A city, betting on an "impossible" project, suffered losses for ten consecutive years, burning through a total of 36.6 billion yuan, and finally reaping a trillion-yuan return—This is not fiction, this is Hefei.
On July 27, 2026, Changxin Technology (688825) officially listed on the Science and Technology Innovation Board, with a final closing price of 49 yuan, a surge of 465.82% compared to the issue price,its market value broke through 3.2 trillion yuan, surpassing the Industrial and Commercial Bank of China,becoming the "market value king" of A-shares.
This largest DRAM chip manufacturer in China and the fourth largest globally has stepped into the spotlight of the capital market after a full decade of operation. In terms of issuance scale, Changxin Technology's IPO has set a new record on the Science and Technology Innovation Board. The company plans to publicly issue 6.688 billion shares. Before the exercise of the over-allotment option, the total share capital after the issuance will be 66.881 billion shares, corresponding to a total market capitalization of 579.188 billion yuan. If the over-allotment option is fully exercised, the company expects to raise a total of 66.607 billion yuan, surpassing SMIC's 53.23 billion yuan fundraising scale in 2020, becoming the largest IPO in the history of the Science and Technology Innovation Board and ranking among the top three in the history of A-share IPO fundraising. And the city that has stood behind this company for ten years, supporting it day after day, is now quietly fulfilling a historic promise. Hefei State-owned Assets Supervision and Administration Commission (SASAC) is the largest shareholder of Changxin Technology. Based on its approximately 36.79% stake, the corresponding book value exceeds 1.2 trillion yuan. Thanks to the massive increase in market capitalization brought by Changxin Technology alone, Hefei's total A-share market capitalization has surpassed 4 trillion yuan, making it the second-largest A-share market capitalization city in the Yangtze River Delta region—a "high-stakes gamble" from a central provincial capital city, writing the most impressive chapter in the history of industrial investment in China.
One Man's Twenty Years of Perseverance
To understand why Hefei dared to invest, you must first understand Zhu Yimingthis person.
Zhu Yiming, a native of Yancheng, Jiangsu Province, entered Tsinghua University in 1989. After graduating with a master's degree, he went to the United States for further studies, switching to the semiconductor field, and studied at Stony Brook University, State University of New York. After graduation, he entered Silicon Valley and served as a project manager in a memory chip company. There, he witnessed a distressing reality: memory chips are the most consumed and standardized category of semiconductors, the "fuel" for almost all electronic devices, yet Chinese players have long been absent from this field. In 2004, he made a life-changing decision—to resign and return to China to start his own business. The initial capital was $920,000, pooled together by several Tsinghua University alumni. After the Spring Festival in 2005, he founded GigaDevice in a two-story unfinished building in Tsinghua Science Park. Instead of directly competing with giants like Samsung and SK Hynix, he entered the "sideline" market of NOR Flash, accumulating initial capital. In 2016, GigaDevice successfully went public. But Zhu Yiming's ambitions went far beyond that. He once said, "If you compare a computer to a crown, the CPU is the jewel in the crown, and the memory is the base." "Whoever leads in memory technology will dominate the entire integrated circuit industry." Building a Chinese version of "Samsung Electronics" was his ultimate goal, which he never wavered from day one. It was also in 2016 that the opportunity arrived. At that time, the global DRAM market was firmly controlled by the three giants Samsung, SK Hynix, and Micron, with China's independent production capacity being almost zero. The DRAM industry has extremely high requirements for capital, talent, and technology, and its strong cyclical nature causes drastic fluctuations in product prices, making losses almost an unavoidable "entry tax." Hefei at that time was not well-off. But Hefei decided—to do it. This is the strategic project later named "506": the Changxin 12-inch memory wafer manufacturing base, with a total investment of approximately 150 billion yuan. The first phase of the project involved a total investment of 18 billion yuan, with Hefei Investment contributing 14.4 billion yuan, accounting for a staggering 80%. In 2016, this was practically equivalent to selling everything they owned. Even more commendable is that Hefei chose to "truly participate." During the darkest period of Changxin Technology's consecutive years of losses, accumulating deficits exceeding 36.6 billion yuan, Hefei State-owned Assets Supervision and Administration Commission (SASAC) did not back down or withdraw its investment. In fact, when other investors withdrew at the end of 2024, SASAC proactively invested