Let’s first talk about the market.
In the past, the A-shares were dominated by the “Big Four Banks,” but now it has transformed into a stronghold of technology stocks, and they are clinging together even more tightly than the Big Four.
I remember mentioning last year that “the US stock market has the Seven Sisters, and the domestic market will also have its Seven Sisters.” Now, stocks like Cambricon, SMIC, Yi Zhongtian, Shenghong Technology, and Industrial Fulian have become the new sisters.
However, the extreme clinging together has increasingly negative effects, as it drains liquidity from other stocks. Even with a trading volume of 3 trillion today, over 2000 stocks actually fell! This is the challenging aspect of the A-share market: in a bear market, everyone loses together, while in a bull market, only a few profit.
Therefore, tonight, the management’s attitude towards cooling down technology stocks on the Sci-Tech Innovation Board is very clear, and technology stocks have received a series of negative news:
1. Tonight, Dongxin Co. was put into a special trading suspension, marking the first tech stock suspension this year;
2. The new stock king Cambricon disclosed its annual revenue performance six months in advance (which is somewhat negative);
3. SMIC disclosed its semi-annual report (which was standard), while Hua Hong’s net profit for the first half of the year fell by 72%;
4. Zhongwei Company, Tuojing Technology, and Aojie Technology successively announced share reductions;
This series of punches will likely lead to more challenges for AI, technology stocks, and the Sci-Tech Innovation Board tomorrow, at least in the morning, it will be quite delicate, but it may rebound in the afternoon.
The post written on the Star Planet last night predicted today’s market trend correctly; I wonder if it can predict tomorrow’s?
Tonight, let’s focus on storage power (data storage).
Recently, AI, technology stocks, and the Sci-Tech Innovation Board have become the focus of the A-share market. The AI computing sector, including CPO, PCB, servers, GPUs, and liquid cooling concepts, has seen astonishing gains, but the “twin brother” of computing power, storage power (data storage capacity), remains undervalued. With the acceleration of AI applications and the reversal of the storage industry cycle, the storage chip sector related to storage power is expected to welcome recovery opportunities.
Recovery Logic: Revaluation of Storage Power and Storage Chips
(1) The underlying logic of the coordinated development of computing power and storage power
AI large model training and inference impose higher requirements on data storage. Taking GPT-4 as an example, its parameter count exceeds 1.8 trillion, and the training process requires processing EB-level data, making high-bandwidth memory (HBM) and solid-state drives (SSD) essential. The storage value of a single AI server can reach $10,000, more than double that of a regular server. Currently, the computing power sector has fully reflected expectations, while storage power, as the “infrastructure” of computing power, has not yet been fully recognized by the market.
(2) Key nodes in the reversal of the storage industry cycle
Storage chip prices have gradually rebounded since hitting bottom in the third quarter of 2023. By the fourth quarter of 2024, the global DRAM market size is expected to grow by 63.8% year-on-year, and NAND Flash by 42.4%. Although demand in the consumer market (mobile phones, PCs) is weak, enterprise-level storage (data centers, AI servers) demand is strong, driving an average price increase of 15%. Leading manufacturers like SK Hynix have seen HBM sales account for over 40% of total DRAM revenue and plan to double this by 2025. The industry’s inventory adjustment is nearing completion, with Samsung and Micron already initiating production cuts, and the supply-demand pattern continues to improve.
(3) Dual drivers of policy support and domestic substitution
The National Big Fund’s third phase has listed storage chips as a key investment area, particularly focusing on high-end products like HBM and DDR5. Domestic manufacturers such as Changxin Storage and Yangtze Memory Technologies are accelerating technological breakthroughs: Changxin Storage’s DDR5 yield rate has reached 80%, and HBM2 has entered the customer sampling stage, with mass production expected by mid-2025; Yangtze Memory’s 294-layer 3D NAND flash has achieved commercial use, and its hybrid bonding technology has been adopted by Samsung. The domestic substitution process is accelerating, and it is expected that by 2025, the domestic storage chip market share will exceed 10%.
