Nomura Targets 7 Trillion! China's CXMT, Largest Sci-Tech Board IPO, Soars 471.59% on Debut, Reaches 3.31 Trillion Yuan Market Cap, Becomes New Market King

China's leading domestic DRAM manufacturer, ChangXin Memory Technologies (CXMT, 688825-CN), officially listed on the A-share STAR Market today (27th). The IPO price was set at 8.66 yuan per share (RMB, same below), and on its first trading day, it opened 471.59% higher at 49.5 yuan, reaching a total market capitalization of 3.31 trillion yuan, surpassing Industrial and Commercial Bank of China (ICBC) to become the most valuable company on the A-share market.

As China's first and the world's fourth-largest memory leader, CXMT's listing on the STAR Market has drawn significant attention. The IPO price was 8.66 yuan per share, raising a total of 57.919 billion yuan, setting a new record for the highest fundraising amount in the STAR Market's IPO history. Based on an average first-day gain of 278.01% for all new shares, the profit per lot for CXMT is approximately 12,000 yuan; using the STAR Market's average new share gain of 466.67%, the profit per lot is about 20,200 yuan.

CXMT initially issued 6.688 billion shares. After strategic allocation rebalancing and reallocation between institutional and retail investors, and including CICC's 15% over-allotment option, the final issuance scale expanded to 7.691 billion shares. Of these, 3.851 billion shares were ultimately allocated to retail investors, with 94.288 million valid subscriptions and a lottery win rate of 0.47%, the highest in STAR Market history. Institutional investors (offline) received 2.173 billion shares, with public funds and other Category A institutions receiving 91%. Strategic placements were reduced to 1.667 billion shares, with the National Council for Social Security Funds securing 866 million shares (51.95% of strategic allocation) through 36 portfolios. Insurance funds, supply chain companies (Tokyo, Tongfu Microelectronics, Zhongwei, etc.), sponsor co-investment, and employee asset management plans followed, with lock-up periods ranging from 12 to 36 months.

Liang Wenfeng, founder of DeepSeek, and his Quantitative Fund Fangfang and Jiuzhang Asset collectively received 202.497 million shares. Ningquan Asset's Yang Dong also participated in the offline placement.

On its first trading day, approximately 4.503 billion shares of CXMT were tradable, representing 67.33% of the initial issuance, corresponding to a floating market cap of about 39 billion yuan. With a rough 60% turnover rate, if the market cap exceeds 3 trillion yuan, the single-day trading volume could surpass 120 billion yuan, potentially setting a new record for individual A-share stock trading volume.

The market generally expected a strong first-day performance for CXMT, but the recent pullback in hard-tech stocks since July and cooling investor sentiment may limit speculative premiums. According to institutional simulation data, a 2 trillion yuan market cap corresponds to a per-lot profit of 10,600 yuan, 3 trillion yuan to 18,100 yuan, and 4 trillion yuan (near 60 yuan per share) to 25,600 yuan.

On the listing day, Nomura Securities initiated coverage on CXMT with a "Buy" rating and a target price of 116 yuan, based on a 20x P/E multiple applied to the 2028 forecast EPS of 5.79 yuan, implying an upside of approximately 1239% from the IPO price, corresponding to a market cap range of 7.87 trillion to 9.76 trillion yuan.

Nomura's core rationale is that AI memory demand could grow over 7x between 2026 and 2030 (CAGR over 60%), and even after factoring in 4x compression from efficiency technologies, it will still far exceed the industry's 30%-40% supply growth rate. CXMT's monthly production capacity is expected to increase from 280,000 wafers by the end of 2025 to 400,000 wafers by the end of 2028. Its global DRAM market share is projected to rise from the current ~10% to ~18% by 2028, approaching Micron's 20%+ level.

Nomura forecasts CXMT's net profit attributable to shareholders will reach 130.3 billion yuan in 2026 and 393.07 billion yuan in 2028, nearly tripling in three years with a CAGR of 74%, suggesting the broker views this year not as a cyclical peak but as a starting point. The firm deliberately avoided using P/B or low P/E anchors typical for cyclical stocks, instead applying a 20x P/E multiple for growth stocks, reflecting a triple premium of "market share growth + domestic substitution + AI supply-demand tightness."

The fundamental divergence lies in the valuation metric used. Mainstream Chinese institutions use P/B as the sole anchor for cyclical stocks: Guotou Securities estimates 1-4.25 trillion yuan, Huaxi Securities gives a neutral 2-3 trillion yuan, citing Micron's P/E reaching 4x in 2021 followed by a 70% drop, and around 5x in 2018 followed by a 55% drop, indicating that DRAM peak P/E is inherently distorted. On the issuance side, valuations are more conservative: using last year's non-recurring net profit, the P/E ratio reaches 308.92x; using 2026's projected profit, the issuance market cap corresponds to only 4-5x P/E. The current market pricing hovers around "near 3 trillion," while Nomura's 7 trillion yuan target represents a long-term optimistic scenario, not the consensus for first-day pricing.

CXMT's current main process nodes are 16-17nm, with DDR5 yields around 80% and DDR4 over 90%. The company is continuously advancing toward more advanced processes and HBM3 development, with its Shanghai plant planning around 50,000 wafers per month of HBM packaging.

Experts point out that China accounts for 25% of global DRAM demand, but local production is only about 10%, with a domestic self-sufficiency rate of 30%, leaving room for customer adoption, but risks remain: the strong cyclical nature of DRAM has not disappeared, and capacity expansion reversals could immediately crush gross margins. Although the small floating shares on the first day make it easy to speculate, 12 months after listing, strategic placement unlocks, and 6 months later, 70% of offline shares unlock, potentially amplifying selling pressure. A 20x P/E is double Micron's five-year average (around 10x), and if AI demand or market share growth falls short, the premium correction could also be twofold.

CXMT's listing marks a pivotal moment for China's domestic DRAM industry, transitioning from "mass production breakthrough" to "capital pricing power," and represents the A-share market's first attempt to measure the long-term discounted value of "memory self-reliance" with trillions of yuan in capital. The first trading day serves as a liquidity stress test, while three years later will be the final verdict on whether Nomura's P/E metric holds true.