[Edaily Reporter SOYEON KIM ] If Changxin Memory (CXMT) significantly expands its production capacity (CAPA), the first thing to be affected will be the price of general-purpose DRAM. Concerns are mounting that if CXMT launches a low-price offensive based on this large-scale expansion, it could deal a direct blow to the profitability of SamsungElectronics and SK hynix. This is why the domestic memory industry is most wary of CXMT.

CXMT plans to focus the 66.6 billion yuan (approximately 14.7 trillion won) raised through its initial public offering (IPO) on expanding DRAM production capacity, next-generation DRAM research and development (R&D), and upgrading production facilities. It will also invest in DDR5 and LPDDR5X processes, the development of 12-layer stacked High Bandwidth Memory (HBM) 3, and the construction of new production facilities. The company aims to expand its wafer production capacity—currently at 320,000 wafers per month—to 420,000 wafers by 2027.

The company will build new fabs in Shanghai and Beijing and establish a production cluster centered on Hefei. It has also presented a long-term blueprint to double production capacity by 2030 and triple it by 2035.

If CXMT increases production facilities while simultaneously upgrading equipment to improve yield rates, DRAM production volumes could rise even more sharply. Analysts suggest that if CXMT embarks on aggressive production expansion backed by state capital, it could have a significant impact on generic DRAM prices.

Jeon Byeong-seo, director of the China Economic and Financial Research Institute, stated, “It is standard DRAM that will immediately affect SamsungElectronics and SK hynix.” He added, “CXMT has transitioned from DDR4 to DDR5, and while its current yield is reported to be around 40–50%, if it rises to 80–90% in the future, production volume per wafer will increase significantly, further enhancing its price competitiveness.”

SamsungElectronics and SK hynix are generating substantial profits not only from HBM but also from standard DRAM. Industry observers believe that a deterioration in profitability will be inevitable once CXMT’s low-price offensive gains full momentum. Currently, CXMT’s average selling price (ASP) for DRAM is estimated to be about 30% lower than that of SamsungElectronics, SK hynix, and Micron.

Its market share is also expanding rapidly. According to global market research firm Counterpoint Research, SamsungElectronics held a 38% share of the global DRAM market in the first quarter of this year, while SK hynix held 29%. CXMT increased its market share from 3% in the first quarter of last year to 8% in the first quarter of this year and aims to reach 20% in the long term.

China’s full-scale support is another factor accelerating the pace of its catch-up. China, which is fostering the semiconductor industry as a national strategic sector, is aggressively expanding investment in R&D and production with government backing. Under the pretext of “overcoming U.S. sanctions,” and with government approval and tacit consent, the company is maintaining an intense work schedule without regard for labor hour regulations. A business sector official stated, “The CXMT research lab is effectively operating 24 hours a day,” adding, “There is a widespread view in the industry that catching up is ultimately just a matter of time.”

Furthermore, in the wake of “chipflation” caused by rising AI memory prices, global clients are also moving to diversify their supply chains. It is reported that Apple is considering CXMT as a potential supplier, and CXMT is also expanding its base of global clients, starting with DRAM for PCs, further heightening tensions within the South Korean memory industry.