This article only represents the author's own views.
Despite U.S. efforts to isolate China’s young microchip industry, the sector remains very much connected to an extremely competitive global marketplace. That difficult reality is front-and- center in a new Hong Kong IPO application from analog chipmaker Suzhou Novosense Microelectronics Co. Ltd. (688052.SH), which is seeking investor cash a second time after listing on Shanghai’s Nasdaq-style STAR Market in 2022.
Novosense isn’t exactly a startup, with a history dating back to 2013. It was profitable for at least part of that history, recording an annual profit as recently as 2022, according to its listing document filed last Friday with the Hong Kong Stock Exchange. But its gross margin has plunged since that time, as the company faces stiff competition in a global chip sector that has recently added major new capacity after big shortages surfaced during the pandemic.