(4) The resonance effect of technological iteration and AI demand
AI edge applications (such as AI smartphones and PCs) are driving upgrades in storage technology. The DRAM configuration for AI smartphones has increased to 16GB, and the memory capacity for AI PCs generally reaches 32GB, requiring faster read and write speeds (such as LPDDR5X). Additionally, integrated storage and computing technologies (such as near-memory computing) enhance efficiency through 2.5D/3D packaging, further driving demand for high-end storage like HBM and eSSD.
Stock Analysis: Core Potential Targets for Storage Power and Storage Chips (excluding stocks with significant gains: such as Dongxin Co.)
1.GigaDevice (603986): Dual-Driven by Storage and MCU
The company is a leading domestic storage chip manufacturer, with the second-largest global market share in NOR Flash and deep cooperation in DRAM with Changxin Storage. Its DDR5 products have entered the server supply chain, and SSD controller chips are adapted to AI PC needs.
2.Lanqi Technology (688008): Invisible Champion in Memory Interface Chips
With over 40% global market share in memory interface chips, DDR5-related products (MRCD, MDB) have been sampled to major global manufacturers, supporting transmission rates of up to 12800MT/s. The company is actively laying out HBM supporting chips and will benefit significantly from AI server upgrades in the future.
3.Bawei Storage (688525): Leader in Integrated Storage Modules and Testing
Focusing on enterprise-level SSDs and automotive-grade storage, the company reported revenue of 3.912 billion yuan in the first half of 2025, with Q2 losses significantly narrowing to 2800 yuan, indicating a recovery at the industry bottom. The company has established its own testing production line and has reserves in HBM packaging technology, closely collaborating with domestic AI server manufacturers.
4.Jucheng Co. (688123): Leader in the SPD Chip Submarket
With over 30% global market share in SPD (memory configuration chips), the products are deeply bound to original manufacturers like Samsung and SK Hynix. As the penetration rate of DDR5 increases, the demand for SPD will continue to grow, and the company’s market share in AI servers is expected to expand.
5.Puran Co. (688766): Invisible Champion in Low-Power Storage Chips
As a core supplier of NOR Flash and EEPROM in China, Puran Co. occupies an important position in the Internet of Things and automotive electronics. Its 40nm NOR Flash products feature ultra-low power consumption and are widely used in smart wearable devices and industrial control scenarios, with automotive-grade EEPROM having passed AEC-Q100 certification.
6.Hengshuo Co. (688416): Pioneer in Integrated Storage and Computing Technology
Continuing breakthroughs in the NOR Flash field while also laying out integrated storage and computing AI chips, its 50nm chip has a computing power density three times that of NVIDIA’s H100 and has received orders from Hikvision for smart cameras.
7.Fudan Microelectronics (688385): National Team for High-End Storage Chips
The storage business covers EEPROM, NOR Flash, and SLC NAND Flash. Its EEPROM products are deeply bound to high-end markets such as aerospace and military, while also actively expanding SPD chip applications in the AI server field. As a key enterprise supported by the Big Fund, under the accelerating background of domestic substitution, its technological barriers and market share are expected to continue to improve.
8.Huahai Qingke (688120): Leader in Storage Manufacturing Equipment
Huahai Qingke’s CMP (Chemical Mechanical Polishing) equipment is a key link in storage chip manufacturing, achieving large-scale application in DRAM and 3D NAND production lines, with long-term operational indicators reaching international levels, maintaining the top domestic market share.
9.Jiangbolong (301308): Leader in the Storage Module Industry Chain
As the second-largest independent memory manufacturer globally and the largest independent storage brand in China, its enterprise-level SSDs are directly adapted to AI server needs, with a 200% increase in orders in 2024 in collaboration with leading domestic cloud manufacturers.
10.Demingli (001309): Expert in Storage Control Chips and Solutions
Products include solid-state drives (SSD), embedded storage (eMMC), and industrial-grade storage solutions. In terms of synergy with computing power, AI server SPD chips have entered the Inspur Information supply chain.
The Technology Gap Can Be Filled at Any Time
Amidst the AI computing boom, the strategic value of storage power and storage chips is becoming increasingly prominent. Currently, the storage sector is significantly lagging behind the computing power sector, and tonight’s special trading suspension of Dongxin Co. may attract more attention to storage power. I expect that funds exiting the high-performing computing power sector will quickly discover and fill this rare value gap!