RESOLVING THE LEDGER
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On Monday, Chinese memory manufacturer CXMT made its initial public offering on Shanghai's STAR stock market. This debut was the biggest in Asia this year, raising $8.6 billion and seeing shares in the company surge by 466%. In terms of valuation, that places CXMT right at the top of China's stock market.
CXMT's market capitalisation is now about $487.73 billion. Major player Tencent still outpaces it at a little over $500 billion, but that makes CXMT's stock market debut no less show-stealing. In fact, according to Reuters , the memory manufacturer is now a more valuable listed company than even the Industrial and Commercial Bank of China.
Even before this news, CXMT was already one to watch; the company's plans to massively ramp up DRAM manufacturing capacity in the midst of the RAMpocalypse has made its products an appealing option for a number of PC component makers . Furthermore, recent reports suggest that CXMT is planning to expand overseas into the US market at some point in the future.
CXMT's rise may be far from unstoppable, though. Trinity Synergy Investments' hedge fund manager Yuan Yuwei told Reuters, "The stock is too expensive and smells of speculation."
CXMT's stock closed at 49 yuan, after reaching an intraday high of 55.03 yuan. Compared to the stock's sale price of 8.66 yuan per share, that's a sharp uptick. This appetite is unsurprising during these times of memory shortage. But given the current supply crisis is being fuelled by outsized demand from the AI industry, it's hard not to wonder whether this excitement will find itself confined to a bubble . Yuwei went on to add, "It's hard to say the optimism is sustainable."
(Image credit: Alvaro Gonzalez via Getty Images)
Outside of China, CXMT is still overshadowed by memory's other major players. Looking at the 'big 3', SK hynix is currently enjoying a market capitalisation of over $777 billion, Micron has $1.04 trillion , and Samsung has over $1.135 trillion at time of writing. Even so, Micron has reportedly been looking over its shoulder, urging US lawmakers to curb CXMT's access to chipmaking equipment .
Bubble or no bubble (though, if you're asking me, probably definitely a bubble), CXMT will continue to be the name on the industry's lips—especially as it's seemingly found at least one powerful ally. Sources claim that Apple has recently sought assurances that the memory manufacturer won't be placed on the US Department of Commerce's 'Entity List'. Having raised Mac and iPad prices due to runaway memory costs , it's little wonder why CXMT may have caught Apple's eye. If Apple succeeds in bringing CXMT memory to its tablets and phones in the US, then it probably won't be long before you start to see CXMT DRAM in a PC near you .
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