More than nine listed firms have disclosed new investment made by the Big Fund since April last year, according to stock filings. These include Shenzhen listed Changchuan Technology, a semiconductor test equipment company, and GigaDevice Semiconductor, a Shanghai listed Integrated Circuit flash memory chip designer.
However, these investments are only "tip of the iceberg" of the investment made by the Big Fund, said Ng Sze Ho, a tech analyst with China Renaissance Securities. "In reality, the fund is leading others, like industry funds raised by local governments, and private equity funds, into China's chip industry."
The actual investment could be several times bigger than the figures reported in stock filing disclosures, he said.
Employees dressed in dustproof clothing work at a chip wafer plant in mainland China operated by Hong Kong-listed Semiconductor Manufacturing International Corp, one of the early investee companies of the China National Integrated Circuit Industry Investment Fund. Photo: Handout alt=Employees dressed in dustproof clothing work at a chip wafer plant in mainland China operated by Hong Kong-listed Semiconductor Manufacturing International Corp, one of the early investee companies of the China National Integrated Circuit Industry Investment Fund. Photo: Handout
The Big Fund initially raised about 138.7 billion yuan (US$21.8 billion), and had fully invested those proceeds by early 2018, official information showed.
A second round of fundraising closed in April, raising an additional 120 billion yuan, Reuters reported.
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Most of the capital from the first fundraising was invested into manufacturers of integrated circuits.
Since 2015, the state investment fund has built up a 15.1 per cent stake in Semiconductor Manufacturing International Corporation (SMIC), China's biggest foundry company.
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More recently, the fund has been investing in smaller, emerging companies, ranging from material research, to integrated circuit design, to manufacturing and testing, Ng said.
"The biggest difference we see today is that China is pouring money into every chain of the chip industry," he said.
"It also makes it more difficult for people to track the Big Fund, because they are engaging in more pre-IPO fundraising activities, which are under very low disclosure requirements, or indirectly investing in companies, which are partially owned by shareholders in which the fund has stakes" Ng said.