Chinese startup Enflame, which develops chips for artificial intelligence, demonstrated an impressive start on the stock market in Shanghai, soaring over 200% on its first trading day. The starting price of the shares was 142.18 yuan, and opening at 410 yuan, the company achieved a growth of 188%. During trading, the share price rose to 475 yuan, representing an increase of 234% compared to the initial price. This event concludes the debut cycle of four leading Chinese startups in the AI chip sector.
Enflame, actively supported by Tencent, represents a Chinese alternative to Nvidia chips. Currently, the company is not profitable, but revenue is expected to reach 990 million yuan (approximately 147 million dollars) in 2025, which is 37% more than the previous year when revenue was 722 million yuan. The funds raised will be used for the development of fifth and sixth generation chips, which are expected to compete with high-quality products from international competitors. Goldman Sachs predicts that semiconductor spending in China will reach 82 billion dollars by 2030.
The market for most AI accelerators in China is still dominated by international manufacturers, led by Nvidia, which is expected to hold nearly 60% of the market by 2025, according to IDC data. However, U.S. export restrictions on Nvidia products create opportunities for Chinese companies. For example, Z.ai successfully utilizes fully Chinese chips to run its GLM-5.3-Flash model. Analysts believe that the company has used a mix of Huawei processors and components from Enflame and other local suppliers.