The Shenzhen Stock Exchange listing committee cleared a review of xFusion Digital Technologies’ proposed 8 billion yuan ($1.2 billion) ChiNext IPO in a filing dated 12 November, Reuters reported on 13 November. ChiNext is the exchange’s growth board. XFusion makes computing infrastructure, including AI servers.
Key points
- The committee said xFusion met requirements for share issuance, listing and disclosure.
- The proposed IPO would raise 8 billion yuan ($1.2 billion), according to the company’s May prospectus.
- The committee asked about gross margins and whether growth in operating performance could be sustained.
- Its questions covered computing demand, customer spending, cash flow and concentration among customers and suppliers.
Shenzhen committee clears listing review
The committee said xFusion satisfied requirements covering the issuance of shares, a listing and disclosure, Reuters reported, citing the exchange filing. The clearance advances the company’s proposed listing on ChiNext.
XFusion set out the 8 billion yuan ($1.2 billion) fundraising plan in its May prospectus. The prospectus names CITIC Securities as sponsor of the proposed listing.
XFusion faces questions on margins and demand
The listing committee also asked xFusion to explain the direction of its gross margin and whether growth in operating performance could continue, Reuters reported, citing the filing. It raised changes in demand for computing capacity and capital spending by customers buying the company’s products.
The committee’s questions extended to xFusion’s technology, net operating cash flow and the concentration of its customers and suppliers. It also asked whether the company had adequately disclosed the related risks.
The filing said there were no further matters for xFusion to address.
