Investment panelists at the 6th JWSS see more value in the STAR Market of the Shanghai Stock Exchange as the market enters a new period for more M&A in the next five years
Chinese article by 爱集微
English Editor 张未名
07-18 18:32

By Li Panpan

The investment panel at the 6th JWSS (JiWei Semiconductor Summit) in Xiamen of southeastern China’s Fujian Province appraised the role of the STAR Market of the Shanghai Stock Exchange on the eve of its third anniversary, citing its more value for mergers and acquisitions that are expected to take place in next five years in China’s semiconductor industry, JW Insights reported.  

The panel was held on July 16, themed “The Third Anniversary of the STAR Market of Shanghai Stock Exchange: Capital boosts chip development.” 

Sun Jian, managing partner of Stony Creek Capital(石溪资本), chaired the panel, and panelists included Chen Datong, managing partner of Oriza Holdings(元禾璞华), Sun Changxu, managing partner of Xiaomi Industry Investment(小米产投), Zhao Sen, founding partner of China Fortune-Tech Capital(中芯聚源), and Zhou Ning, general manager of Infotech Ventures(盈富泰克). 

Chen Datong said that what China needs most in the semiconductor industry is an innovation system that can ensure long-term success, not individuals. “The most important role of the STAR Market is to have shown that China has always insisted on developing high-tech science and innovation, ensuring the smooth channels for companies to go public and bringing about healthy competition,” added Chen.

Chen also noted that the overall valuation of Chinese semiconductor companies is now declining, which is an opportunity for mergers and acquisitions; It is expected more to happen next year.

Sun Changxu said that the STAR Market promoted the development of listed chip companies in the secondary market and chip startups in the primary market because capital tends to invest in first-tier startups with better valuation by the STAR Market. 

More investment opportunities will occur with revolutionary changes. Smart electric vehicles and new energy are undergoing revolutionary changes with emerging technologies and broad prospects. “Our investments are around technology areas where big changes are taking place,” she added. 

Zhao Sen said the STAR Market is a system innovation, and IC is a technological innovation area. Great growth in the IC industry in the past three years indicates they are indispensable. 

The IC industry will enter the stage of quantitative change to qualitative change. “We will work with industry leaders to enhance their strength, and engage in the industry to create new leaders,” added Zhao. 

Zhou Ning pointed out that the STAR Market provides a good exit channel. And his company has benefited a lot from investing in early-stage technology companies. 

The IC industry needs to be empowered by the downstream market. Zhou said, China’s IC industry has become relatively stable in the global market compared with ten years ago, though facing many difficulties now.

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