[Edaily Reporter Kim So-yeon] China’s rise in the memory chip sector is accelerating. This comes as Changxin Memory (CXMT) is pushing ahead with a massive initial public offering (IPO) to raise approximately 6.7 trillion won. Many analysts suggest that if CXMT uses this large-scale capital raise as a springboard to expand its production capacity, it could put pressure on the standard memory businesses of Samsung Electronics and SK Hynix. There are also concerns about a “chicken game” resulting from a flood of legacy memory supply.

According to industry sources on the 16th, the China Securities Regulatory Commission (CSRC) completed CXMT’s listing application procedures on the Science and Technology Innovation Board (STAR Market)—often referred to as China’s version of the Nasdaq—on the 12th. Following a book-building process, the company is expected to officially debut on the stock market by the end of this month or, at the latest, sometime next month. CXMT’s public offering size has been finalized at 29.5 billion yuan (approximately 6.7 trillion won). This marks the second-largest IPO in the history of the STAR Market, following the listing of Chinese foundry company SMIC. The company’s post-listing market capitalization is estimated to range from 440 trillion to 660 trillion won.

Having secured more than 6 trillion won in funding, CXMT is highly likely to embark on aggressive investment. The company is expected to accelerate its expansion of market share in the general-purpose memory market by increasing capital expenditures to expand production capacity. The volume offensive by Chinese memory manufacturers is expected to gain momentum.

In fact, CXMT is strengthening its presence in the general-purpose DRAM market. According to Counterpoint Research, CXMT’s global DRAM market share rose to 8% as of the first quarter of this year. It has climbed into the top four, trailing only Samsung Electronics, SK Hynix, and Micron, and is accelerating its pursuit of these leaders.

Notably, CXMT is no longer a chronically unprofitable company. According to its IPO filing documents, revenue for the first quarter of this year reached 50.8 billion yuan (approximately 11.3 trillion won), a 719% increase year-over-year. During the same period, operating profit stood at 35.4 billion yuan (approximately 8.4 trillion won), marking a successful turnaround from the 2.8 billion yuan loss recorded in the first quarter of last year.

Following its successful mass production of DDR5 and low-power memory types such as LPDDR5 and LPDDR5X, CXMT is rapidly improving its profitability, further boosted by recent increases in memory prices. This has raised concerns that if CXMT leverages its production capacity to expand its market share in the general-purpose memory sector, it could impact the profit base of Samsung Electronics and SK Hynix in this market.

In a report titled “Diagnosis of the Current Situation in Key Sectors of ‘Made in China 2025’ and Our Response,” Jo Eun-kyo, a research fellow at the Korea Institute for Industrial Economics & Trade, analyzed that the Chinese semiconductor industry has shifted its strategy: while leaving advanced semiconductor production as a long-term challenge, it is focusing in the short term on building a self-contained ecosystem centered on legacy semiconductors and achieving technological self-reliance. This is a result of U.S. semiconductor sanctions against China.

Research Fellow Cho noted, “If China supplies legacy semiconductors to the global market by leveraging its price competitiveness, it will be difficult for other companies to secure a competitive edge,” adding, “China’s low-cost production capacity is highly likely to become a key strategic lever in the future.”

Along with CXMT, Yangtze Memory Technology (YMTC), China’s largest NAND flash manufacturer, is also in the process of an IPO. With China’s two major memory companies successively embarking on large-scale fundraising, observers say the strategy for self-reliance across the entire Chinese semiconductor industry has entered a new phase.

An industry official stated, “China’s low-price offensive strategy, as seen in the display and battery markets, could also emerge in the semiconductor sector,” adding, “The top priority for domestic companies is to secure cutting-edge technologies with a significant lead in advanced fields such as artificial intelligence (AI) memory.” However, some analysts suggest that given the still-significant technology gap, the differentiated competitiveness of domestic companies in AI memory could actually be highlighted.