China leverages capital markets to fund semiconductor and AI race

China is increasingly utilizing its stock and bond markets to fund its technological competition with the United States, shifting away from traditional state subsidies toward equity and debt markets. A primary example of this strategy is the record-breaking Shanghai debut of memory chipmaker CXMT Corp. (formerly ChangXin Memory Technologies).

CXMT’s IPO raised 57.92 billion yuan ($8.6 billion), marking the largest semiconductor offering on mainland China to date. Following its debut, the company’s market capitalization reached 3.3 trillion yuan ($488 billion), briefly surpassing the Industrial and Commercial Bank of China to become the most valuable onshore-listed company in the country.

Investors are currently focused on two major pillars of Chinese tech: memory independence and AI infrastructure. While CXMT represents China’s push for self-reliance in the DRAM sector to reduce dependence on foreign firms like Samsung and SK Hynix, Zhongji Innolight is emerging as a key player in AI infrastructure through its production of optical modules for data centers. Other firms, including Z. AI, MiniMax, Moonshot AI, and DeepSeek, are also reportedly preparing for public offerings.