Longsys Electronics (301308.SZ, 09976.HK), a leading memory module manufacturer, began trading on the Hong Kong Stock Exchange's main board on September 8th, making history as the first independent semiconductor memory company to achieve a dual "A+H" share listing. Despite setting its H-share offer price at a roughly 40% discount to its A-share price, the stock fell below its issue price on its first trading day, indicating that market reception fell short of expectations.

The company announced on the evening of September 4th that it had set the final H-share offering price at HK$236 per share. Longsys offered 26.08 million H-shares globally, comprising 2.61 million shares for the Hong Kong public offering and 23.47 million shares for the international placement, with an over-allotment option also in place. Based on the HK$236 issue price, the offering is expected to raise nearly HK$6.2 billion (approximately RMB 5.3 billion).

A notable aspect of this listing is the significant price gap between the H-share offer price and the company's A-share valuation. Calculated against the A-share closing price of RMB 358.22 (about HK$418) on September 7th, the HK$236 H-share offer price represents a discount of roughly 44%. This translates to about RMB 202 per share, which is roughly 56.5% of the current A-share price.

The contrast becomes even more striking when considering that just over a month prior, Longsys completed a RMB 3.7 billion A-share private placement, issuing 6.61 million shares at RMB 560 per share to 21 investors. That placement price was approximately 45% higher than the RMB 386.60 closing price on the day of issuance. In comparison, the Hong Kong offer price is only 36% of the A-share placement price, highlighting three vastly different valuations for the same company's equity within just over two months.

On September 8th, Longsys H-shares opened at the HK$236 issue price but quickly weakened, dipping to an intraday low of HK$232.40, a decline of 1.44% at one point. By the midday break, the stock was trading at HK$234.40, down 0.68% from the issue price, with turnover of approximately HK$912 million and a total market capitalization of around HK$106.8 billion.

Regarding subscription data, the Hong Kong public offering was oversubscribed by 40.32 times, with an allotment rate of 2.85% for lots of 50 shares, while the international placement saw 3.88 times coverage. To bolster the offering's success, Longsys secured 14 cornerstone investors, including Transsion Holdings, Lenovo Group, Lens Technology, TCL Technology, Ingenic Semiconductor, and Colorful Technology, who collectively subscribed to approximately US$151 million (about HK$1.19 billion) worth of shares, representing approximately 18.89% of the offering. All cornerstone shares are subject to a six-month lock-up period.

In contrast to the subdued performance of the H-shares, Longsys' A-shares initially rose during the morning session but turned lower in the afternoon. By the afternoon, the A-share price stood at RMB 355.97, with the H-shares still trading at a roughly 40% discount to the A-shares.

From a fundamental perspective, Longsys posted exceptionally strong results for the first half of 2026. The company reported revenue of RMB 24.09 billion, a 136.26% year-on-year increase, and net profit attributable to shareholders of RMB 10.58 billion, a staggering surge of over 715 times compared to the previous year. Gross margin expanded from 11.0% to 58.2% year-on-year. The company attributes this performance to a surge in AI infrastructure investment that pushed demand beyond supply, rising memory product prices, and inventory that was purchased earlier at lower costs.

However, concerns lurk beneath the stellar financials. As of June 30, 2026, the company's inventory stood at a substantial RMB 25.78 billion, accounting for 60.12% of total assets. Operating cash flow was negative RMB 3.15 billion in the first half, meaning the reported book profits have not been converted into actual cash. Meanwhile, industry-wide quarterly contract price increases for generic DRAM have moderated, narrowing from over 90% in the first quarter to 13% to 18% in the third quarter.

Longsys stated that the proceeds from this offering will primarily fund research and development for AI high-end memory, controller chips, and advanced packaging and testing. Having completed its dual "A+H" listing at what appears to be the peak of the memory industry cycle, whether this memory giant with a market cap exceeding HK$100 billion can translate its fundraising into the ability to navigate future industry cycles remains to be seen.

This article is for informational purposes only and does not constitute investment advice. All information and data are sourced from public channels.