Changxin Effect: The "Circle of Friends" of China's "Hynix"
During the current semiconductor boom cycle, Changxin Technology Group Co., Ltd. (hereinafter referred to as "Changxin Technology") is one of the largest domestic DRAM (Dynamic Random Access Memory) capacity expansion entities.
On May 17th, the updated prospectus for Changxin Technology's IPO on the Science and Technology Innovation Board showed that in the first quarter of 2026, the company achieved a revenue of 50.8 billion yuan and a net profit attributable to the parent company of 24.76 billion yuan. It is also expected that the net profit attributable to the parent company in the first half of 2026 will be between 50 billion and 57 billion yuan.
For comparison, in the first quarter of 2026, SK Hynix (000660.KS) had a revenue equivalent to approximately 270 billion yuan in RMB, and Samsung Electronics (005930.KS)'s memory chip business revenue was equivalent to about 380 billion yuan in RMB. That is to say, Changxin Technology's quarterly revenue of 50.8 billion yuan is already about one - fifth of SK Hynix's in the same period.
In terms of business structure, Changxin Technology and SK Hynix have obvious similarities. Both are IDM manufacturers (Integrated Device Manufacturers, which integrate chip design, wafer manufacturing, packaging, and testing) with DRAM as the core. The difference is that about 30% of SK Hynix's revenue comes from NAND flash memory (non - volatile memory chips), while Changxin Technology is currently a pure DRAM company.
Or rather, to some extent, Changxin Technology is becoming the Chinese "Hynix".
The global memory industry has been dominated by Samsung, SK Hynix, and Micron Technology (MU.NASDAQ) for more than a decade. Changxin Technology is the new entrant that has come closest to the top of the industry in the past decade.
The manufacturing process of a DRAM chip is quite complex. From a silicon wafer to a finished product, it has to go through hundreds of processes such as etching, thin - film deposition, chemical mechanical polishing, cleaning, and testing. Each process corresponds to a type of specialized equipment and a batch of specific materials.
From the information in the prospectus, Changxin Technology was able to complete the comprehensive product switch from DDR4 (Fourth - Generation Double Data Rate Memory) to DDR5 (Fifth - Generation), increase the gross profit margin from - 112% two years ago to over 40%, and rapidly expand its revenue. The premise is that its underlying supply chain can provide synchronous support.
Jiang Bin, an engineer with many years of experience in the semiconductor equipment industry, told a reporter from Economic Observer that in the past, the biggest problem for domestic equipment was the lack of opportunities for verification on mass - production lines. The large - scale capacity expansion of Changxin Technology and YMTC is providing such opportunities for domestic equipment manufacturers.
The Equipment Suppliers Behind the Processes
The main process of manufacturing a DRAM chip can be simplified as follows: repeatedly deposit thin films on a silicon wafer, define the circuit pattern through photolithography, remove the excess parts through etching, use chemical mechanical polishing (CMP) to flatten the surface, and then perform ion implantation, cleaning, and testing.
The entire process involves hundreds of processes, each of which requires specialized equipment.
An investor who has long been concerned about semiconductor equipment told a reporter from Economic Observer that in the equipment capital expenditure of a DRAM production line, etching and thin - film deposition equipment together account for about 50%, the largest share. Next comes photolithography equipment, followed by metrology and testing equipment (equipment used for precise measurement and inspection of thin - film thickness, line width, defects, etc. on chips). Metrology and testing account for about 12% to 15% of the total equipment expenditure. These equipment have long relied on imports in the past.
Although American and Japanese manufacturers such as Applied Materials, Lam Research, and Tokyo Electron (TEL) still occupy the main share of the global semiconductor equipment market, in the past few years, the penetration rate of domestic equipment on domestic memory production lines has been rapidly increasing.
A person in the industrial chain close to Changxin Technology told a reporter from Economic Observer that the overall proportion of domestic equipment at Changxin Technology currently ranges from 40% to 50%. According to public information, the situation of Yangtze Memory Technologies Co., Ltd. (hereinafter referred to as "YMTC") can also serve as a reference: in its Wuhan Phase III factory, the procurement proportion of domestic equipment has exceeded half, and the localization rate of core processes such as etching, thin - film deposition, cleaning, and testing has even exceeded 60%.
This person in the industrial chain said that such a localization rate is quite high in the industry, and the proportion of domestic equipment in most domestic wafer fabs is lower than this level.
However, the proportion of domestic equipment at Changxin Technology and YMTC is not evenly distributed across all production links. The aforementioned investor told the reporter that the localization rate of CMP and cleaning equipment is already relatively high, and the etching and thin - film deposition equipment are also in the stage of rapid penetration, but the localization rate in metrology and testing, photoresist coating and development, and other links is still relatively low, with the greatest potential for improvement.
Among various types of equipment, the usage and amount of etching equipment account for a relatively large proportion. The working principle of etching is to use plasma or chemical gases to "carve" the trenches and lines required for the circuit on the chip. The deeper and narrower the trenches, the higher the technical difficulty. The industry uses the "aspect ratio" to measure this indicator - the larger the aspect ratio, the stronger the equipment's precision and control ability.
