Executive Summary
Key takeaways from the recent surge in Chinese semiconductor equities:
- AMD CEO Lisa Su (苏姿丰) announced export approval for MI308 AI chips to China, sparking a rally in related stocks like Haiguang Information (海光信息) and Cambrian (寒武纪).
- Domestic chip counterattack gains momentum with rapid IPO approvals for companies like Moore Threads (摩尔线程) and Metax (沐曦), highlighting strengthened capital market support.
- China’s semiconductor self-sufficiency drive accelerates, with companies like Superfusion (超聚变) reporting explosive revenue growth and securing state-backed investments.
- Analysts project long-term opportunities in AI and国产替代 (domestic substitution), though market volatility requires careful risk management.
- Global AI chip competition intensifies, with Chinese firms poised to capture market share amid ongoing U.S. export restrictions.
The Phone Conference That Ignited the Rally
On November 6, Chinese equity markets defied global trends with a robust performance, led by a dramatic upswing in semiconductor stocks. The Shanghai Composite Index and the STAR Market (科创板) saw significant gains, largely driven by key players in the domestic chip sector. This surge represents a pivotal moment in the ongoing domestic chip counterattack, underscoring how external catalysts can rapidly reshape market dynamics.
AMD’s Strategic Announcement
Advanced Micro Devices (AMD) CEO Lisa Su (苏姿丰) revealed during the Q3 earnings call that the company’s Instinct MI308 AI accelerator had received an export license for the Chinese market. While AMD has not incorporated potential Chinese revenue into Q4 forecasts, the news immediately resonated with investors. The MI308 is viewed as a strong competitor to NVIDIA’s H20 chip, and its approval could provide AMD with a temporary edge in China, where NVIDIA’s Blackwell series remains under regulatory scrutiny. Su emphasized the fluidity of the situation, stating, ‘We are grateful for government support on MI308 licensing and are engaging with potential clients to assess demand.’
Immediate Market Impact
Haiguang Information (海光信息), a long-standing AMD partner since 2016, soared over 10% in early trading, becoming the top contributor to the Shanghai Index’s rise. Cambrian (寒武纪) followed with a 7% gain, while the Chip ETF (芯片ETF) climbed nearly 4%. This rally occurred amid growing skepticism about AI valuations, suggesting renewed confidence in homegrown tech capabilities. The domestic chip counterattack is not just a flash in the pan; it reflects deeper structural shifts in supply chains and investor sentiment.
Key Players Driving the Semiconductor Surge
Several Chinese semiconductor firms are at the forefront of this rally, benefiting from both international partnerships and domestic policy support. Their performance highlights the sector’s resilience and growth potential, even as global tech tensions persist.
Haiguang Information’s Strategic Position
Haiguang Information (海光信息) has emerged as a bellwether for China’s chip industry. The company’s collaboration with AMD provides it with access to advanced technologies, while its focus on domestic markets aligns with national priorities. With a market cap approaching 500 billion yuan, Haiguang’s stock movement significantly influences broader indices. Analysts note that its surge on November 6 helped lift the entire semiconductor segment, demonstrating its pivotal role in the domestic chip counterattack.
Cambrian and AI Innovation
Cambrian (寒武纪), specializing in AI chips, also posted substantial gains. As a pioneer in neural processing units, Cambrian benefits from China’s push toward AI self-sufficiency. The company’s products are integral to data centers and smart devices, sectors prioritized in government industrial plans. Its stock performance underscores investor belief in homegrown AI solutions, a key aspect of the domestic chip counterattack narrative.
The Broader Context of Domestic Substitution
Beyond immediate market reactions, the rally reflects a sustained drive toward semiconductor self-sufficiency. Regulatory approvals, capital inflows, and strategic partnerships are accelerating this transition, reducing reliance on foreign technology.
Accelerated IPO Approvals
Recent weeks have seen rapid progress for Chinese chip firms seeking public listings. On October 30, the China Securities Regulatory Commission (CSRC) approved Moore Threads Intelligent Technology (摩尔线程智能科技) for a STAR Market IPO. The company’s application, submitted on June 30, moved through reviews in just three months, signaling regulatory urgency. Similarly, Metax Integrated Circuit (沐曦集成电路) secured listing approval on October 24 after a 116-day process. These developments highlight how capital markets are mobilizing to support the domestic chip counterattack.
State-Backed Investments
Superfusion Digital Technology (超聚变数字技术), formerly Huawei’s x86 server division, has attracted significant funding from the National Structural Adjustment Fund (国调基金), managed by China Chengtong Holdings (中国诚通控股集团). Superfusion’s revenue skyrocketed from 100 billion yuan in 2022 to over 400 billion yuan in 2024, capturing the top spot in China’s standard liquid-cooled server market. This investment pattern mirrors earlier support for SMIC (中芯国际) and Huaxin Dingxin (华芯鼎新), reinforcing the state’s commitment to semiconductor sovereignty.
Expert Insights and Market Analysis
Industry leaders and financial analysts provide valuable perspectives on the sustainability of this rally and its implications for global investors.
Regulatory and Geopolitical Factors
Kaiyuan Securities (开源证券) analysts argue that科技安全 (technological security) remains a top priority amid great-power competition. They note that AI and domestic substitution offer long-term certainty, with 2026 likely to transition from ‘asset revaluation’ to ‘profit repair.’ The domestic chip counterattack is underpinned by relative profit advantages, overseas mapping, and global semiconductor cycle synergies. However, they caution that sector performance may become more balanced compared to 2025’s concentrated gains.
Global Competitiveness Outlook
NVIDIA CEO Jensen Huang (黄仁勋) recently stated that ‘China will win the AI race,’ acknowledging the rapid progress of Chinese firms. This sentiment aligns with observations that domestic companies are closing technology gaps through innovation and scale. The domestic chip counterattack is not merely defensive; it positions China as a formidable player in global AI and semiconductor markets.
Investment Implications and Strategic Recommendations
For institutional investors and fund managers, the current environment presents both opportunities and challenges. Navigating the domestic chip counterattack requires a nuanced understanding of regulatory trends, technological advancements, and market sentiment.
Sector Allocation Opportunities
Kaiyuan Securities recommends focusing on four key areas:科技成长自主可控 (tech growth with self-control), PPI improvements coupled with anti-internalization trends,出海+全球产业竞争力提升 (overseas expansion and global industrial competitiveness), and domestic demand restructuring with consumption recovery. Within semiconductors, companies aligned with national strategies—such as those in AI, data centers, and advanced packaging—are likely to outperform.
Risk Management Considerations
While the domestic chip counterattack offers compelling growth prospects, investors must monitor several risks:
- Export control volatility: U.S. policies could shift, affecting technology transfers.
- Valuation bubbles: Some stocks may be overhyped, requiring rigorous fundamental analysis.
- Execution risks: Domestic firms must deliver on innovation and scalability to sustain momentum.
Forward-Looking Market Guidance
The recent surge in Chinese chip stocks marks a significant phase in the industry’s evolution. The domestic chip counterattack is fueled by strategic partnerships, regulatory support, and robust capital market activity. As AI and semiconductor cycles converge, Chinese firms are well-positioned to capture value both domestically and internationally. Investors should prioritize companies with strong technological moats, clear regulatory compliance, and scalable business models. By staying informed on policy developments and market trends, stakeholders can capitalize on this transformative period in global tech equities. Monitor upcoming earnings reports, regulatory announcements, and geopolitical shifts to adjust portfolios proactively. The domestic chip counterattack is more than a temporary rally; it’s a structural shift with lasting implications for global supply chains and investment strategies.