CXMT Almost Ready to Produce LPDDR6, SK Hynix Can Get New Opponents

Illustration of a memory chip. CXMT is said to be closer to mass producing LPDDR6, a new generation of faster and power-efficient DRAM chips. Photo illustration: Pexels.

ChangXin Memory Technologies or CXMT is getting closer to mass production of LPDDR6 memory chips. If it can start production before the end of the year, the Chinese company has the opportunity to enter the early ranks of new generation DRAM makers.

Yicai Global, quoted on Monday, August 3, reported that the LPDDR6 developed by CXMT was almost completing the testing phase. This information was conveyed by someone who knew the issue.

CXMT is based in Hefei, China. The company became the most valuable listed company in mainland China after listing on the stock exchange last week.

LPDDR6 is the sixth generation of low-power dynamic random-access memory or DRAM. This chip is designed to work faster and use more power.

LPDDR is widely used in consumer electronic devices, including mobile phones and tablets.

Yicai sources said that if CXMT can mass produce LPDDR6 before the end of this year, the company will be one of the first in the world to make the new generation of DRAM.

The move could also put CXMT in direct confrontation with SK Hynix, the South Korean memory giant.

In March, SK Hynix announced that it had become the world's first company to complete testing of a 16 gigabyte LPDDR6 product.

SK Hynix also stated that it plans to complete preparations for mass production in the first half of this year and begin supplying customers in the second half.

Compared to the current LPDDR5X products, the new chip offers a third higher bandwidth and lower power consumption by more than 20 percent.

Bandwidth is the capacity of data flow. The larger the bandwidth, the more data that can be processed at the same time.

Two other memory giants, Samsung Electronics and Micron Technology, have not publicly disclosed the development of their LPDDR6 mass production schedules or schedules.

CXMT has so far mainly produced fifth-generation double-rate synchronous DRAM and LPDDR5. Revenue from LPDDR products accounted for more than 66 percent of the company's total revenue last year.

Yicai Global noted that CXMT shares with the code 688825 in Shanghai closed up 1.9 percent to 54.99 yuan or 8.15 US dollars per share. The increase came as the benchmark Star Composite index fell 3.4 percent.

CXMT listed on the Shanghai Star Market on July 27. Star Market is a Nasdaq-style exchange board that hosts many technology companies.

With a market capitalization of 3.61 trillion yuan, CXMT's value is about a third higher than Industrial and Commercial Bank of China or ICBC, which is worth 2.72 trillion yuan. ICBC was previously the market leader.

According to its prospectus, CXMT began mass producing LPDDR5 in 2023, DDR5 in 2024, and LPDDR5X last year.

CXMT sold 6.688 billion shares in an initial public offering or IPO at a price of 8.66 yuan or 1.29 US dollars per share.

Gross proceeds before the greenshoe option amounted to 57.9 billion yuan or 8.6 billion US dollars. The greenshoe option is an additional stock allocation option to maintain price stability after the IPO.

The IPO value surpassed the 53.2 billion yuan achieved by Semiconductor Manufacturing International Corporation or SMIC in an IPO on the Star Market in 2020.

With this achievement, CXMT's IPO became the largest share offering in mainland China in almost 19 years and the largest in Asia this year.

CXMT said the proceeds from the IPO will mainly be used to increase the production line of memory wafer fabrication, develop DRAM technology, and conduct the next stage of DRAM research and development.