Jukan
Semiconductor & AI Infrastructure Research at Citrini
Chinese semiconductor localization names like ACM Research and NAURA look like attractive opportunities for the second half of 2026 because CXMT's IPO should channel capital their way. Chinese sell-side analysts say CXMT's market cap right after listing could reach at least RMB 5 trillion, a frenzy Western investors underestimate, and most of the money it raises will likely flow into localization stocks. x.com
ACM Research is the simplest way to play the inevitable capacity ramp at Chinese memory makers CXMT and YMTC, because CXMT's capex is ACM's revenue. Bernstein believes CXMT is building an undisclosed Shanghai fab with up to 100k wafers a month of capacity, due to start production early next year, and models its capex rising 70% a year through 2028 to $35B. x.com x.com
ACM Research trades at a discount of more than 50% to the value of its China subsidiary, which is worth over twice the parent and has posted back-to-back gains above 15%. China's mainland market rally should eventually flow through to consumption. x.com
ACM Research carries binary China risk: China is about 97% of its business, and authorities could stop it any day, forcing management to choose between San Jose and China. The CCP's threats toward other countries make that exposure uglier, whatever the company's $4B revenue ambition. x.com x.com x.com
Chinese names like Alibaba and ACM Research have room to catch up while valuations elsewhere get absolutely out of hand. Per @negligible_cap, Cerebras is targeting up to $4B in its US IPO at a $40B valuation. The China catch-up trade is obvious, yet still non-consensus. x.com
ACM Research's discount to the value of its China-listed unit means nothing if management never acts to close it. That unit trades at roughly 70-80x in China, which looks a bit pricey, so fair value probably lies somewhere in between. x.com
ACM Research looks underpriced because its Chinese subsidiary alone has a backlog equal to about half the company's market cap. ACM Shanghai's backlog rose 88.2% to $2.5B, yet the stock barely reacted. x.com x.com
Alibaba's 5% stake in memory maker CXMT, bought for roughly $1B, is now about a 25x return after CXMT rose 4.6x over its IPO price on its first day, making it China's most valuable company at over 500B. CXMT's DDR5 pricing is level with, even slightly above, SK hynix and Samsung's. x.com
ACM Research should benefit as China's wafer fab equipment spending soars over the next couple of years across memory and leading-edge logic, more than offsetting lower mature-node spending. Its advanced packaging sales to non-Chinese clients are also growing well, and valuation looks reasonable after the recent pullback. x.com
ACM Research should benefit when its core customers CXMT and YMTC go public, because US investors will not be able to buy them and are likely to use ACM Research as a proxy. As the market starts pricing in who the real memory winners are, Micron looks set to lose out. x.com
ACM Research stands out among holding-company NAV discounts because its subsidiary is growing independently and an H-share subsidiary listing is coming soon, making it one of the biggest discounts with a path to unlock and a candidate for more concentration. Similar discounts at Korean holding companies such as Iljin Holdings and Simmtech Holdings look less trustworthy for a NAV unlock given governance. This is still early research, not a formal conclusion. x.com
