China.
From <Special report on market segment analysis and investment prospects of the touch screen industry from 2022 to 2028>
