Tencent Emerges as Biggest Winner in Enflame Technology's STAR Market IPO

Tencent is the largest external shareholder and a major strategic investor in Enflame Technology's STAR Market IPO, according to Jiemian News. Through its platform, Tencent took 1.7471 million shares in the strategic placement for 248 million yuan, while Tencent Technology (Shanghai) directly held 77.267 million shares, or 19.9493%, before the offering. Together with its concert party Suzhou Paiyi, Tencent's pre-offering stake was 20.2580%, and about 20.26% after the issue. Enflame set the IPO price at 142.18 yuan per share and sold 43.035173 million shares, raising an expected 6.119 billion yuan. The company said its market value at listing would be about 61.187 billion yuan. The strategic placement drew 10 investors who were allotted 8.607034 million shares, or 20% of the offering. Tencent's Shanghai Qishan Investment received the largest allocation and the longest lock-up, at 36 months. Other strategic investors included Xiaomi, GigaDevice, ZTE, Tongfu Microelectronics, Shanghai Huali Group, Shanghai Instrument Group, the National Social Security Fund, and the basic pension fund. The prospectus said Tencent was Enflame's largest customer, with sales of 100 million yuan in 2023, 427 million yuan in 2024 and 830 million yuan in 2025, equal to 33.34%, 59.14% and 83.79% of revenue, respectively. Enflame's revenue rose from 301 million yuan in 2023 to 722 million yuan in 2024 and 990 million yuan in 2025, while net losses attributable to shareholders narrowed from 1.665 billion yuan to 1.318 billion yuan and then 827 million yuan over the same period. The company has warned of heavy dependence on Tencent, including a near-97% share of sales of its S60 inference card to Tencent-related entities.