Analysis of the Development and Countermeasures of China’s A-share Market

Abstract

Against the backdrop of China’s vigorous support for the development of domestic substitution in hard technology and its efforts to make breakthroughs in core technologies, chip enterprises—representing core tech sectors such as semiconductors—have attracted significant attention in the A-share market. Their stock prices often fluctuate sharply, driven by enthusiastic market sentiment and the logic of domestic substitution, while the risk of a disconnect between valuation and corporate fundamentals has become increasingly prominent. This paper takes Cambricon, known as the “first AI chip stock” and a focal point of the market in the second half of 2025, as its research subject. It conducts an in-depth analysis of Cambricon’s “rollercoaster” stock price trend: after surging by over 133% in the short term, its stock price subsequently underwent a sharp correction. The analysis reveals that such extreme volatility stems from two key factors: first, the mismatch between its excessively high “dream-driven valuation” and its actual performance; second, its fragile reliance on passive investments from external index funds and the global supply chain. This study not only uncovers the unique risk structure inherent in star technology stocks but also proposes practical countermeasures from two dimensions—internal corporate governance and the security of the external industrial chain. It provides important case references and practical insights for investors to make rational decisions.