Chinese 12-Inch Wafer Giant Eswin Boosts Wuhan Factory Plan to $1.8B

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Shares of Eswin Material Technology saw an almost 5% increase during trading after the country’s leading producer of 12-inch semiconductor silicon wafers announced plans to invest 12.5 billion yuan (approximately $1.8 billion) to construct a new wafer manufacturing facility in Wuhan.

The company’s stock climbed as much as 4.5% to CNY24.86 (around $3.50) before retreating to close 1.2% lower, influenced by broader market trends. The composite index of the company’s primary trading platform declined by 1%.

The upcoming plant, located in central China’s Wuhan, aims to produce 500,000 of these 12-inch silicon wafers monthly, supporting the manufacturing of high-tech integrated circuits, including logic chips, flash memory, dynamic RAM, image sensors, and display-driver components.

Wuhan is a key center for the memory-chip industry in China. Currently, the company operates two wafer fabs in Xi’an, its hometown. For the Wuhan project, it intends to form a joint venture with a local government-backed investment platform to oversee investment, construction, and daily operations. The company will hold an 82.4% stake in the joint venture, with the remaining shares held by the local partner.

Once operational, the Wuhan facility is projected to raise the company’s total capacity of 12-inch wafers to more than 1.7 million per month. This expansion will improve service offerings for clients across central China and support customers in the Yangtze River Delta and Pearl River Delta regions, solidifying its market dominance domestically while bolstering its global competitiveness.

The company went public on the Shanghai Stock Exchange’s Star Market at the end of October, offering shares at CNY8.62 (about $1.30). All proceeds, totaling roughly CNY4.5 billion ($653 million), are designated for building its second manufacturing plant in Xi’an. On debut, the stock skyrocketed by as much as 362% during the trading day and closed at CNY25.75, marking a 198% increase from its initial offering price.