According to the results of the second quarter of this year previously noted by representatives of Counterpoint Research, the Chinese company Yangtze Memory successfully became one of the world’s three largest flash memory manufacturers, accounting for 14% of the global market. Now the company, which is gearing up for an IPO, has told potential investors it aims to be number one by the end of 2027.
Image source: Yangtze River Storage
This is caused by financial times Sources familiar with the discussions between Yangtze Storage and potential investors were quoted as saying. As noted recently, the company expects to raise nearly $5 billion during the IPO. Most of these funds are planned to be used to expand NAND production, and about one-third will be used for the research and development needed to bring the next generation of 3D NAND to the market in a timely manner.
In the most optimistic scenario, Yangtze Storage is expected to be valued at about $150 billion when it goes public, which would make it the second-largest company on the Chinese stock market. However, sources pointed out that regulators may limit the price of the stock issuance. In this case, Yangtze Storage’s final valuation may be as much as five times lower than the company itself expected.
Yangtze Storage can refer to the example of Changxin Storage, which specializes in the production of DRAM. The company listed on the stock exchange last month with a valuation of $580 billion, making it China’s most valuable listed company. During this IPO, Changxin Storage raised US$9 billion, becoming the largest placement transaction in the Asian stock market this year.
At the same time, the boom in artificial intelligence is driving the rapid growth of the memory market. According to TrendForce, if the global NAND market was $71 billion last year, it will exceed $300 billion this year and be close to $490 billion by the end of the decade. Investors are worried about Chinese manufacturers’ plans to rapidly increase production capacity, but most believe that even such aggressive expansion of production will not fully meet demand. As a result, they believe the market is unlikely to become oversaturated in the coming years.
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