Rebirth 08: Rise from copycat phones

Chapter 505 Announcement of Domestic Listing Plan
In late April, Xu Shenxue met with the heads of top domestic financial institutions at Zhiyun Group’s headquarters to discuss the final plan for Zhiyun Group’s domestic listing, especially the funding aspect.

The main reason is that Zhiyun Group's market value is too high. According to the plan to issue 10% of its shares domestically, the amount of funds raised will reach 270 to 280 billion US dollars, which is equivalent to more than 1.8 trillion Chinese yuan.

This far exceeds the amount of new funds added to the domestic stock market each year.

The amount of new funds in the domestic stock market each year is only a few hundred billion yuan, which is less than one-third.

This means that Zhiyun Group’s plan to go public in China cannot directly attract funds from the existing funds in the domestic stock market.

So where does the money come from?
There is no need to worry too much about this. There is sufficient amount of funds in the country, but a considerable amount of funds is not in the stock market but in other areas.

For example, real estate, for example, deposits!

Let’s not talk about real estate, let’s talk about deposits. The amount of deposits in the country is very large. Having so much money in the bank without spending it is actually a problem, which will lead to sluggish domestic demand.

In addition, the amount of new funds for insurance and social security is also very large each year.

However, all of the above-mentioned amounts of funds lack a good investment channel.

Now, in the past two years, Xu Shenxue has provided these funds with a better investment channel: his subsidiaries have been listed in the country one after another to absorb these funds.

In addition to providing sufficient development funds to enterprises, it can also give these funds a better return on investment.

This time, Xu Shenxue's meeting with major financial institutions was mainly to discuss financial matters.

The process and results of the talks were good. After all, many of the previous specific plans had already been made by the staff. What Xu Shenxue had to do was actually very simple. He just showed up and talked about the future to give these investors more confidence.

Finally, the corresponding plan was finalized.

When Zhiyun Group goes public in China, most of its 10% shares issued will be purchased and held by these financial institutions. The funds of these large financial institutions will be mobilized from other fields and will not be drawn from the existing stock market funding pool!
Only a small number of issued shares are aimed at ordinary investors from the outside world, such as some small and medium-sized investment institutions, ordinary shareholders and the like.

More specific plans will be further improved by many subsequent staff members.

We need to share profits and carry out bundling, but we must not affect the health of the domestic stock market by excessively withdrawing funds.

As for the funds raised by Zhiyun Group after its domestic listing, most of them will be used for the research and development of various new technologies and the further expansion of core businesses!
For example, in the semiconductor field, Zhiyun Microelectronics, a subsidiary of Zhiyun Group, is massively expanding the production of its seven-nanometer process. It is also developing an equivalent five-nanometer process and building a five-nanometer factory.

It is worth noting that Zhiyun Microelectronics' equivalent five-nanometer process is also developed based on the HEUV-300B lithography machine provided by Gulf Technology. Therefore, when building a five-nanometer factory, although its technical difficulty is higher, there will not be a major problem of lack of core equipment.

Unlike when we were developing the second-generation 300-nanometer process, we required a top-level lithography machine like the HEUV-B lithography machine. A large number of other core equipment also needed to be specially developed, which was extremely difficult.

It is now much easier to work on 300-nanometer technology. The core lithography machines do not need to be changed. The current HEUV-B lithography machines can be used. In addition, many core semiconductor equipment can also be used. Only improvements need to be made on some equipment.

Therefore, Zhiyun Microelectronics is currently expanding the production of seven-nanometer process on a large scale, and is also building a factory for five-nanometer process.

The planned production capacity of these two process nodes is very large!
This is mainly because as the seven-nanometer process technology matures, especially the second-generation seven-nanometer process technology produced by EUV lithography machines matures, it can be used on a large scale in many chip fields. At the same time, the seven-nanometer process has a very good balance between cost and performance.

There is a process node similar to 14 nanometers, which has attracted a large number of chip manufacturers to gather at this process node to produce chips because of its good balance between cost and performance.

In the past few years, Zhiyun Microelectronics has made huge investments in production capacity in the 14-nanometer process node, including the 12-nanometer process node. As a result, Zhiyun Microelectronics now has an enormous production capacity of / process nodes. The total production capacity has reached pieces, and it is still expanding!
This process node is still the most important source of revenue for Zhiyun Microelectronics.

