This article first appeared on GuruFocus.
Moore Threads surged 425% in its first day of trading, positioning the company as a potential homegrown challenger to Nvidia (NASDAQ: NVDA ) as investors’ attention is quickly shifting to China’s semiconductor sector. The debut has become a signaling moment for China’s broader goal of becoming technologically self-sufficient, and retail enthusiasm is fueling that narrative. New stock listings performed well this year. Regulators deliberately slowed down IPO approvals to ensure market liquidity, while weak secondary market sentiment drove more capital flows to new stock issuances. Moore Threads’ pre-deal retail oversubscription of about 2,750 times also suggests demand may be far from cooling.
This context may explain why MetaX Integrated Circuits and Beijing-based Onmicro are now experiencing subscription levels akin to full-scale panic buying. MetaX’s retail quota was oversubscribed 2,986 times, while Beijing Onmicro’s was 2,899 times oversubscribed, according to Friday’s filing. It is rare for retail bidding power to reach such a scale: MetaX priced at 104.66 yuan per share, attracting a demand of about 3 trillion yuan; Beijing Angwei priced at 83.06 yuan per share, attracting a demand of about 1.4 trillion yuan. Millions of investors flock to these IPOs because the process is almost like a lottery, requiring no upfront money and offering the potential for rapid upside with minimal perceived risk. Bloomberg calculated oversubscription rates using online winning rates disclosed in company filings.
Founded in 2020, MetaX plans to raise $585.8 million in its upcoming debut in Shanghai and operates in a GPU manufacturing space similar to Moore Threads. Based on its offering price, MetaX trades at a price-to-sales ratio of 56.4 times, compared with an average price-to-sales ratio of 127.4 times for its peers in 2024, according to the filing. For investors, the current wave may be the early stages of a longer capital formation cycle for China’s semiconductor stack, and domestic GPU platforms may gain new visibility. As more listed companies emerge, the market will likely continue to view China’s chip IPOs as a window into the country’s ambitions to develop competitive chips and maintain strategic independence, while offering retail investors a lottery-like way to participate in the rally.