China's CXMT surges nearly 500% in explosive Shanghai stock market debut

[Shawn Knight]

What just happened? Chinese memory maker CXMT is now the country's most valuable company after an impressive first day on the market that exceeded expectations. The stock's initial public offering price was set at CNY 8.66 but ended up closing at CNY 49.00 – a gain of nearly 466%.

CXMT, short for ChangXin Memory Technologies, is one of several major players in the memory market that are profiting from the ongoing AI boom. At present, CXMT ranks fourth overall with an eight percent share behind Samsung, SK Hynix, and Micron with shares of 36%, 29%, and 24%, respectively.

Larry Yang, chief economist of First Seafront Fund Management, told AFP that CXMT's first-day performance reflects investors' overwhelmingly bullish sentiment regarding the company.

The memory maker closed the successful day of trading with a market cap of around 3.65 trillion yuan, or roughly $540 billion. Fortune said it was mainland China's second largest IPO ever, following that of Agricultural Bank of China back in 2010.

Yang added that the newly raised money will give CXMT the ability to expand production capacity, in addition to boosting its global influence. Being able to tap a homegrown hardware maker should also benefit China in its AI race against the US.

CXMT was founded in 2016, just in time to leverage the pandemic-fueled PC buying surge. Then came the AI boom and as you can imagine, hardware makers and investors have been singing all the way to the bank. Consumers, meanwhile, have been met with soaring prices on smartphones, game consoles, and virtually everything else that relies on a memory chip to operate.

Worse yet, there appears to be no relief in sight. Earlier this month, SK Hynix said it expects the memory crunch to peak in 2027 and continue through at least 2030.

According to AFP, Apple is now testing DRAM chips from CXMT for use in future products. Signing on as a supplier for the Cupertino-based company is no doubt high on CXMT's list of short-term goals.

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China's CXMT surges nearly 500% in explosive Shanghai stock market debut

 

[Lounds]

If I were the other memory manufacturers I'd be worried. I could see CMXT gaining the majority of the consumer and enterprise markets in a few short years.

 

[Theinsanegamer]

If I were the other memory manufacturers I'd be worried. I could see CMXT gaining the majority of the consumer and enterprise markets in a few short years.

At the rate they're building they'll control half of it by the end of the decade.

 

[NumberNine]

Their greed was China's advantage.
I can't wait to see the exact language on the incoming ban.

 

[maxxcool7421]

Their greed was China's advantage.
I can't wait to see the exact language on the incoming ban.

Sounds like I need a mailbox in mexico or canada..

 

[p51d007]

Memory prices out of control, push back against AI Data centers...gee it's almost as if China
is trying to corner the market again.

 

[BuckarooBonzaii]

Looks like China may dominate the market like how they did in manufacturing.

 

[BobHome]

Looks like China may dominate the market like how they did in manufacturing.

Well, they do tend to play the l-o-n-g game, not the G.R.E.E.D. game.
(I remember as a computer tech being asked to write my 1, 5, 10 year goals... does that even happen, anymore?)

 

[Endymio]

Their greed was China's advantage.

If you'd paid attention in econ class, you'd understand that when demand increases much faster than supply, either prices must rise or the shelves run bare. Which would you prefer: being able to purchase pricey RAM, or not being able to buy it at all-- except perhaps from scalpers?

As for anyone who laughingly believes a China-dominated memory market is "good for the consumer", I suggest you check out their behavior in other markets for which they've driven out the competition, such as the supply of rare earth elements.