In the 7nm/5nm process node, Zhiyun Microelectronics' expansion plan is also very large. In the early stage, it planned a production capacity of pieces, and recently planned a production capacity of pieces. The planned production capacity of /nm process has reached pieces.

And this is still the current plan. As market demand increases, production will be further expanded!
Because the demand for advanced logic chips is increasing, whether it is mobile phone SOC, computer CPU, GPU, or various computing chips, the demand for seven-nanometer and five-nanometer processes will be very large!
For example, the demand for mobile phone SOC chips has always been very high. At present, only high-end flagship phones use the seven-nanometer process for mobile phone SOCs. However, with the passage of time, the price of seven-nanometer process chips continues to decline, and a large number of mid-range mobile phones will also use seven-nanometer process chips in the future, which will bring about greater demand for seven-nanometer process production capacity.

The same is true for the 5-nanometer process!
This is still referring to the seven-nanometer and five-nanometer processes. At the same time, Zhiyun Microelectronics is also planning the future four-nanometer, three-nanometer and two-nanometer processes.

These future advanced processes require higher technical requirements and greater investments. It is estimated that it will cost two to three hundred billion US dollars to build a semiconductor manufacturing plant with a three-nanometer process and decent production capacity.

The logic chip factory is just one of Zhiyun Microelectronics' technical directions. Zhiyun Microelectronics also has a memory factory with equally huge investment and planned production capacity, mainly using advanced processes such as 10-nanometer line width and below 10A/10B/C...

There are also flash memory chip manufacturing plants with more than 128 layers.

These are the current top chip manufacturing factories, and the newly expanded production capacity is expected to require the use of EUV lithography machines, which requires huge investment.

Then there are the advanced technology 3D packaging factories that are crucial for computing chips... These 3D packaging factories are also very expensive, requiring investments of billions of dollars.

Just in terms of capital investment in the semiconductor field, Zhiyun Group will spend two to three hundred billion US dollars every year in the next few years...note, every year!
And this does not include research and development, it is just the cost of building a factory!
Advanced technology is so expensive. This is also the reason why major semiconductor manufacturers have successively announced that they will stop entering the advanced technology market... It’s too expensive and we can’t afford it!

Today, a large number of once-famous semiconductor factories such as UMC and GlobalFoundries have announced that they will stop research and development of and investment in advanced processes.

Currently, there are only four companies still working on advanced technologies: Zhiyun Microelectronics, Sixin Semiconductor, Intel, and TSMC.

Not to mention Zhiyun Microelectronics, which is the world leader in advanced technology and production capacity... It was the first to complete the commercial production of the seven-nanometer process, the first to complete the commercial production of the second-generation seven-nanometer process, and also the first to complete the technical verification of the five-nanometer process. Barring any major surprises, Zhiyun Microelectronics will become the first company in the world to complete the commercial production of the five-nanometer process next year!
Even Zhiyun Microelectronics has made considerable technological progress in the three-nanometer process, and the company has already planned to carry out preliminary technical verification of the three-nanometer process.

In contrast, Fourstar Semiconductor and Intel fell behind last year, mainly because they were stuck in the quadruple exposure of the DUV immersion lithography machine... They couldn't figure it out no matter how hard they tried. It was not until this year that they got ASML's first generation of commercial mass-produced NXT3400BEUV that Fourstar Semiconductor's seven-nanometer process and Intel's ten-nanometer process were produced (the Technical Bureau standard is actually the seven-nanometer of several other companies).

TSMC, on the other hand, has the support of Apple, Qualcomm, AMD and other top American chip companies, and continues to advance the research and development and construction of advanced processes. Not only did it follow Zhiyun to develop the first-generation 7-nanometer process last year, it also followed Zhiyun to develop the second-generation 7-nanometer process this year. At the same time, they are also developing the 5-nanometer process, and if nothing unexpected happens, the technical verification will be completed this year.

As for whether they can go into mass production next year, it depends on their technological development capabilities.

The technical difficulty of advanced processes is increasing, and the investment is also increasing. This is actually a good thing for Zhiyun Group... Zhiyun is not short of money!
If they could simply squeeze out their competitors by spending money, the management of Zhiyun Group would die of laughter...

Unfortunately, there are many things that cannot be done even with money.

For example, even if TSMC has no money, Apple, Qualcomm, AMD, and a large number of other chip companies in the United States and other places will bite the bullet and give it money for research and development and expansion of production capacity.

We can't let TSMC fall behind and then sit back and watch that bastard Xu Shenxue dominate the pack.

