The recent surge in semiconductor technology companies in China has gained significant traction, as evidenced by the latest entrant into the market—Xpeedic Technology, also known as Xinheng SemiconductorOn February 7, the Shanghai-based company initiated the process for an initial public offering (IPO) registration with the Shanghai Securities Regulatory Bureau, marking a crucial step towards its debut on the stock exchangeThe financial institution confirmed to assist in this venture is CITIC Securities, a trusted partner in navigating the complicated landscape of securities offerings.

This dynamic development brings to attention an ongoing wave of IPOs in China's Electronic Design Automation (EDA) sector, ever since the landmark introduction of Gaillon Electronics as the “first EDA stock” in December 2021. A veritable frenzy of capital markets activity has ensued—companies such as Huada Jiutian and Guangliwei have also successfully transitioned to public entities in quick successionThis has not only displayed the appetite of investors for innovation in EDA but also triggered further ambitions from firms like Guowei Sierxin and Xinyuanjing, which are strategizing their pathway to public listing.

Huada Jiutian, another frontrunner in the domestic EDA arena, recorded a remarkable first-day increase of 126% upon its stock market debut, catapulting its market valuation beyond 40 billion yuan and sporting a staggering issuance price-earnings ratio of 333 timesSuch a meteoric rise has proven to be lucrative for its backers, including prominent investors like SMIC Capital, who have reaped considerable rewards from their investments.

Echoing this pattern, Xinheng Semiconductor enjoys a similar benefactor in SMIC Capital, which has shown considerable interest in the EDA field through investments in various associated companies, including Xingxin SemiconductorThis affiliation highlights the interconnectedness within the industry and the strategic significance of financial partnerships that bolster growth.

At the helm of Xpeedic Technology is CEO Ling Feng, a distinguished returnee from an overseas academic journey

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DrLing earned his PhD in Electrical Engineering from the University of Illinois at Urbana-Champaign in 2000. As a senior member of the IEEE, he is the author of two book chapters, holder of five U.S. patents, and has published over sixty academic papers in core international journals and conferencesHis accolades also include being awarded the YTLo Outstanding Research Award from his alma materBetween 2007 and 2011, he contributed as a part-time associate professor in the Electrical Engineering Department at the University of Washington.

Beyond academics, DrLing boasts over 20 years of industry experience in EDA, RF, and System-in-Package designHis professional journey began at Motorola (now part of NXP), where he spearheaded research on RF module technologies utilizing LTCC and HDI substratesTwo years later, he transitioned to Neolinear, directing the development of electromagnetic solvers specifically for mixed-signal RF integrated circuit design, a venture which Cadence later acquired in 2004. Prior to founding Xpeedic Technology, he also co-founded Physware in 2007, providing leading-edge EDA tools focused on signal integrity, power integrity, and EMC from chip to packaging and system levels—this company was ultimately acquired by Mentor Graphics in 2014.

In establishing Xpeedic Technology in 2010, DrLing focused on rigorous research and development, a phase during which he sought to broaden his professional networkAfter five years of groundwork, Xpeedic landed a significant joint investment from SMIC Capital’s Eastern Fund and the Shanghai Internet of Things Venture Capital Fund in August 2015, a development that was reaffirmed by SMIC Capital’s President, Sun YuwangThe president acknowledged that with the rapid advancements in high-speed wireless communication, particularly developments in the 4G LTE landscape, the complexities associated with RF front-ends for mobile devices had intensified, presenting numerous design challenges

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The integrated passive components that Xpeedic specializes in possess marked advantages over traditional discrete components, including smaller size, superior performance, and lower costs, raising their profile in a rapidly evolving market.

The company achieved a pivotal milestone in 2021 by announcing over 100 million yuan in Series B financing, led by Shanghai Sailin and supplemented by existing investors’ increased stakesAt this juncture, DrLing highlighted that Xpeedic had forged a differentiated EDA simulation-solving technology, cultivated a robust ecosystem of semiconductor partners, and engaged with cutting-edge technologies such as cloud computing to establish a comprehensive EDA solution that spans the industry chain from chips to packaging and systems.

This growth trajectory persisted as Xpeedic garnered additional support from key institutional investors such as Shanghai Kechuang Investment Group, Xingsheng Investment, Jingkai Capital, Haiwang Capital, and Shangqi Capital, among others, further solidifying its financial backing.

Current corporate filings reveal that Xpeedic’s primary stakeholder is Shanghai Zhuohe Information Consulting Co., holding a direct 26.02% equity stake, via Shanghai Heai Enterprise Management Center (Limited Partnership) with an indirect control of 5.49%. Collectively, this amounts to a 31.51% shareholding in the companyMeanwhile, its Series A investors, including Zhangjiang Torch Venture Capital and Xuantian Capital, maintain significant stakes of approximately 15.97% and 12.50%, respectively, with contributions from SMIC Capital standing at around 3.50%.

With these developments, 2023 commenced with Xpeedic announcing a comprehensive upgrade to its full-stack integrated EDA platform, aiming to adapt to the burgeoning requirements spurred by artificial intelligence, such as high computing power, bandwidth, and low energy consumptionThis technological enhancement encompasses elements like Metis—a simulation platform for 2.5D/3D IC Chiplet advanced packaging designs, Notus—a multi-physical field analysis platform for chips, packaging, and PCBs, and ChannelExpert, dedicated to next-generation system signal integrity simulation and analysis.

This ambitious repositioning occurs in a wider context of consolidation within China's EDA industry

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Reports indicate that between 2022 and early 2024, there have been numerous investments and acquisition transactions involving over 16 companiesEstablished players like Huada Jiutian, Gaillon Electronics, and Guangliwei are also engaging in progress; for example, Huada Jiutian announced a $10 million acquisition of Chengda Chip Technology in October 2022.

As the trajectory continues, it raises a vital question—will Xpeedic Technology successfully launch its IPO, or could it pivot towards merger and acquisition strategies? The coming months will undoubtedly provide further clarity on its strategic intentions, as the dynamics within China’s fast-growing EDA landscape continue to evolve.