Cxmt Corporation (688825.SH) has achieved a historic milestone by becoming the largest company by market capitalization on the A-share market on its first trading day. This event validates the capitalization pathway for China's hard-tech enterprises.
On the industrial front, Cxmt Corporation has broken the monopoly held by three international giants. Looking ahead, the company is expected to leverage its IPO capital to achieve technological breakthroughs and ramp up production capacity, ultimately reshaping the global competitive landscape.
In July 2026, the A-share market witnessed a landmark event with the listing of domestic memory chip leader Cxmt Corporation. On its first day, the company's market cap surpassed 3 trillion yuan, making it the most valuable stock on the A-share market. In the following days, its intraday market cap briefly touched the 4 trillion yuan mark, closely trailing Tencent Holdings, China's most valuable company.
The day before its listing, Cxmt Corporation held a shareholder appreciation gala at a five-star hotel on the Bund in Shanghai, with over 300 guests in attendance. In stark contrast to this lively scene, the company's headquarters remained exceptionally quiet. On the afternoon of July 28, a visit to the base of Cxmt Corporation in Beijing's Economic-Technological Development Area found the facility calm and peaceful under the hot sun. The company's three wafer fabs are operated by three subsidiaries, with the Beijing base being one of them.
As China's largest and most technologically advanced integrated DRAM design and manufacturing company, the listing of Cxmt Corporation is of great significance. It marks the completion of a core piece of the semiconductor manufacturing puzzle for the A-share market, an event whose importance extends far beyond a single company's IPO. It has redefined semiconductor valuation logic and validated the capital market pathway for China's hard-tech firms.
A partner at Ningbo Yanchuang, which participated in Cxmt Corporation's Series B funding round, noted that the listing marks a breakthrough for domestic memory chips from zero to one. In an oligopolistic landscape where three international giants control 90% of the global market, the company's scaled commercial use will reshape the industry chain, boosting upstream equipment and materials, as well as downstream packaging, testing, and modules. This will help China gain a voice in the AI memory sector.
Due to overwhelming market demand, the IPO fundraising amount for Cxmt Corporation was raised from 29.5 billion yuan to 57.919 billion yuan, making it the largest IPO on the STAR Market since its inception in 2019. This investor enthusiasm is driven by an unexpectedly strong memory industry cycle. Since the second half of 2025, the explosive growth in AI computing demand has led to a significant surge in memory chip prices.
The current memory shortage stems from a combination of factors: restrained capacity expansion by overseas manufacturers during 2023-2024 and an unexpected surge in AI demand, with supply lagging behind. This supply-demand imbalance is not expected to ease until the second quarter of 2028. This cycle is more complex than past ones, driven by structural demand from AI infrastructure and a reallocation of capacity by top-tier global players towards high-end products like HBM, which has objectively reduced the supply of mature DRAM products.
Driven by the high industry cycle, Cxmt Corporation, whose main revenue comes from mature products like DDR and LPDDR, brought forward its profitability to 2025. In the first half of 2026, the company expects to achieve a net profit attributable to shareholders of between 50 billion and 57 billion yuan, a year-on-year increase of 22 to 25 times. Despite this, the company still lags behind international leaders like Samsung Electronics, SK Hynix, and Micron Technology in terms of revenue, market share, and product diversity.
Notably, products from Chinese memory companies are beginning to enter the view of major international customers, signaling an acceleration of domestic memory into the global supply chain. International tech giants like Apple and Google are reportedly intensifying their efforts to onboard domestic memory chips. While the direct sales ratio to overseas customers remains low, there are positive signs, with some top-tier international clients initiating product testing. This recognition from major international customers confirms the competitiveness of Chinese products.
CITIC Securities suggests that in the context of a global DRAM supply shortage and a desire for supply chain diversification among overseas clients, Cxmt Corporation's DDR and LPDDR products are likely to accelerate their overseas certification and gradually expand globally.
Setting Multiple IPO Records
On July 27, Cxmt Corporation officially began trading on the STAR Market of the Shanghai Stock Exchange. Its opening price was 49.5 yuan per share, a 471.59% increase from its issue price, propelling its total market capitalization directly to over 3 trillion yuan and surpassing Industrial and Commercial Bank of China to become the most valuable company on the A-share market. Within just one hour of trading on the first day, its turnover exceeded 100 billion yuan. The company's trading volume on its debut day was 141.187 billion yuan, with a closing market cap of 3.28 trillion yuan.
