Enflame’s Shanghai Debut Sparks 180% Rally, Minting Two New Billionaires

Investor excitement around China’s semiconductor sector has continued to mint billionaires, with Shanghai Enflame Technology’s two founders joining the three‑comma club after the firm’s shares jumped as much as 234% on their Shanghai debut.

The gain later narrowed, closing nearly 180% higher. The newly minted billionaires are 60‑year‑old Chairman Zhao Lidong and 48‑year‑old CEO Zhang Yalin, each worth about $2.1 billion according to Forbes estimates. Enflame did not reply to a request for comment.

Earlier this week Enflame raised 6.1 billion yuan (≈ $912 million) by selling roughly 43 million shares at 142.18 yuan each, per a stock‑exchange filing. The proceeds will fund the development of its next‑generation chips and associated software, the prospectus states.

Founded in 2018 by Zhao, a U.S. citizen, the company lists his résumé: over three decades in semiconductors, senior stints at AMD and Tsinghua Unigroup. His AMD tenure overlapped with that of Zhang Yalin, a Chinese national. Zhang, also a seasoned chip designer, led the creation of custom silicon for Microsoft’s Xbox One while at AMD’s China office and holds more than 50 patents, per Enflame’s site.

Whether the rally can endure is uncertain. Shen Meng, managing director at Beijing‑based boutique investment bank Chanson & Co., says the surge is fueled chiefly by enthusiasm for new‑issue semiconductor shares, as investors bet on China’s drive to build a self‑sufficient tech supply chain to counter U.S. export curbs, expecting such stocks to pop on debut.

Fundamentally, Enflame remains deep in the red. Like peers Biren Technology, MetaX Integrated Circuits and Moore Threads — whose shares also retreated from post‑debut highs — Enflame is pouring money into R&D. Together they are dubbed China’s four “little dragons,” striving to produce home‑grown alternatives to Nvidia’s processors.

Tencent is Enflame’s biggest customer, accounting for more than 80 % of revenue last year, which rose almost 40 % year‑on‑year to 990.2 million yuan. The net loss narrowed to 1.2 billion yuan from 1.5 billion yuan in 2024, per the prospectus. Tencent also holds nearly a 20 % stake, having invested since the firm’s 2018 inception, according to Qichacha. A 2019 agreement tasked Enflame with designing and tailoring AI chips for Tencent, a collaboration that has continued over the years.

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