China's Big Fund Trims Stakes in Local Chipmakers amid Semiconductor Frenzy

Technology Author: Dixuan Lu, Ivan Platonov Editor: Luke Sheehan Jul 12, 2020 05:50 PM (GMT+8)

GigaDevice and Goodix are on the sell list.

Image credit: GigaDevice official website

On July 9, the China National Integrated Circuit Industry Investment Fund (CICIIF or 'Big Fund') sold 2.36 million shares, or 0.5% of GigaDevice's total share capital, with the transaction volume reaching CNY 630 million. 

According to the short plan released on June 13, the Fund's current short quota of GigaDevice shares still leaves 2.35 million shares unused. Based on the current stock price estimate, it is expected that the subsequent amount of short selling will exceed CNY 600 million.

Apart from that, the Fund is planning to short another four stocks, including Shenzhen-based integrated circuit designer Goodix. If sold at the current prices of each of these shares, the total amount the Fund will receive could be over CNY 4.9 billion.

Though this reduction is normal practice, considering the recent overheating of the A-share market, the Big Fund's recent action might be purely event-driven.