The listing of Cxmt Corporation set numerous historical records: the largest IPO on the STAR Market, the largest IPO by fundraising amount in the A-share market in the last decade, and the largest tech IPO in the history of the A-share market. On its first day, it also became the first stock to achieve a daily turnover exceeding 100 billion yuan, the first tech stock to open with a market cap exceeding 3 trillion yuan, and the first new stock to have a turnover rate exceeding 60%. In subsequent trading days, its share price continued to fluctuate upwards, with its intraday market cap briefly surpassing the 4 trillion yuan mark on July 31.
During the IPO issuance phase, due to high investor enthusiasm, the company's total fundraising amount increased from 295 billion yuan to 57.919 billion yuan. If the over-allotment option is fully exercised, the total fundraising could further increase to 66.607 billion yuan, potentially making it the third-largest IPO in A-share history. The issuance saw competition from 285 institutional investors and 9.4288 million retail investors. A total of 30 strategic investors, including state-backed funds, insurance funds, and industrial capital, participated in the strategic placement, with lock-up periods ranging from 12 to 36 months. State-backed funds, including the National Social Security Fund, subscribed for 7.6 billion yuan, accounting for over half of the strategic placement total.
The strategic placement for Cxmt Corporation brought together national funds, insurance capital, industrial investors, and the company's management and core employees, reflecting the capital market's strong interest in and recognition of the integrated circuit industry's development and the company's long-term value. Leveraging the "tech bull" market in capital markets and its own hard strength in the memory chip sector, Cxmt Corporation's IPO process was swift, taking only 148 days from acceptance to approval.
In October 2025, the company completed its tutoring and was qualified to submit its IPO application. On December 30, 2025, the Shanghai Stock Exchange formally accepted the application, making it the first pilot enterprise under the pre-review system for the STAR Market proposed by the China Securities Regulatory Commission in June 2025. The company had completed two rounds of inquiries before its application, significantly shortening the review cycle. This pre-review system helps strategic tech companies like Cxmt Corporation protect their core technology and business information while also improving review efficiency, enabling them to accelerate technology innovation and seize market opportunities.
Founded in June 2016, Cxmt Corporation completed nine rounds of pre-IPO financing over eight years, raising a total of tens of billions of yuan. The company's listing coincided with a period where the global memory chip industry cycle, its performance cycle, and the capital cycle were all aligned. As China's largest and the world's fourth-largest DRAM manufacturer, its listing dynamics have been a focal point for the capital market. An investor involved in the company's Series A round in 2020 described the listing as a milestone for the domestic memory chip industry, truly filling the gap in the domestic memory sector and completely solving the blank space for high-end domestic DRAM memory chips.
An institutional investor noted that Cxmt Corporation and YMTC are the two pillars of China's self-controlled memory chip industry. Memory is a capital-intensive, high-investment track requiring continuous, massive funding for R&D and capacity expansion. The current AI-driven memory super-cycle, with high industry sentiment coinciding with the performance of these two industry leaders, represents the perfect window for listing, allowing them to use capital to strengthen their competitive positions. The company's chairman stated that entering the capital market is a new beginning and a new responsibility, aiming to further enhance its technology R&D capabilities and industrialization level through the funds raised.
A finance professor at CKGSB highlighted that the listing is a milestone event for the capital market's service to hard tech under the registration system, emphasizing the STAR Market's role in supporting technology and strengthening capital support for tech innovation. It proves that the A-share market's registration system is now capable of accommodating the financing needs of mega-cap tech companies, establishing the capital market as a core funding channel for technological self-reliance and solidifying the STAR Market's "hard tech" label.
AI Drives an Explosion in Performance
Benefiting from the AI-induced memory super-cycle, Cxmt Corporation brought its profitability timeline forward to 2025. However, the company still has a weakness in its relatively low revenue contribution from the server segment, which is not yet aligned with the global market where server DRAM accounts for 50% of total demand. The company was in a loss position for an extended period. From 2022 to 2024, while its revenue grew from 8.3 billion yuan to 24.2 billion yuan, its net losses attributable to shareholders were all over 7.1 billion yuan. The company was still in the red in the first half of 2025.
