China

SMIC prepares large listing in Shanghai

Summary

China’s chipmaker SMIC surges over 200% in Shanghai market debut Description video: As China’s largest chip manufacturer, Semiconductor Manufacturing International Corporation’s (SMIC) debut performance is significant for the country’s ambitions to strengthen its domestic semiconductor industry amid trade tensions with […]

China’s chipmaker SMIC surges over 200% in Shanghai market debut

Description video:
As China’s largest chip manufacturer, Semiconductor Manufacturing International Corporation’s (SMIC) debut performance is significant for the country’s ambitions to strengthen its domestic semiconductor industry amid trade tensions with the U.S. CNBC’s Arjun Kharpal reports.

SMIC prepares large listing in Shanghai

China’s largest contract chip maker Semiconductor Manufacturing International Corporation (SMIC) has applied for a listing in Shanghai, which will raise 20 billion yuan ($ 2.8 billion).

SMIC prepares large listing in Shanghai

The move comes as the company seeks to increase investment in its technology amid escalating trade tensions between the US and China. Consequences could force SMIC to expand production.

The company received $ 2.2 billion from government investors last month.

SMIC is at the forefront of China’s plans for self-sustaining semiconductor manufacturing. In this segment, the Celestial Empire is well behind the success of the United States. However, Washington’s move to limit chip supplies could push China to take more drastic measures..

Huawei was one of the Chinese companies targeted by US sanctions. She was blacklisted by the US last year called The Entity List, which limited her access to the American technology market. In May administration Donald Trump introduced a rule that requires foreign manufacturers using US semiconductor equipment to obtain a license before trading with Huawei.

This rule is likely to affect Taiwanese TSMC, which produces most of the chips for smartphones and other Huawei products. If the Chinese giant cannot receive products from the Taiwanese corporation, it will have to look for alternatives in the domestic market, such as, for example, SMIC.. According to experts, SMIC technology lags far behind TSMC.

Thus, the recent financial injections could be an incentive for the company, as it will receive all the tools to quickly expand its capabilities..

SMIC indicated in its listing prospectus that trade friction between the U.S. and China, as well as Washington’s semiconductor regulations, could have a positive impact on the company’s business..