CXMT priced shares at 8.66 yuan and watched them jump 500% because nothing says rational market behavior like a memory chip company quintupling on day one. The Hefei-based firm now enjoys a valuation based entirely on vibes and the collective amnesia of investors who forgot what happened to every other semiconductor IPO that opened like a SpaceX launch.
Retail traders saw the 500% pop and immediately began googling "how to buy Chinese IPOs" and "what does CXMT stand for" in that order. They raised $8.6 billion dollars. That's enough money to fund a small nation's infrastructure or, in this case, enough to make sure thousands of people who bought at the peak can tell their grandchildren about the time they learned what lock-up periods are.
The Shanghai debut went so well that analysts are now required by law to call it "blockbuster" despite the fact that Blockbuster also had a great opening before it became a punchline. Memory chips are a commodity business with razor-thin margins and cyclical demand, which makes this the perfect investment for people who think technical analysis is when you zoom in really close on a candle chart and pretend you see a pattern.
CXMT executives are probably thrilled. They got to ring a bell, take photos, and dump $8.6 billion of future bagholders' money into a sector where the difference between success and bankruptcy is whether Taiwan has a good quarter. The company makes memory chips, which means they make the same thing as six other companies except with more Chinese characteristics and less access to ASML's best machines.
Every moron who bought at 500% up will spend the next year explaining to themselves why holding for the long term was always the plan.
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