Hefei, the fourth largest city by market capitalization on China's A-share market

Yesterday, Changxin Technology, headquartered in Hefei, officially listed on the Sci-Tech Innovation Board of the Shanghai Stock Exchange. By the close of trading in the afternoon, its market value exceeded 3.27 trillion yuan, directly taking the top spot as the largest A-share market capitalization, surpassing the Industrial and Commercial Bank of China, equivalent to two times that of Moutai, and even overtaking Tencent at one point.

As a result, the total market value of Hefei's A-share listed companies surged from approximately 1.5 trillion yuan to around 4.8 trillion yuan, overtaking Suzhou, Hangzhou, and Nanjing in one go to rank as the second city in the Yangtze River Delta region.

Nationwide, it ranks only behind Beijing, Shenzhen, and Shanghai, earning the title of the fourth-ranked city by A-share market capitalization.

Some estimates show that based on the 3.27 trillion yuan market value, the market value of shares held by Hefei's state-owned assets exceeds 1 trillion yuan — what does this figure represent?

In recent years, Hefei's annual land transfer revenue has been roughly between 30 billion and 50 billion yuan. This means the 1 trillion yuan market value of Hefei's state-owned equity holdings is equivalent to 20 years of land sales revenue for the city.

Some analyses point out that Hefei has fired the first shot in the transition from "land finance" to "equity finance".

The listing of Changxin Technology has reshaped the market value landscape of A-share listed companies in the Yangtze River Delta and even across mainland China.

The total market value of Hefei's A-share listed companies has surged from about 1.5 trillion yuan to approximately 4.8 trillion yuan, overtaking Suzhou, Hangzhou, and Nanjing, and ranking only behind Beijing, Shenzhen, and Shanghai, making it the fourth city by A-share market capitalization in mainland China.

Currently, the total market value of A-share listed companies in Suzhou, Hangzhou, and Nanjing stands at roughly 4.4 trillion yuan, 3.4 trillion yuan, and 1.95 trillion yuan respectively.

The listing of Hefei Changxin Technology, which has become the largest company by A-share market capitalization, has once again drawn public attention to the well-known "Hefei Model".

Hefei is known as the "most remarkable venture capital city". By relying on state-owned assets to make upfront layouts in capital-intensive hard technology tracks, it has successively bet on BOE, NIO, and Changxin Technology, building a complete industrial system covering "chips, displays, automobiles, and integrated industries, as well as advanced manufacturing, life sciences, and intelligent technologies".

Different from short-term speculative follow-up investments, Hefei adheres to the philosophy of long-term industrial investment. Facing the downward cycle of the memory industry, even when Changxin had accumulated losses of over 36 billion yuan in previous years, Hefei's state-owned assets continued to provide financial support and stay the course, waiting for the industry cycle to reverse.

The current AI-driven memory super cycle has led to explosive growth in Changxin's performance. In the first quarter of 2026, its revenue and net profit surged several times year-on-year, with single-quarter profits offsetting the losses of the previous two years, bringing substantial book returns to Hefei's state-owned shareholders.

However, the Hefei Model is not a guaranteed profit. In the past, there were also large investment losses in fields such as photovoltaics and biomanufacturing. Moreover, many regions across the country are now blindly following suit to set up government industrial funds and make unplanned layouts in the chip and automobile manufacturing sectors, leading to operational difficulties for a large number of projects.

The Hefei municipal government has also made it clear that its local industrial layouts are pragmatic industrial investments rather than simple high-stakes gambles. Urban development cannot rely on a single investment miracle. The listing of Changxin is only a phased achievement, and challenges such as cyclical fluctuations in the memory industry and the market monopoly of global giants still exist.

When other regions learn from the Hefei Model, they should base their efforts on their own industrial foundations, and use long-term, patient capital to improve the supporting industrial chain, rather than simply replicating the path of state-owned assets betting on leading enterprises.

(Note: All content in this article is for communication and reference only and does not constitute any investment advice.)

This article is from the WeChat Official Account "City War", author: Xiaoyu, published with authorization from 36Kr.