China has worked for years to build its own semiconductors, but Macquarie thinks now is the time to buy. “We believe the best time to invest in China’s AI chip players has arrived, given the development of AI, domestic large language model (LLM) players and the token economy in China,” Macquarie’s China Information Technology analysts said in a late June report. “In addition, the PRC Government’s support on domestic AI chip firms (partially via import restriction of Nvidia GPUs which echoes with U.S. export controls) has lifted the growth visibility of domestic leaders,” the analysts said, referring to the Peoples Republic of China. While the U.S. is allowing some less advanced Nvidia chips to be sold to China, China is increasingly less eager to buy them. Huawei and its Ascend chips feature most in discussions about China’s AI-capable semiconductors. The company hasn’t indicated plans to go public. But other players in the sector are already traded in Hong Kong and mainland China. Macquarie initiated coverage on five, with Shanghai-listed Cambricon its favorite, rated outperform. “We believe Cambricon has shifted its core customer base from government intelligent computing clusters to leading domestic cloud providers and LLM developers,” the analysts said. “These customers provide a more balanced sales mix, healthy margins and solid cash flows.” Macquarie has a price target of 2,0 …
