<div id="readability-page-1" class="page"><div>CLSA released a report expecting that emerging AI applications will drive rapid growth in global and China memory demand simultaneously. Amid an unprecedented memory shortage, pricing power across the entire supply chain has improved, while capital expenditures have also increased.The broker forecasts that Chinas semiconductor memory market shipment volume will grow at a CAGR of 12%, while revenue will rise at a CAGR of 22%, reaching USD111 billion from 2024 to 2029.Memory manufacturers MONTAGE TECH (06809.HK) +2.200 (+0.466%) and GIGADEVICE (03986.HK) +57.500 (+7.391%) are benefiting from AI adoption and the upcycle in prices. Equipment suppliers AMEC (688012.SH) -24.740 (-5.098%) and ASMPT (00522.HK) +19.400 (+10.509%) Short selling $40.35M; Ratio 5.633% are poised to benefit from DRAM and advanced logic capacity expansion, as well as localization trends.In the AI chip and hardware segment, domestic substitution alongside demand for high-end optical interconnection will benefit BIREN TECH (06082.HK) +1.170 (+2.394%) Short selling $16.44M; Ratio 5.757% and ZHONGJI INNOLIGHT (300308.SZ) -2.640 (-0.242%) . Foundries SMIC (00981.HK) +7.250 (+9.080%) Short selling $1.35B; Ratio 8.174% and HUA HONG SEMI (01347.HK) +14.200 (+10.915%) Short selling $1.27B; Ratio 19.082% are expected to gain from the rising localization ratio of AI chipsets. The broker raised the TP for ZHONGJI INNOLIGHT to RMB1278 from RMB1010. For other AI application stocks target prices, please refer to a separate table. (ha/da)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-05-22 16:25.) (A Shares quote is delayed for at least 15 mins.)</div></div>

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CLSA reports that emerging AI applications will significantly boost global and China memory demand, with China's semiconductor memory market expected to grow at a CAGR of 12% in shipment volume and 22% in revenue, reaching USD111 billion by 2029. Companies like MONTAGE TECH and GIGADEVICE are benefiting from this trend, while equipment suppliers AMEC and ASMPT are positioned for gains. The report also highlights the impact of domestic substitution in the AI chip sector on companies like BIREN TECH and SMIC.

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GIGADEVICE

SMIC

ASMPT

MONTAGE TECH

AMEC

BIREN TECH

Zhongji Innolight

HUA HONG SEMI

Montage Technology

SMIC HK SDR 5to1

Hua Hong

CLSA: Rapid Growth in AI and Memory Industry, Rising Domestic Substitution Effect