nearly 2 billion yuan to take over existing shares. A relevant person in charge of Hefei Industrial Investment once succinctly summarized the essence of this logic: "In weak links of the industrial chain such as chips, the probability of achieving capital returns in the short term is very small. Value investing requires large amounts of capital, a long cycle, and even spanning several cycles." This wasn't a gamble; it was a city's profound understanding of industrial dynamics and its clear-headed judgment of national strategic needs. The path Changxin took was far more perilous than outsiders imagined. Fujian Jinhua, established around the same time as Changxin, saw its multi-billion yuan investment project abruptly halted on the eve of mass production after being sued by Micron for stealing trade secrets. Changxin chose a different path—through legal negotiations, it acquired over 10 million DRAM technical documents, 2.8TB of core data, and a large number of Infineon DRAM technology patents from the bankrupt German memory giant Qimonda for "hundreds of millions of US dollars." In 2018, Zhu Yiming made a decision that shocked the capital market: he resigned as general manager of GigaDevice and took on the full-time role of chairman and CEO of Changxin Technology, vowing not to accept any salary or bonus until the project became profitable. A year later, in September 2019, Changxin Technology launched its independently designed and manufactured 8Gb DDR4 chip, marking a historic breakthrough for China's mainland DRAM industry, from "zero to one." But "going from zero to one" is just the entry ticket. The real test came in 2023. That year, global DRAM prices plummeted by over 40%, mobile phone and PC shipments declined, and the industry entered a deep downturn. The three giants, leveraging their cost advantages, employed a "counter-cyclical" strategy, maintaining high shipment volumes to further squeeze out new players. Changxin lost money on every unit sold, yet still accelerated its efforts to overcome the 1x nanometer process despite huge losses, breaking through key technological barriers to DDR5 mass production. The company suffered a loss of 16.34 billion yuan that year, a record high since its establishment, with accumulated losses reaching 36.65 billion yuan over ten years. Any commercial institution, faced with such results, would have already cut its losses and left. But Hefei did not. During Changxin's darkest hour of continuous losses, Hefei's state-owned assets chose to repeatedly increase investment, provide resources, and supply ammunition. In that same year, the Standing Committee of the Hefei Municipal People's Congress reviewed and approved a proposal to increase capital and expand production. At the end of 2024, Country Garden Venture Capital withdrew, and Hefei's state-owned asset platform invested nearly 2 billion yuan to take over the existing shares without hesitation. Behind this, Hefei has established a systematic fault-tolerance mechanism: projects must be reviewed by the Finance and Economic Committee of the People's Congress before being included in the project pool, and major decisions must be voted on by the Standing Committee. As long as due diligence is compliant and procedures are followed, even if the project ultimately incurs losses, the decision-maker will not bear personal responsibility. It is understood that Hefei has never punished any unit or individual for failed industrial investments. It is precisely this system of "being able to afford to lose" that allows Hefei to become a truly patient capital when other cities are hesitant. Earning 400 million a day, ten years of losses were covered in one quarter. The turning point quietly arrived in 2025. The demand for AI computing power has completely ignited a storage supercycle. An AI server uses 3 to 5 times more DRAM than a traditional server, and Samsung, SK Hynix, and Micron have all shifted their production capacity to the more profitable HBM, significantly widening the supply gap for conventional DRAM. Changxin Technology has just completed its product iteration from DDR4 to DDR5, and the capacity utilization rate of its three 12-inch wafer fabs has steadily increased from 85% to 95%. Soaring demand, contracting supply, and increased capacity—these triple benefits combined to create a textbook example of a "Davis Double Play." In 2025, Changxin Technology achieved its first annual profit, with net profit attributable to shareholders of RMB 1.875 billion. In the first quarter of 2026, revenue reached RMB 50.8 billion, and net profit attributable to shareholders reached RMB 24.762 billion, a year-on-year increase of 1688%. That translates to nearly RMB 400 million per day. At this pace, in less than six months, Changxin had almost made up for all the losses of the previous ten years. At this moment, Hefei's initial investment of 14.4 billion yuan, along with the continuous investment over the next ten years, finally realized its value. Beyond the trillion-yuan unrealized profit: The industrial restructuring of a city. The 1 trillion yuan on paper is just