Longsys launches Hong Kong IPO as profits boom

The Shenzhen-listed company is seeking to raise up to $800 million as its first-half profit surged by a factor of more than 700, fueled by spiking memory prices

By Teri Yu

Shenzhen Longsys Electronics Co. Ltd. (9976.HK; 301308.SZ) launched its Hong Kong IPO on Monday, seeking to raise up to HK$6.28 billion ($801 million) as it reported a record first-half profit on soaring memory chip prices. The company is offering 26.1 million shares for up to HK$240.60 each, giving Longsys an implied market value of up to HK$195 billion.

Longsys is part of a group of Chinese companies making second listings in Hong Kong to target the city’s international investor pool, in this case complementing its existing listing on China’s domestic market in Shenzhen. The company’s Shenzhen-listed shares are up around 50% so far this year, as investors have gravitated toward companies expected to benefit from global expanding AI infrastructure and broader semiconductor self-sufficiency drive.

Citic Securities and Citigroup are underwriting the deal. A group of cornerstone investors, including Lenovo and Ingenic Semiconductor, have agreed to buy 18.89% of the shares on offer. Subscriptions close on Thursday, with final pricing expected on Sept. 4, and a trading debut set for Sept. 8.

The IPO comes after a major earnings rebound for Longsys driven by higher memory prices from AI-related buying. Its revenue for the six months through June jumped 136.3% year-on-year to 24.09 billion yuan ($3.38 billion), while its net profit soared to 10.58 billion yuan from just 14 million yuan a year earlier, up by more than 700 times.

Longsys was founded in 1999 and listed on Shenzhen’s ChiNext board in 2022. The company has positioned itself as an independent branded memory-product maker with capabilities spanning controller-chip and memory-chip design, firmware algorithms, packaging and testing and sales. It markets its industrial and enterprise products under the Foresee brand, consumer storage under Lexar, and overseas industrial products through Zilia.

Longsys ranked ninth globally by 2025 storage-product revenue, and was second among independent memory makers, holding about 1.2% of the global memory-products market, according to third-party data cited in its listing document.

Enterprise storage, which offers Longsys a more direct route into AI infrastructure spending, was one of its fastest-growing businesses in the first half of this year. Revenue from the segment tripled year-on-year to 2.14 billion yuan, as its products entered the supply chains of several major internet companies and server manufacturers.

Its international operations also helped fuel the revenue expansion. Zilia generated 3.95 billion yuan in external sales in the first half of the year, up 184.6% year-on-year, while Lexar’s global sales revenue rose 84.9% to 3.97 billion yuan. Longsys generates nearly 70% of its revenue from outside Mainland China and serves customers including Dell, Lenovo, Mindray, Oppo, Samsung, Transsion and Xiaomi.

Longsys said production of its self-designed controller chips have exceeded 280 million cumulative units. Its 5-nanometer UFS 4.1 controller has entered large-scale production, while its newer storage processing unit chip supports NAND I/O speeds of up to 4,800 MT/s.

Longsys plans to use 78.3% of its IPO proceeds for R&D in chip design and advanced memory products. The balance will be used for capacity expansion at its plants in Suzhou and Brazil, and for global promotion of its Foresee, Lexar and Zilia brands, as well as potential strategic investments or acquisitions.

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