They have already been blocked by Xu Shenxue in the field of computing power cards. If they are also blocked in advanced mobile phone chips, computer chips, server chips, and automotive chips in the future, then they would rather die than live and just jump into the Pacific Ocean together.

They can't imagine the scenario where Apple and Qualcomm shamelessly and humbly ask Zhiyun Microelectronics to manufacture their mobile phone SOCs, or AMD finds Zhiyun Microelectronics to manufacture its GPUs and CPUs...

They also have a sense of crisis, okay?
Therefore, even though TSMC lagged behind Zhiyun's 18nm process in the 20nm process era, and lagged behind Zhiyun's 14nm process in the 16nm process era, Apple and Qualcomm firmly supported TSMC and continued to place large orders. Even AMD, although it also found Zhiyun Microelectronics to do some foundry work, still gave most of its orders to TSMC. This is a competition involving life and death, and no one will compromise easily!
Therefore, it is not just Zhiyun Microelectronics that will continue to invest heavily every year, TSMC's annual capital expenditure is also very large.

For the huge Zhiyun Group, investment in the semiconductor field is only one aspect, and there are many other places to spend money.

It is expected that the funds raised from the domestic listing this time will be used not only for investment in the semiconductor field, but also for core new business areas, mainly robotics and virtual businesses.

Especially for virtual business, now is still the time to invest big money. The amount of funds needed is huge, and the R&D investment plan in the field of virtual equipment hardware is very large... In addition to continuing to develop the VR omnidirectional treadmill technology, the Virtual Equipment Division is also developing the non-invasive brain-computer interface technology route.

After all, in a virtual world, the ultimate technical solution is to use a non-invasive brain-computer interface!
In order to speed up the progress of technology research and development, the Virtual Equipment Division has entered the large-scale research and development stage in the research and development of non-invasive brain-computer interfaces since last year. Various technical routes directly adopt a multi-line parallel research and development model. In order to solve the problem of flexible electrodes and to better collect and feedback brain computer signals, the Virtual Equipment Division has set up more than 30 project teams...

This year, at least 5 billion US dollars have been planned for research and development in the field of non-invasive brain-computer interface, and there will be more in the following years... Zhiyun Group's virtual equipment division is determined to develop a non-invasive brain-computer interface.

Also belonging to the virtual business is the software part. The initial investment scale of the "virtual space" developed by Zhiyun Group's software and Internet division will reach the level of 8 billion US dollars, and the R&D investment in the next year will also be very large... To build an extremely large virtual world that is both illusory and real, the R&D investment is very huge.

Then there are Zhiyun Group's various messy new businesses, such as research and development in the field of quantum computers, which have now entered a stage of high investment, but the commercial returns are very small. At this stage, it is in a stage of pure money-wasting and huge losses, which also requires huge financial support.

Then the research and development of mature businesses, that is, various smart terminal businesses, is also a large number. To maintain market share, technological leadership is indispensable. If you don’t do research and development, your competitors will do it, and then one day your competitors will surpass you, and the market will be over.

Various research and development projects consume huge amounts of funds of Zhiyun Group every year.

Therefore, even though Zhiyun Group will raise several thousand US dollars through its domestic listing, Zhiyun Group can really spend the funds.

When it comes to spending money on research and development, it’s not about how much money you can spend, but how much money you have… because no matter how much money you have, it will eventually be burned through!
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After Xu Shenxue reached an agreement with these domestic financial institutions, the major domestic financial institutions began to raise money.

Zhiyun Group has also officially announced that it will be officially listed in China in September this year.

The announcement was made to further stimulate the capital market, mainly small and medium-sized domestic investors and stockholders, or even people who have no interest in stocks.

Don't underestimate the stock investors. The amount of capital held by domestic stock investors is still very large.

After all, the amount of deposits in the country is extremely large. Under normal circumstances, these deposits are either saved and not spent, or flow into the real estate market. As for buying stocks, very few people actually... Most people do not trust the domestic stock market!
But there are a few exceptions. Every time Xu Shenxue's company is listed in the country, it will trigger a large number of ordinary people to take out their savings and then invest in the stock market to buy stocks of Xu Shenxue's company!

This is a blind trust in Xu Shenxue.

This time, Xu Shenxue and many people in China actually hope to use Zhiyun Group, a top enterprise, to attract people's attention and try to get people to take out part of their savings to buy Zhiyun Group's stocks.