The primary reasons for the company's previous sustained losses were the scale-oriented nature of the DRAM industry and its extremely high technical barriers. The depreciation of fixed assets from capacity expansion, combined with continuous high R&D investment, were major cost drivers. From 2022 to the first half of 2025, the company's R&D expense ratio was 30%, 50%, 19%, and 24% respectively, significantly higher than its competitors Samsung Electronics, SK Hynix, and Micron Technology in the same periods. Since the second half of 2025, with the sharp rise in DRAM prices, the company's performance entered a breakout phase, achieving profitability that year, ahead of its earlier forecast of 2026 or 2027.
For the first half of 2026, Cxmt Corporation expects revenue of 110 billion to 120 billion yuan, a year-on-year increase of 6.12 to 6.77 times, and a net profit attributable to shareholders of 50 billion to 57 billion yuan, a 22 to 25-fold increase. At this first-half 2026 profit level, the company would rank tenth among A-share listed companies in the profitability rankings for the 2025 semi-annual report, trailing only state-owned banks and other large firms. This rapid turnaround to profitability is driven by the global shortage of DRAM products and the significant price increases since the second half of 2025, fueled by the sustained growth in global computing demand and capacity adjustments by major manufacturers.
The company's revenue mainly comes from its DDR and LPDDR series, which together accounted for over 90% of total revenue in 2025. The higher proportion of LPDDR sales is due to their use in smartphones and tablets, where the company has rapidly expanded its downstream customer base, leading to robust and fast-growing demand. The main factor behind the company's revenue growth is the simultaneous increase in product prices and sales volume. In 2025, the unit price and sales volume of its DDR series increased by over 60% and over 2.8 times year-on-year, respectively, while its LPDDR series saw growth of over 20% and over 60%, respectively. The company's product mix is also continuously improving, with high-priced products like DDR5 and LPDDR5X ramping up quickly.
The demand for memory chips continues to grow due to the AI boom. A banking professional noted that the number of AI companies in China is already in the hundreds and is still growing, indicating a massive future demand for the memory industry, which is likely to grow geometrically rather than linearly. However, the company still has significant room for optimization in its downstream revenue structure. Mobile devices remain the primary revenue source for Cxmt Corporation, and while its revenue from the AI server segment has been growing rapidly, it remains low. From 2023 to 2025, revenue from mobile devices accounted for over 60% of the company's total revenue, while the server segment's share grew from 4.6% to 27%. In contrast, the global DRAM market in 2025 saw server demand account for 50%.
A partner at Puzhuo Capital attributed the low revenue share from AI server DRAM to a combination of factors, including product certification, advanced process technology, capacity allocation, and customer barriers. These include the stringent and lengthy certification processes required by cloud and server manufacturers, the company's current priority on mobile LPDDR where yields are more stable, the fact that server-grade storage is still in R&D and small-scale validation, a gap in overall solution capabilities compared to overseas leaders, and the long-term partnerships between top cloud providers and overseas suppliers.
Despite its performance growth, Cxmt Corporation faces risks related to large fixed asset investments and depreciation, as well as inventory write-downs. From 2023 to 2025, the company's fixed asset depreciation charges were 10.6 billion yuan, 14.9 billion yuan, and 24.7 billion yuan, respectively, and are expected to increase further as it continues to expand capacity. Inventory write-downs were 11.5 billion yuan, 1.8 billion yuan, and 0.5 billion yuan in the same periods. The large write-down in 2023 was due to the cyclical downturn in the DRAM industry. The company cautioned that if the macroeconomic environment, AI demand, or market supply-demand dynamics change adversely, the DRAM industry could enter another downturn, leading to a sharp decline in product prices and significant fluctuations in performance, warning that the high growth in the first half of 2026 may not be sustainable.