the tip of the iceberg of Hefei's returns. Ten years ago, the northwestern suburbs of Hefei, where the Changxin factory was located, were still a rural area interspersed with farmland and wasteland. Today, the massive gray-white factory buildings stretch for hundreds of meters horizontally, with a dense network of silver ducts, corridors, and industrial pipelines intertwined in the air. Around the factory area, R&D buildings, employee apartments, canteens, commercial centers, fast food restaurants, and supermarkets have opened one after another, earning it the nickname "Changgang CBD." As of the end of 2025, Changxin Technology had a total of 19,300 employees, including over 6,000 R&D personnel, mostly between 25 and 35 years old, with the majority holding master's degrees or higher. These young, highly educated employees with strong purchasing power are fundamentally changing the consumption structure and urban character of the surrounding area. The changes at the industry chain level are even more profound. Relying on the leading role of Changxin Technology, Hefei has gathered over 450 integrated circuit companies, forming a complete industrial chain from design and manufacturing to packaging and testing, making it one of the few cities in China with a complete integrated circuit industrial chain. In 2016, the output value of Hefei's integrated circuit industrial chain was only about 18 billion yuan; by 2025, this figure has reached 151.4 billion yuan, an increase of 7.4 times. Even more noteworthy is the industrial synergy effect. Changxin's memory chips, BOE's panels, and NIO and BYD's new energy vehicles together constitute Hefei's "chip-display-automobile integration" industrial landmark, forming a mutually supportive and deeply integrated industrial ecosystem—Jinghe Integrated manufactures panel display driver chips for BOE, and Jiefa Technology supplies automotive-grade MCU chips to BYD and NIO; the internal circulation of the industrial chain is accelerating. Why Can't Others Learn the "Hefei Model"? After Changxin Technology's IPO, the outside world once again focused on the "Hefei Model." However, in reality, while approximately 50 inspection teams flock to Hefei every month, producing millions of words of research reports, no truly replicable model has yet emerged. Hefei itself has clearly stated that this model has four prerequisites, none of which can be missing. Sufficient financial resources are essential. In 2008, Hefei invested 6 billion yuan in BOE Technology Group, equivalent to 20% of its fiscal revenue that year. The Changxin project bore the burden of losses for ten years, accumulating to 36.6 billion yuan. Without corresponding fiscal flexibility, this problem would have been impossible to solve. The fault-tolerance mechanism is robust. Hefei pioneered the "due diligence exemption" system nationwide. As long as project decisions are procedurally compliant and due diligence is thorough, even if there are losses, the decision-maker is not personally liable. The local government has never punished any unit or individual for investment failures; this is the institutional foundation for its "daring to invest." The industry judgment is accurate. Every move Hefei makes occurs at the industry's coldest moments—BOE when the global panel industry was suffering huge losses, NIO when its stock price plummeted to $1 and it was rejected by 18 cities, and Changxin when there were no Chinese players in the global DRAM market. This counter-cyclical strategy relies on a systematic assessment of industry trends over many years, rather than chasing fleeting trends. The policy window is wide enough. Hefei has caught up with the golden decade of China's manufacturing industry's transition from low-end to mid-to-high-end, with a real and urgent demand for domestic substitution. As Guojin Macro's Song Xuetao team pointed out, Changxin "caught up" with the triple convergence of domestic substitution, storage security, and expanding AI demand, which in itself demonstrates the foresight of the national strategic planning. The Paradigm Shift in China's Urban Development Behind Changxin Technology's IPO, a more macro-level issue is emerging: beyond land revenue, urban development needs new engines. Hefei's path offers one answer: using state-owned capital as early-stage funding, then leveraging the capital market to amplify it, building a system capable of continuously producing good companies. During the real estate boom from 2015 to 2021, Hefei's total land transfer revenue was approximately 551.6 billion yuan; while for Changxin Technology alone, Hefei's state-owned assets held a paper profit of nearly 1 trillion yuan. This is not just Hefei's story, but a paradigm shift in the competitive logic of Chinese cities: from "attracting investment" to "cultivating industries," from "land finance" to "equity finance," and from "transplanting a single tree" to "creating a forest." The listing of Changxin Technology is the culmination of Hefei's ten years of patient capital investment, and also an unavoidable test for many other cities.
Anais
Weatherly