Chinese memory chip stocks surge

Chinese memory-chip-related stocks surged on Monday, led by Shenzhen Longsys Electronics Co Ltd, partly as investors reacted to the impending US listing of South Korean memory chip giant SK Hynix.

Longsys jumped as much as 13 percent in early trading before consolidating gains to close at 681.8 yuan ($100) in Shenzhen. Other memory chip stocks followed suit. CECport hit the daily upside limit, while companies such as JCET advanced.

The sector's momentum was amplified by SK Hynix's upcoming Nasdaq debut. The chipmaker is set to debut on Friday, raising approximately $29 billion in what could be the largest-ever US IPO by a foreign company, Bloomberg reported.

The listing, to be conducted through American Depositary Receipts, or ADRs, under the ticker "SKHY," aims to bridge the valuation gap with US rival Micron Technology.

The timing coincides with explosive growth in the memory chip market. Market research firm Gartner said global chip sales are expected to approach 9 trillion yuan in 2026, up 64 percent year-on-year, with memory chip sales estimated at around 4.3 trillion yuan.

Market researcher TrendForce's latest memory pricing survey said the DRAM market will see extremely tight supply in the third quarter, with contract prices expected to rise 13 to 18 percent quarter-on-quarter. NAND Flash contract prices are likely to increase 10 to 15 percent quarter-on-quarter.

DRAM and NAND are key memory chips widely used in smartphones, PCs, tablets and other digital products.

While artificial intelligence inference and data center deployments continue to drive demand, price increases have moderated from previous quarters as consumer PC and smartphone customers reach their affordability limits, TrendForce said.

"AI remains the core driver," TrendForce added. Memory suppliers are shifting capacity toward higher-margin server products, constraining supply for consumer segments and keeping prices elevated even as PC and smartphone demand weakens.

The global supply shortage and surging AI demand for high-bandwidth memory have fueled the memory supercycle. Meanwhile, China's domestic memory industry is making strides, though a gap with Western leaders persists, experts said.

CXMT Corp, China's largest manufacturer of DRAM chips, is expected to launch its IPO later this year, while the listing plan of Yangtze Memory Technologies, China's only company capable of end-to-end 3D NAND flash chip manufacturing, has also received approval.

Shen Meng, director of Chanson & Co, a boutique investment bank, said market watchers are closely monitoring SK Hynix's Nasdaq performance as a potential reference for the two Chinese IPOs.

Roger Sheng, vice-president of research at Gartner, said that Chinese memory chip firms have made significant progress, but there remains a significant gap in both advanced technologies and production capacities between Chinese memory leaders and their global counterparts, pointing to substantial room for expansion.