Everyone is fixated on the myth of Changxin Technology creating a market cap of 3.3 trillion yuan on its first day of listing, but if we dig deeper, the multiple layers of logic behind the frenzy of capital are worth discussing more:

1) What the capital market is truly pricing Changxin Technology on is not simply a “domestic substitution” narrative. Fundamentally, it has broken the decades-long, near-monopoly setup held by Samsung, SK hynix, and Micron, forming the fourth pillar in the global DRAM market.

Previously, the three giants combined for a long-term market share of over 90%, with pricing power highly concentrated—so the cycle of price rises and falls was driven almost entirely by their production rhythm and inventory strategies. Meanwhile, Changxin Technology has grown from scratch to a global share of about 7.7%–8% by the first quarter of 2026. And after the three giants shifted their most advanced production capacity at scale to high-margin HBM, the supply of general DRAM (for phones, computers, and standard servers) was systematically squeezed. Changxin has happened to fill this structural gap.

Moreover, since China’s market already has the ability to alter supply-demand dynamics and price elasticity, the emergence of ChangXin’s fourth pillar can compress the combined price-setting room of the so-called “three giants.” This is the underlying logic by which the capital market truly prices ChangXin Technology;

2) Some say it’s a good story that Hefei state-owned capital invests for ten years and achieves returns that outperform selling land after ten years. But more importantly, Hefei state-owned capital’s successful investment case may rewrite the capital valuation and attractiveness to investors for China’s A-share semiconductor industry.

Previously, the storage sector on the STAR Market had long been “designed but without manufacturing leading companies.” Institutional investors (pension funds, index funds, and foreign investors) lacked large-cap anchor assets that could be allocated according to global frameworks. ChangXin’s sample effect lies in proving to the market that A-share hard-tech sectors are not only about high-volatility, small-cap stories; they can also nurture manufacturing leaders like ChangXin that can be benchmarked against global peers.

This undoubtedly reduces the difficulty of financing for subsequent large projects, further shifting the STAR Market on China’s A-share market—which is primarily driven by retail investors and themes—toward greater institutionalization and performance orientation. It also, to some extent, fosters investment opportunities in the STAR Market sector going forward, attracting more long-term capital to continue entering;

3) Of course, some people also worry that ChangXin Technology’s exaggerated short-term valuation might cause a persistent siphoning impact similar to historical cases like PetroChina and SMIC. After all, the aftershocks of SpaceX’s disruption to the entire U.S. AI technology sector are still enough to make people uneasy.

However, on its first day ChangXin’s tradable float was only about 6.7% (around 4.5 billion shares), with more than 90% locked up. Combined with the absence of any daily price-change limits during the first five days, the tiny amount of shares available for trading was chased by massive capital, naturally forming a premium pricing for a “scarce asset.”

When Zhejianxin—which had previously enjoyed a premium valuation from ChangXin—crashes today, it shows that the market’s expectations are starting to shift from “concepts” to “real manufacturing leading companies.” This will certainly siphon off liquidity in the short term from older stocks within the market that are more concept-driven. But in the long run, it’s not necessarily a bad thing for funds to move from stories to manufacturing leaders with real production capacity. Perhaps, under a newly repriced structural trend, a batch of value stocks with real production capacity and supply-chain demand may be rediscovered.