Northern Microelectronics (002371.SZ) is currently one of the domestic semiconductor equipment companies with the most comprehensive product coverage, spanning multiple links such as etching, thin - film deposition, heat treatment, wet cleaning, and ion implantation. Its financial report shows that in 2025, the revenue from its etching equipment and thin - film deposition equipment both exceeded 10 billion yuan. In the same year, the delivery volume of its vertical furnaces and PVD equipment (PVD, i.e., Physical Vapor Deposition, used for plating metal thin films on chips) both exceeded 1,000 units.
At the performance briefing on May 15th, Zhao Jinrong, the chairman of Northern Microelectronics, responding to investors' questions about the localization rate, said that the overall localization rate of equipment for newly built wafer production lines across the country is continuously increasing, and the localization of various types of production lines, including logic chips (processors such as CPU, GPU), memory chips, power semiconductors (chips used for power conversion and management), and specialty processes, is accelerating.
Micro Technology (688012.SH) is another major domestic etching equipment manufacturer. According to the company's first - quarter report in 2026, more than 300 reactors (the core units in etching equipment that actually perform the etching process) of its independently developed ultra - high aspect ratio etching machines have achieved mass production on memory production lines. The next - generation 90:1 ultra - high aspect ratio low - temperature etching equipment has also been sent to customers for verification, and the second - generation ICP (Inductively Coupled Plasma) etching equipment has achieved an etching result of 140:1 in 3D DRAM applications.
What does 90:1 and 140:1 mean? The reporter learned in interviews that when carving a trench on a silicon wafer, the width of the trench is less than one - ten - thousandth of the diameter of a hair, while the depth is 90 times or even 140 times the width. This places extremely high requirements on the precision and stability of the equipment - if the trench is not deep enough, the circuit structure will be incomplete; if it is etched off by even a few nanometers, the entire wafer may be scrapped.
Every time the DRAM chip is upgraded, the structure of the capacitor has to be made deeper, and the requirement for the aspect ratio of the etching equipment also increases accordingly. The aforementioned investor told the reporter that being able to achieve an aspect ratio of 140:1 means that the equipment can already support the manufacturing requirements of the latest generation of DRAM.
In addition to etching equipment, the localization rate of thin - film deposition equipment is also increasing relatively rapidly.
Thin - film deposition equipment is responsible for "growing" functional thin films layer by layer on the silicon wafer. In the DRAM manufacturing process, the capacitor is the core structure for storing data. The two key thin films in the capacitor, the electrode material layer and the high - dielectric - constant dielectric layer, need to be prepared using atomic layer deposition (ALD) equipment.
The characteristic of ALD is that it deposits layer by layer in units of single - atom thickness, with extremely high precision.
Topco Science & Technology (688072.SH) is a major domestic thin - film deposition equipment manufacturer. The financial report shows that in the first quarter of 2026, the company achieved a revenue of 1.112 billion yuan, a year - on - year increase of 57%, and a net profit attributable to the parent company of 571 million yuan, turning from loss to profit year - on - year. In 2025, the revenue from its PECVD (Plasma - Enhanced Chemical Vapor Deposition, a process for depositing dielectric thin films on chips) equipment was 5.142 billion yuan, a year - on - year increase of 75%; the revenue from ALD equipment was 301 million yuan, a year - on - year increase of 192%. As of the end of 2025, Topco Science & Technology had cumulatively shipped more than 3,400 reaction chambers, entering about 100 chip production lines.
Public information shows that in September 2025, the third phase of the National Integrated Circuit Industry Investment Fund made its first industrial investment project since its establishment in Topco Key Technology, a subsidiary of Topco Science & Technology, which focuses on the research and development of advanced bonding equipment.
In addition to etching and thin - film deposition, chemical mechanical polishing (CMP) and testing are also indispensable links in DRAM manufacturing. Among them, the function of CMP is to polish the wafer surface to nanoscale flatness after each layer of circuit is completed. If the surface is not flat enough, the subsequent photolithography and deposition processes cannot be carried out accurately.
According to an announcement from Huahai Qingke (688120.SH), in April 2026, the company's 1,000th CMP equipment was shipped. Huahai Qingke said at its 2025 annual performance briefing that the company's CMP equipment has been widely used in mainstream process platforms such as logic chips, 3D NAND, and DRAM. Its coverage rate and market share in domestic 12 - inch advanced production lines are continuously increasing, accounting for more than 90% of the sales of domestic CMP equipment.
The changes in the testing link are also worth noting. Testing is the last checkpoint before the chips leave the factory. Every DRAM chip has to complete a full - function verification on the tester, and unqualified ones are directly rejected. The speed of the tester determines whether it can complete the signal transmission, reception, and comparison at the actual operating frequency of the chip.
Currently, the data transfer rate of DDR5 memory has reached the level of billions of bits per second. The speed of the tester must match or even exceed this level; otherwise, it cannot accurately detect defects.
