Chinese chipmaker Enflame 4,073 times oversubscribed in Shanghai IPO amid Nvidia race

Chinese AI chipmaker Enflame Technology witnessed an unprecedented retail frenzy during its IPO in Shanghai's tech-focused Star Market, with the offering being oversubscribed by a staggering 4,073 times. The retail portion saw a surge of about 7 million online investors submitting orders for a total of 42.1 billion shares, resulting in an allocation rate of just 0.025 per cent for individual investors. This remarkable demand indicates a growing appetite for home-grown alternatives to Nvidia in China.

Enflame Technology, one of China's leading AI chipmakers and dubbed one of the "four little dragons" in the sector, is set to raise 6.12 billion yuan to fund the development of its fifth and sixth-generation AI chips. The company's shares, priced at 142.18 yuan each, are expected to debut at a strong performance, potentially matching the first-day gains of 693 per cent and 425 per cent seen by its competitors, MetaX and Moore Threads, respectively.

Tencent Holdings, the parent company of Enflame, led the retail investor rush, securing a 4.06 per cent stake through a subsidiary with a 36-month lock-up. Other notable investors included memory chipmaker GigaDevice, tech giant Xiaomi, chip packaging and testing company Tongfu Microelectronics, and telecommunications leader ZTE. With such a high demand and a low allocation rate, securing Enflame shares appears to be a challenging task for most retail investors.