Again, too much deposit in residents’ bank accounts is not a good thing… It means that the economic system lacks good investment channels. Excessive deposits will also lead to poor liquidity, further leading to weak consumer demand, etc.

Therefore, this time when Zhiyun Group goes public in China, it actually carries the hopes of many people, not just Zhiyun Group itself.

In early May, during the holiday, Zhiyun Group officially held its first briefing for domestic investors, publicly telling investors about Zhiyun Group's domestic listing plan and future development plans, especially the purpose of raising funds.

The announcement of this series of detailed plans by Zhiyun Group also attracted a lot of coverage from domestic media and instantly became the most popular financial news in the country.

"Zhiyun has launched its domestic IPO, and is expected to raise more than 1.8 trillion yuan, once again breaking the record for the largest IPO fundraising in human history!"

"The CEO of a securities company said that Zhiyun's listing in China means that the domestic stock market has completely entered a mature and stable development path, which can provide the funds needed for the development of super-large enterprises and provide a good investment channel for domestic investors!"

There are also financial journalists who have conducted in-depth reports:

"Zhiyun's market value has increased more than twelve times from 216.3 billion US dollars when it was first listed to 2.7 trillion US dollars today. Strictly speaking, it is not the company with the highest growth rate, but it is the company with the most stable income and the largest capital capacity!"

"Among the many shareholders of Zhiyun Group, all of them are major strategic investment institutions. In addition to the Xu Shenxue family who directly holds a large number of shares, other investment institutions are all heavyweight institutions. Domestic ones include social security funds, major insurance funds, local municipal investment funds, semiconductor funds, etc. Foreign investment institutions are also well-known. It can be said that this is the super-large enterprise in human history that has been recognized by the most strategic investment institutions!"

"It is not only recognized in the primary market, but also in the secondary market of Hong Kong stocks. More than 90% of Zhiyun Group's public shares in Hong Kong stocks are held by major investment institutions. Its investors are spread all over the world and it is deeply trusted by major investment institutions around the world."

"Based on the information and forecasts we have learned so far, Zhiyun Group's plan to go public in China will also be supported by top domestic investment institutions. An insider at a securities company revealed that 80% of Zhiyun Group's publicly issued shares in China will be directly subscribed by major strategic institutions."

“The author believes that the listing of Zhiyun Group in China will not only boost domestic capital flows, but we will also see better changes in the financial reports of major investment institutions!”

"After all, Zhiyun is the only company with such a large scale that can easily handle more than 1 trillion yuan of funds and bring stable and high returns!"

Why do these strategic institutions invest in Zhiyun Group? Not only domestic investment institutions, but also foreign investment institutions?

Because Zhiyun Group’s market value is high enough and its scale is large enough to accommodate enormous amounts of funds. At the same time, Zhiyun’s stock returns are stable enough and maintain a high growth rate!
This is rare for big funds!

It is easy to make tens of thousands of dollars by investing 10,000 dollars.

It’s hard to make millions with a one million investment.

If you want to make hundreds of millions with a 100 million investment, it is very, very difficult.
As the amount of funds increases, the proportion of investment returns gradually decreases.

If it reaches 10 billion or 100 billion... you will find that it is extremely difficult to invest and obtain stable returns!
Zhiyun Group happens to be able to provide such a channel for large investment and stable returns!

This is the core reason why major strategic institutions are so keen on Zhiyun Group’s stocks!
Similarly, many small and medium-sized investment institutions, and even ordinary individual investors, also regard Zhiyun Group's stocks as a high-yield investment or a channel for stable investment.

The recognition from so many investors finally pushed Zhiyun Group’s market value to become so high as it is now!
Now that Zhiyun Group is going public in China, a large number of domestic small and medium-sized investment institutions and individual investors are gearing up for it. Even many people who do not play stocks but have some savings are planning to buy Zhiyun's shares.

If you buy Zhiyun stock and hold it for a long time, you can make more money than putting it in the bank...at least that was the case in the past.

And in the future... people will still trust Xu Shenxue and Zhiyun!
Of course, the premise is long-term holding. If it is short-term investment, it is called gambling...it is difficult to say whether you will make a profit or a loss.

After all, Zhiyun Group's stocks are not static, but will continue to fluctuate. When they rise, the market value will rise by hundreds of billions or even hundreds of billions of dollars. When they fall, the market value will also evaporate by hundreds of billions or even hundreds of billions of dollars.

As for gambling, nine out of ten times you lose, and this has nothing to do with Zhiyun!

(End of this chapter)