In January 2026, Jingzhida (688627.SH) signed a semiconductor testing equipment contract worth 1.311 billion yuan, covering the full - process testing of DRAM and HBM (High - Bandwidth Memory). The self - developed high - speed FT (Final Test) tester of Jingzhida has a speed of 9 billion bits per second, exceeding the 8 billion bits per second level of the main models of Advantest, one of the world's largest semiconductor testing equipment manufacturers.
According to Jingzhida's annual report, in 2025, the revenue from its semiconductor testing equipment increased by more than 150% year - on - year, replacing display inspection as the company's largest business.
The aforementioned investor told the reporter that Changxin Technology launched a new round of equipment bidding in the second quarter of 2026 and plans to expand its production capacity by about 50,000 to 60,000 wafers this year. The corresponding equipment procurement demand may be between 35 billion and 43 billion yuan. In addition, in the IPO fundraising projects disclosed in Changxin Technology's prospectus, the total cost of equipment purchase and installation is 22.066 billion yuan. There is also public information showing that the tender for the process equipment purchase and installation project of YMTC's No. 2 factory building was also launched in May.
Currently, the two domestic memory giants have entered a period of intensive equipment procurement simultaneously. For domestic semiconductor equipment manufacturers, the good times may have just begun.
From Precursors to Polishing Fluids
Equipment requires a one - time investment and can operate for many years after entering the production line. However, materials are different. Each chip wafer continuously consumes various raw materials such as chemicals, gases, photoresists, and targets during the manufacturing process. The larger the production capacity, the more the consumption.
A securities analyst who has long been concerned about the memory industry chain told a reporter from Economic Observer that in the investment transmission around memory capacity expansion, equipment usually comes first, followed by materials. After the production capacity is established, the consumption of consumables increases significantly.
Changxin Technology fully disclosed its raw material procurement situation in the prospectus: in 2025, the total raw material procurement was about 11.47 billion yuan. By category, chemicals (used for cleaning and wet processes) accounted for the largest proportion, at 37.29%; photoresists (photosensitive materials for defining circuit patterns in the photolithography process) accounted for 12.16%; silicon wafers (base materials for chip manufacturing) accounted for 8.55%; electronic specialty gases (high - purity gases used in etching and deposition processes) accounted for 5.10%; targets (high - purity metal materials used in physical vapor deposition processes) accounted for 2.21%.
Among these materials, precursors are one of the special chemicals with the largest usage on the DRAM production line. Precursors are chemical raw materials used in the thin - film deposition process. In ALD and CVD (Chemical Vapor Deposition) equipment, precursors are heated and decomposed to form the required thin films on the chip surface. The manufacturing of capacitors in DRAM chips largely depends on precursors, and every time the process is upgraded, the number of layers and types of thin films increase, and the usage of precursors also rises accordingly.
Jacques Science & Technology (002409.SZ) is one of the largest companies in the field of domestic semiconductor precursor materials. Its products cover multiple categories such as high - dielectric - constant materials (a special medium used for manufacturing the insulating layer of capacitors; the higher the dielectric constant, the more charge the capacitor can store in a smaller area), silicon - based materials, and metal materials.
In 2025, Jacques Science & Technology had a revenue of 8.611 billion yuan, a year - on - year increase of 25.49%. According to publicly disclosed information from Jacques Science & Technology, the localization project of precursors in its Jiangsu factory has products that have passed customer verification and are being transferred to batch trial production.
CMP (Chemical Mechanical Polishing) is a key process for achieving wafer surface planarization in chip manufacturing. After each layer of circuit is completed, the wafer surface becomes uneven. The principle of CMP is to use a rotating polishing pad in combination with a polishing fluid, and at the same time use both chemical corrosion and mechanical grinding to polish the surface to nanoscale flatness. If the wafer surface is not flat enough, the photolithography of the next layer of circuit will be misaligned, and the yield rate of the entire wafer will be affected. The number of CMP operations is equal to the number of circuit layers, and the polishing fluid is the main consumable in this process.
Anji Technology (688019.SH) is the leading domestic enterprise in CMP polishing fluids. In the first quarter of 2026, Anji Technology had a revenue of 724 million yuan, a year - on - year increase of 32.76%, setting a new single - quarter high. According to Anji Technology's statement in its first - quarter report, several types of its tungsten polishing fluids have passed verification in advanced memory chip processes and are continuously increasing in usage.
Wafer manufacturing also requires a large amount of high - purity specialty gases. For example, the etching process uses fluorine - containing gases such as tungsten hexafluoride and nitrogen trifluoride, the thin - film deposition process uses reactive gases such as silane and ammonia, and the cleaning process requires high - purity nitrogen and argon. These gases have extremely high purity requirements, usually above 99.999% (referred to as "five nines" in the industry). Any trace impurities may cause chip defects.
Due to the large usage and strict purity requirements, wafer fabs usually do not purchase bottled gases externally. Instead, professional suppliers build gas - making stations directly in the factory area to produce on - site and deliver through pipelines.
Electronic specialty gases can be divided into two categories according to the supply method. One is bottled specialty gases, such as high - purity tungsten hexafluoride, nitrogen trifluoride, and silane