Significant International Gap Remains
Compared to top international memory companies, Cxmt Corporation still lags in revenue, market share, and product breadth, although some gaps are closing. In terms of revenue, in the first quarter of 2026, Samsung Electronics and SK Hynix generated 11.98 times and 4.71 times the revenue of Cxmt Corporation, respectively. The company has not yet generated clear revenue from HBM products, a segment where international giants are actively competing for market share. According to Omdia data, based on sales, Samsung Electronics, SK Hynix, and Micron Technology controlled over 90% of the global DRAM market in 2025. Cxmt Corporation's global market share grew from 3.97% in the second quarter of 2025 to 7.67% in the fourth quarter, and reached 8% in the first quarter of 2026, according to Counterpoint Research.
The company's product portfolio is narrower compared to the top three global DRAM manufacturers. It currently focuses on DDR and LPDDR products, while its competitors have a broader range including GDDR and HBM. The company has not yet made a clear strategic move into HBM products, although its main products like DDR5 and LPDDR5/5X are comparable to those of its competitors. HBM products, with their advantages of high bandwidth and low latency, are widely used in AI chips, high-performance computing, and supercomputing centers, and are becoming a mainstream direction for future development, a market dominated by Samsung, SK Hynix, and Micron.
In terms of process technology, Cxmt Corporation is two to three generations behind foreign manufacturers, according to TechInsights. However, it is rapidly catching up with overseas leaders through "skip-generation" R&D, with some technologies in its fourth-generation process platform reaching international advanced levels. The company has also made forward-looking investments in 4F2+CBA technology for DRAM wafer architecture, which could accelerate its progress in equivalent process technology. The company acknowledges that its production capacity still lags behind the top three global DRAM manufacturers, who have dominated the market since the 1980s through long-term capacity expansion and consolidation. Cxmt Corporation is still in a phase of large-scale capacity construction and ramp-up.
From its IPO proceeds, 7.5 billion yuan will be used for technology upgrades to its memory wafer manufacturing lines, and 13 billion yuan for DRAM memory technology upgrades, totaling 20.5 billion yuan directly invested in production lines and process upgrades. The total equipment purchase and installation costs for these two projects are 22.1 billion yuan, accounting for 64% of the total investment. CITIC Securities estimates that this investment could add about 20,000 to 30,000 wafers per month of equivalent capacity. With further equipment filling, process switching, and yield improvement at its Hefei and Beijing facilities, the company's monthly capacity is expected to rise to over 300,000 wafers by 2026. A Goldman Sachs internal meeting held three days before the listing predicted that by 2030, the company's annual capacity could more than double from current levels.
Some institutions point out that while Cxmt Corporation is China's memory leader, akin to SK Hynix, and SMIC is the country's chip manufacturing leader, akin to TSMC, both are constrained by "bottleneck" equipment like high-end EUV lithography machines. They rely on multiple patterning techniques using DUV lithography for mature nodes, and the gap with global leaders remains significant. A banking professional noted that the main gap is due to a late start, and with enough time, all other limitations except for lithography machines can be closed. The gaps are also rooted in multiple industry barriers, including a capital accumulation gap, constrained upstream equipment and materials, insufficient underlying process and patent accumulation, a weak layout in high-value-added products like HBM, and limited global operational capabilities.
Despite these gaps, Cxmt Corporation and other leading Chinese memory companies are beginning to show their domestic advantages. After years of development, the company has developed the ability to rapidly iterate products and technologies, manage large-scale production and operations, and respond efficiently to customers. It has built a strong industrial ecosystem based on the vast domestic market and its upstream and downstream partners, creating a solid competitive advantage. Yole data shows that the Chinese DRAM market was about 25 billion U.S. dollars in 2024, accounting for over a quarter of the global market, making it a major global DRAM consumer. The country has long been heavily reliant on imports in this area, providing ample room for growth for domestic manufacturers.
A partner at Ningbo Yanchuang summarized the objective reasons for the gap between domestic memory and international leaders: DRAM is a capital-intensive track where top players like Samsung have built massive scale effects through decades of investment, significantly lowering costs. International giants also hold a large number of underlying patents, building a competitive moat that latecomers must navigate around. Furthermore, overseas manufacturers have long served global customers, accumulating extensive validation across multiple scenarios, while domestic companies still need time for certification in high-end scenarios like server storage. These factors, combined with U.S. supply chain controls, raise development costs.
