IPO Insights | Xinde Semiconductor, established just 6 years ago, passes listing hearinghow should we view the growth potential of this rising star in advanced packaging and testing?

Title context: IPO Insights | Xinde Semiconductor, established just 6 years ago, passes listing hearinghow should we view the growth potential of this rising star in advanced packaging and testing? Text: Founded only in September 2020, Xinde Semiconductor seems to be just one step away from knocking on the door of the Hong Kong Stock Exchange. GMTEight noted that Xinde Semiconductor recently passed the HKEX listing hearing. This company, whose main business is providing semiconductor packaging and testing services, has achieved leapfrog revenue growth over the past few years. Data shows that from 2023 to 2025, Xinde Semiconductor's revenue was RMB 509 million, RMB 827 million, and RMB 1.012 billion, respectively. In the process of its scale reaching successive new levels, the company also submitted its first listing application to the HKEX at the end of 2025. One year later, Xinde Semiconductor passed the hearing as it wished. Against the current backdrop of tight advanced packaging capacity and spillover demand for AI computing packaging, Xinde Semiconductor passing the hearing at this time may be said to be timely. On the one hand, the window for domestic substitution in packaging and testing is opening, and advanced packaging capacity has become a scarce resource in the industry chain; on the other hand, the company's revenue has continuously reached new levels over the past few years, economies of scale are gradually emerging, gross margin is continuing to recover, and its growth path is becoming increasingly clear. Listing in Hong Kong at such a point in time allows Xinde Semiconductor to obtain the funds needed for expansion and, with the help of the Hong Kong market, also gives it hope of occupying a more favorable position in the global expansion of its business footprint. Revenue continues to reach new levels Xinde Semiconductor operates under the OSAT model, and its customers are mainly fabless semiconductor design companies. Xinde is mainly responsible for packaging design, customized packaging products, and testing services, while customers focus on chip design and wafer manufacturing. According to the prospectus, Xinde Semiconductor's product matrix covers BGA, LGA, WLP, 2.5D/3D, as well as FC-QFN and FC-SOT. Among these, BGA, LGA, WLP, 2.5D/3D, FC-QFN, and FC-SOT are classified as advanced packaging, while WB-QFN belongs to traditional packaging. Based on 2025 advanced packaging revenue, Xinde ranks seventh among general OSAT companies in China, with a market share of 0.6%. As mentioned at the beginning of the article, over the past few years Xinde Semiconductor has achieved leapfrog growth in revenue. From 2023 to 2025, the company's revenue increased from RMB 509 million to RMB 1.012 billion, corresponding to a compound growth rate of 41% during the period. In the first four months of 2026, Xinde Semiconductor's revenue was RMB 360 million, a year-on-year increase of 17.4%. Breaking down the product structure, from 2023 to 2025, QFN revenue increased from RMB 173 million to RMB 313 million, with its share falling from 34% to 30.9%; BGA increased from RMB 183 million to RMB 306 million, with its share falling from 36% to 30.2%; LGA increased from RMB 82 million to RMB 213 million, with its share rising from 16.1% to 21.1%; WLP increased from RMB 70 million to RMB 176 million, with its share rising from 13.8% to 17.4%. The revenue scale of 2.5D/3D is still small, at only RMB 244,000 in 2025, mainly from non-recurring engineering batches. In the first four months of 2026, the shares of QFN and LGA rose to 34.4% and 24%, respectively, while the shares of BGA and WLP were 27.1% and 14.1%, respectively. Overall, over the past few years, revenue from packaging products and testing services has consistently accounted for more than 99.6%, while other revenue is mainly from the sale of scrap and materials. Among downstream applications, communications revenue reached RMB 406 million in 2025, with its share rising to 40.2%, while the share of consumer electronics fell to 54.3%. Communications became the main driver of revenue growth. In terms of customer concentration, the top five customers contributed 54.6% of revenue in 2025, with the largest single customer accounting for 24.5%. While revenue is expanding, because the company as a whole is still in a period of strategic investment, Xinde Semiconductor has not yet completed its turnaround. However, a positive signal is that, in terms of profitability, Xinde Semiconductor's gross margin has improved from -38.4% in 2023 to -18.0% in 2025, and further optimized to -17.9% in the first four months of 2026, showing that the company's profitability has recovered somewhat. Is the pace of realizing growth expectations expected to accelerate? Driven by diverse applications in industries such as high-performance memory, data centers, automobiles, and consumer electronics, the semiconductor advanced packaging and testing market is expected to maintain rapid growth for a relatively long period in the future. Xinde Semiconductor's prospectus shows that the global semiconductor advanced packaging and testing market was worth RMB 396.7 billion in 2025 and is expected to grow to RMB 790.3 billion by 2030, corresponding to a compound annual growth rate of 14.8% during the period. Among this, the size of the Chinese market in 2025 was approximately RMB 126.2 billion and is expected to increase to RMB 298.5 billion by 2030, with a compound annual growth rate of 18.8% during the period. The market space is broad, and Xinde Semiconductor itself is also strengthening its technology matching capabilities by increasing R&D investment, thereby promoting the conversion of potential demand into actual revenue. It is said that Xinde Semiconductor is currently increasing investment, with 2.5D/3D packaging as the core engine, and coordinating multi-dimensional technological collaborative breakthroughs. Specifically, Xinde Semiconductor is deepening the construction of four major technology platforms under the CAPiC architecture: LDFO, X-SiP, TXV, and 2.5D/3D, consolidating the technical foundation of its full product line. Among these, FOCT-S and FOCT-L benchmark against CoWoS-S/L and target the heterogeneous integration needs of mobile AP and HPC AI chips, serving as key levers for attracting high-end customers; TGV technology, meanwhile, addresses the performance limitations of silicon-based TSV in large-size and high-frequency scenarios, gradually building a complete technology matrix from glass-based IPD to RF modules. At the same time, at the market level, Xinde Semiconductor plans to strategically expand into overseas markets, with a focus on Taiwan, China, South Korea, Japan, Southeast Asia, the United States, and Germany. In Xinde Semiconductor's ambitious expansion plan, listing is naturally an indispensable part. The company plans to use the funds raised from the listing to expand 2.5D/3D and substrate packaging capabilities, build a new expansion project at its Nanjing production base, and at the same time upgrade existing production lines and recruit R&D and manufacturing personnel. In summary, the author believes that Xinde Semiconductor's rapidly growing scale and gradually improving profitability constitute the main financial highlights of this new stock. Against the backdrop that the competitive landscape of China's advanced packaging and testing industry is far from reaching its final stage and the market size will continue to maintain rapid growth in the coming years, whether Xinde Semiconductor can consolidate or even expand its competitive advantages by increasing R&D and expanding production capacity is presumably also well worth investors' continued attention.