According to a research report, the IPO price for Changxin Technology on the STAR Market has been set at 8.66 yuan per share, with an expected total fundraising of approximately 57.919 billion yuan. If the over-allotment option is fully exercised, this amount could reach 66.607 billion yuan. The projects to be funded by the IPO are expected to use 29.5 billion yuan, primarily for technological upgrades and transformation of the mass production line for memory wafer manufacturing.
The combination of explosive AI demand and a cyclical upswing has propelled the global semiconductor industry into a new super-cycle of capacity expansion. SK Hynix reported a 397.47% year-on-year increase in net profit for the first quarter of 2026. Changxin Technology is forecasted to achieve a net profit attributable to the parent company of 50 to 57 billion yuan for the first half of 2026, representing a year-on-year growth exceeding 22 times.
SEMI predicts the global semiconductor equipment market could reach $229.5 billion by 2028. Data from Bernstein indicates the domestic substitution rate for China's wafer fab equipment (WFE) has risen from 16% in 2024 to 21% in 2025, with an expected further increase to approximately 26% in 2026. The semiconductor equipment industry is currently experiencing a dual boost from "AI-driven capacity expansion" and "domestic substitution."
Key Drivers: AI Demand and Industry Upswing
Unlike previous cyclical fluctuations, the incremental demand in this cycle is driven by AI, which not only expands market capacity but also extends the industry's growth phase. The rapid demand surge has led to supply shortages, driving up semiconductor prices and significantly improving corporate profitability. For instance, SK Hynix's Q1 2026 revenue reached 52.58 trillion won (approximately 239.1 billion yuan), a 198.07% year-on-year increase, with a net profit of 40.33 trillion won (approximately 183.381 billion yuan), up 397.47% year-on-year. Its gross margin was 79.27% and net margin 76.74%.
Changxin Technology is projected to report revenue between 110 and 120 billion yuan for H1 2026, a year-on-year increase of 612.53% to 677.31%, with an estimated net profit attributable to the parent company of 50 to 57 billion yuan, soaring by 2244.03% to 2544.19%.
Improved corporate earnings are the primary driver for capacity expansion. The South Korean government, along with SK Group and Samsung Group, have collectively announced investment plans totaling 20 trillion yuan. Domestically, companies like Changxin and Changcun have initiated IPO processes to accelerate their expansion plans.
Global Semiconductor Equipment Market Outlook
In its Mid-Year Total Semiconductor Equipment Forecast, SEMI projects that global sales of semiconductor manufacturing equipment (OEM) will hit a record high of $165.9 billion in 2026, a 23.2% year-on-year increase. This growth momentum is expected to continue through 2028, with total equipment sales potentially reaching a new record of $229.5 billion.
Within the Wafer Fab Equipment (WFE) segment, which includes wafer processing, fab facilities, and mask/reticle equipment, sales are forecast to grow 23.1% to $143.9 billion in 2026. WFE sales are expected to grow another 21.8% in 2027 and 14.1% in 2028, surpassing the $200 billion mark.
Sales of semiconductor test equipment are projected to increase 31% to $15.3 billion in 2026, while packaging equipment sales are expected to rise 9.6% to $6.7 billion. By 2028, the test equipment market is forecast to reach $20.8 billion and the packaging equipment market $8.6 billion.
Accelerating Domestic Substitution in Equipment
According to Bernstein data, the domestic substitution rate for China's Wafer Fab Equipment (WFE) reached 21% in 2025, up 5 percentage points from 16% in 2024. It is anticipated to rise further to around 26% in 2026.
Potential Risks
Risks include the cyclical volatility of the semiconductor industry and the potential for capacity expansion to fall short of expectations.