China's GPU maker Enflame surges 179% on debut, hits $23.3b market cap

Shares of Enflame, one of China's so-called "four little dragons" of GPU manufacturing, surged 179 percent on their first day of trading on the Chinese mainland market Friday (local time), as investor enthusiasm for homegrown AI chip companies builds amid Beijing's push to reduce its dependence on Nvidia and accelerate semiconductor self-sufficiency.

According to Chinese portal Baidu, Enflame's shares climbed as much as 234 percent from their IPO price of 142.18 yuan ($21) to 475 yuan in early trading on the Star Market, a technology-focused board, before giving back some gains to close at 397 yuan — up 179.22 percent on the day. The closing market capitalization stood at 170.9 billion yuan ($25.4 billion).

The listing came as Chinese companies increasingly turn to capital markets to fund their semiconductor independence drive. Through the IPO, Enflame issued 43.04 million new shares and raised 6.12 billion yuan ($912 million), giving the company a valuation of 61.2 billion yuan ($9.12 billion) at the time of the offering.

Chinese media outlets group Enflame, Moore Threads, Biren Technology and MetaX under the "four little dragons" label. Adding Iluvatar CoreX to the mix, the five companies are sometimes collectively called the "five little tigers" of China's AI chip industry.

Enflame was the last of the four to go public. According to Reuters and Bloomberg, shares of the other three have fallen sharply since their listings, with Moore Threads dropping more than 60 percent from its peak.

Analysts including Li Hui at Huajin Securities highlighted Enflame's position as a leading domestic cloud AI chip maker. They also noted Tencent's role as both a major shareholder — holding a 17.95 percent stake — and the company's largest customer. Last year, Tencent accounted for 83.79 percent of Enflame's total sales.

Enflame remains in the red. Its net loss narrowed from 1.51 billion yuan ($225 million) in 2024 to 1.16 billion yuan in 2025, but the company is still unprofitable. Losses of up to 860 million yuan are projected for the first three quarters of this year.

Enflame expects to reach breakeven either this year or next. Chairman Zhao Lidong told investors at an IPO roadshow earlier this month that the company anticipates achieving consolidated profitability in 2026 or 2027, taking into account its order backlog, product delivery schedules, labor cost budgets and research and development plans.

The rising profile of Chinese fabless chip companies reflects a broader push by Beijing and domestic firms to break free from an Nvidia-dominated market structure and achieve semiconductor self-reliance. The South China Morning Post has described Enflame as a challenger to US chipmaker Nvidia.