The earlier announced CNY 13.75 million (USD 1.94 million) round of strategic investment in RSIC (Raintree Scientific Instruments Corporation, 上海睿励) made AMEC (中微公司, 688012:SH) took off on the Shanghai Stock Exchange Star Market. Adding another CNY 2.3 billion (CNY 325.11 million) this morning, the chipmaker's market capitalization has reached CNY 44.89 billion (USD 6.35 billion).
Headquartered in Shanghai, RSIC manufactures and markets testing equipment for integrated circuits. AMEC (Advanced Micro-Fabrication Equipment Inc.) is an upstream peer of RSIC that built its business around semiconductor device fabrication. A small-sized chipmaker, it generated CNY 1.64 billion (USD 231.75 million) in revenue last year.
AMEC, which once set an IPO price at over 175 times earnings (now the P/E ratio is twice as high as this number), has been lately performing well on the Star board, along with other semiconductor companies therein. Meanwhile, the company was said to earn its first Triple Crown win in the 2019 Customer Satisfaction Survey (CSS) a few weeks ago.
Hardware portal MaschinenMarkt International reported in January 2019 that China represents more than 40% of the global chip market, which amounted to USD 450 billion in 2018. Later on, Nikkei published an industry group forecast projecting the sector to shrink 12% in 2019 to USD 412 billion. This decline, according to the group, will be mostly related to the unflagging trade and technological tensions between the U.S. and China.