The company's comprehensive gross margin has become competitive with the top three global players. In 2025, benefiting from economies of scale, a better product mix, and a sharp rise in DRAM prices, the company's comprehensive gross margin rose to 40.99%. In the same period, Samsung Electronics and Micron Technology had gross margins below 40%, while SK Hynix's was 60.41%. CITIC Securities predicts that the company's comprehensive gross margin will rise to 81.6% in 2026, before falling back to 76.9% and 72% in 2027 and 2028 as price increases normalize and depreciation increases, but still significantly higher than the 2025 level.
Future Valuation and the Cycle
A key question following the listing is whether this company, with a market cap exceeding 3 trillion yuan, will become the next PetroChina, and what its fair value is. The outlook for the memory industry's cycle is also a point of debate. A professor from CKGSB argued that comparing Cxmt Corporation to PetroChina's "peak on listing day" is a knee-jerk reaction based on memory of a "large IPO + cyclical industry" scenario. He emphasized that the two companies differ fundamentally in industry attributes, growth logic, and market environment. PetroChina was a mature traditional cyclical company with slowing growth, while Cxmt Corporation is in a growth phase with strong domestic substitution potential, having just started its capacity expansion and technology catch-up journey.
Since its listing, the company's share price has been relatively stable, closing at 53.97 yuan per share on July 31, with a market cap of 3.61 trillion yuan. Valuations from various institutions show a wide divergence, ranging from 2 trillion to 5 trillion yuan. Nomura Securities gave a target price of 116 yuan per share, based on a 20x P/E on its 2028 EPS forecast of 5.8 yuan, which is twice the valuation of Micron Technology, considering the company's market share growth and valuation premium in China. This implies a future valuation of 7.76 trillion yuan. Nomura believes that strong AI agent demand will drive global memory usage to grow more than seven times from 2026 to 2030, and that the company's global DRAM market share could rise to about 18% by the end of 2028.
Morgan Stanley, in a report just before the IPO, wrote that "Chinese semiconductor bulls expect Cxmt's market cap to reach multiples of its IPO market cap." Domestic brokerages also have varying estimates. Northeast Securities estimates a reasonable market cap range of 3.2 trillion to 5.7 trillion yuan. Most market institutions have a neutral expectation of 2 trillion to 3 trillion yuan. CITIC Securities predicts net profits attributable to shareholders of 152.215 billion yuan, 205.474 billion yuan, and 228.223 billion yuan for 2026-2028. The large valuation divergence is attributed to differing views on the company's long-term global market share and the speed of its HBM technology breakthrough.
Nomura noted in its report that the MATCH Act and potential sanctions are major downside risks, requiring close monitoring of the supply chain localization process. The company's current equipment localization rate is about 40%. In a worst-case scenario where its capacity expansion in Shanghai is delayed, this would have a significant negative impact on its revenue and net profit. CITIC Securities also identified trade frictions leading to supply constraints for equipment, parts, and materials as a key risk, along with risks from DRAM price and cyclical fluctuations, AI demand falling short of expectations, and intensified global competition.
Regarding the outlook for the memory cycle, there is a consensus that the current boom is strong, but opinions differ on its duration. Optimists see it extending to 2028, while more cautious voices suggest it may peak in 2027. Nicholas Gaudois from UBS stated that some cloud providers are confirming and increasing their AI capital expenditure, which is a key driver for the memory and AI chip uptrend. UBS expects the DRAM ASP to rise by 22% quarter-on-quarter in the third quarter of 2026 and another 12% in the fourth quarter. They are bullish on the cycle extending to 2028, citing the real consumption of memory by AI, the shift from training to inference, long-term agreements smoothing cycle volatility, and attractive valuations of top international companies.
Micron Technology has clearly stated that the tightness in DRAM and NAND could persist beyond 2027. A researcher from the Guojin Electronic Team believes the upcycle will continue through 2027, driven by persistent supply shortages. While the current price increase in traditional DRAM for consumer markets like PCs and phones may be slowing, the overall supply-demand gap is expected to support further growth in memory prices and scale. The turning point of the cycle will be signaled by a slowdown in the pace of price increases.
Many institutions believe that the current practice of top memory companies signing long-term agreements with downstream customers is helping to smooth the impact of the memory cycle. This trend is more pronounced among overseas companies, allowing them to lock in favorable long-term prices, potentially making future industry downturns much shallower than historical cycles.
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