Cambricon Shares Continue Rising; Investors Optimistic Despite STAR50 Index Rebalancing

Staff Reporter | PNN

Shanghai/Hong Kong: Investor interest in China’s AI chip manufacturer Cambricon remains strong, even as the major technology index STAR50 is set for rebalancing, which could trigger a passive outflow of approximately $1.01 billion.

Cambricon shares doubled in August, pushing their weight in the STAR50 index beyond the 10% threshold. Analysts say this rebalancing may cause temporary market pressure but will not affect long-term growth prospects for China’s AI sector.

CLSA analyst Shihao Li stated, “Some investors may sell to take profits, but this will not affect long-term trends or active management positions based on fundamentals.”

China’s AI stock rally has been fueled by government support, technology investments, and large AI projects from Alibaba, Tencent, and Baidu. Cambricon has seen a 113% rise in 2025, with most gains realized in the first half of the year.

The company achieved CNY 2.9 billion in revenue and nearly CNY 1 billion in profit in the first half. Annual revenue is estimated to be CNY 5–7 billion.

Analysts suggest that China’s foreign technology replacement policies could further support Cambricon’s growth, although its stock price is still significantly lower than Nvidia’s.

The STAR50 index has increased by 5% this week, while China’s CSI AI Index has surged 60% this year, outperforming the broader CSI300 and Shanghai Composite indices.

Market attention on Cambricon is now focused on profitability and its ability to meet AI chip demand. Investors are optimistic that the company will strengthen its market position by successfully replacing foreign chips.