SINGAPORE/SHANGHAI: Chinese chipmaker CXMT vaulted to the top of China's stock market by valuation on July 27 after its shares surged 466 percent in their Shanghai trading debut, marking one of the strongest first-day performances ever for a major Chinese listing and underscoring investor enthusiasm for the country's semiconductor sector.

The rally followed Asia's biggest initial public offering this year and came despite a recent selloff in global technology stocks. According to Dealogic data, the one-day gain was the largest among the world's 10 biggest IPOs this year by deal value and the biggest ever recorded for a Chinese listing worth US$5 billion or more since 2006.

CXMT's shares closed at 49 yuan, up from the IPO price of 8.66 yuan, after reaching an intraday high of 55.03 yuan. The surge lifted the company's market capitalization to 3.3 trillion yuan ($487.73 billion), compared with about $85.5 billion during the IPO process.

The debut also made CXMT China's most valuable listed company, overtaking banking giant Industrial and Commercial Bank of China. Its first-day performance far exceeded that of China Resources New Energy, whose shares more than doubled following a $3.6 billion IPO earlier this month.

As U.S. export restrictions intensify competition in the global semiconductor industry, CXMT has become a central part of Beijing's efforts to build a self-sufficient chip industry and strengthen capabilities in strategic technologies such as artificial intelligence.

The company's strong market debut highlighted investors' willingness to pay a premium for a leading Chinese chipmaker even as broader markets grapple with volatility following an AI-led technology selloff.

About 141.1 billion yuan worth of CXMT shares changed hands on July 27, making it the first A-share stock to record more than 100 billion yuan in daily turnover, according to local media reports.

Chinese chipmaking stocks slipped 0.4 percent, while semiconductor firms gained 0.8 percent as fund managers adjusted their portfolios to accommodate the new listing.

"Investor appetite is largely being driven by providing Chinese investors a way to meaningfully get exposure to the current memory supercycle," said Jing Jie Yu, equity analyst at Morningstar.

Yu said the IPO had been priced at a steep discount, at roughly one times Morningstar's estimated 2027 price-to-book value compared with 2.1 to 2.3 times for global peers. However, he said the stock's sharp first-day rally appeared excessive, citing the cyclical nature of the memory chip market and the longer-term impact of U.S. export controls limiting access to advanced chipmaking technology.

The stock's rapid rise, which values CXMT at nearly half the size of U.S. memory chipmaker Micron, has also raised concerns that investor optimism may have gone too far.

"The (CXMT) stock is too expensive and smells of speculation," said Yuan Yuwei, hedge fund manager at Trinity Synergy Investments, adding that "it's hard to say the optimism is sustainable."

CXMT, formerly known as ChangXin Memory Technologies, raised 57.92 billion yuan ($8.6 billion) in the IPO, the largest mainland Chinese semiconductor offering on record. The company expects first-half revenue to increase more than sevenfold to between 110 billion yuan and 120 billion yuan and forecasts net profit of 66 billion yuan to 75 billion yuan, reversing a loss a year earlier.