$550 million invested in a GPU company that has been unprofitable for two consecutive years, Dashengda sets a $250 million betting line for successful tape-out

Ask AI · What are the risk control strategies for Dashengda’s cross-industry investment in semiconductors?

Blue Whale News, March 19 (Reporter Xu Ganggan) — A 550 million yuan cross-industry investment has brought Dashengda (603687.SH), a leading paper packaging company, and domestic GPU manufacturer XinTong Semiconductor into the spotlight due to a “success in tape-out is required to receive the remaining 250 million yuan” betting clause.

On the evening of March 18, Dashengda announced that the company plans to invest a total of 550 million yuan through equity transfer and capital increase to acquire a 22.9831% stake in XinTong Semiconductor Technology (Xiamen) Co., Ltd. After the transaction, Dashengda will not gain control of the target company but will have a board seat and veto rights on major matters.

While cross-industry investments by listed companies are common, a leap from traditional paper packaging to the hot semiconductor sector has attracted widespread market attention. The day after the announcement, Dashengda’s stock price hit the daily limit, and by the close on March 19, it remained firmly at the limit down despite the market falling below 4,000 points.

However, behind this cross-industry “marriage” lies a life-and-death bet on “successful tape-out.” For XinTong Semiconductor, whether it can receive the 250 million yuan investment depends entirely on the success of its third-generation GPU tape-out. For Dashengda, if it fails, the initial 300 million yuan investment—does it mean “water under the bridge”?

A Bet with Conditions: 250 Million Yuan “Conditional” Investment

According to the announcement, Dashengda’s 550 million yuan investment is divided into equity transfer and capital increase: the company plans to acquire 2.71% of XinTong Semiconductor’s shares by paying 27.86 million yuan, and 1.60% by paying 22.14 million yuan, totaling 50 million yuan for 4.30% of shares.

Simultaneously, the company plans to increase its stake in XinTong Semiconductor by 500 million yuan, split into two rounds: the first 250 million yuan upon meeting certain conditions, and the second 250 million yuan contingent upon the successful tape-out of the third-generation GPU.

This means XinTong Semiconductor must pass the “third-generation GPU tape-out” hurdle to receive the full 550 million yuan.

Dashengda explained that this move is based on its long-term strategic development, actively responding to national strategies, and seizing new productive forces. The company states that it will conduct investments without affecting its daily operations or putting financial pressure on its core business.

Founded in 2004 and headquartered in Hangzhou, Dashengda is a leading enterprise in China’s paper packaging industry, listed on the Shanghai Stock Exchange main board in 2019. Its main products include corrugated boxes, high-end wine packaging, and premium cigarette packs, recognized as one of China’s “Leading Packaging Enterprises” by the China Packaging Federation. Financial data shows that in the first three quarters of 2025, the company achieved revenue of 1.587 billion yuan and net profit attributable to shareholders of 90.93 million yuan, with an asset-liability ratio of about 19.96% at the end of Q3.

Quality of the Target: Revenue Doubling but Still Loss-Making

Investors are concerned that XinTong Semiconductor’s assets have a debt ratio of 130%, with a total loss of 150 million yuan over two years.

Public information shows that XinTong Semiconductor was founded in 2019. Its founding team has over a decade of experience in GPU technology. To date, it holds hundreds of invention patents, dozens of software copyrights, and multiple circuit layout designs. Its self-developed new high-performance general-purpose GPU chips target imported high-end GPUs and support applications in digital twins, healthcare, manufacturing, autonomous driving, AI, and scientific computing.

Financially, XinTong Semiconductor is a typical “R&D-driven company”: revenue in 2025 is expected to reach 50.78 million yuan, up 85% year-over-year; net loss is 48.996 million yuan, narrowed by 54% from 107 million yuan in 2024. However, as of the end of 2025, total assets are 64.96 million yuan, total liabilities are 84.63 million yuan, and owner’s equity is negative 19.67 million yuan, with a debt ratio of 130%, indicating insolvency.

Despite losses, the pre-investment valuation of XinTong Semiconductor in this deal is as high as 2 billion yuan. Dashengda’s investment is a timely “blood transfusion,” but it comes with strict betting conditions.

Negative Net Assets: XinTong Struggles to Afford Tape-Out Costs

In chip design, “tape-out” is the critical step of turning design drawings into physical chips—sending files to foundries for manufacturing prototypes. Success means the chip design functions correctly at the physical level; failure not only wastes funds but can also delay progress and cause market opportunities to be missed.

“Before results come out, the success rate of tape-out is unpredictable,” a investor from Haiguang Information told Blue Whale News.

GPU chips, being among the largest and most complex, are far more difficult to tape out and manufacture than simpler chips like MCUs or power management ICs. An industry insider explained that GPUs were initially used for graphics acceleration but are now widely applied in high-computation scenarios—from early cryptocurrency mining to AI. The success of these applications depends on GPU chips.

“Success rates depend on the process technology and performance goals,” the insider said. “Second-generation chips use 12nm, third-generation probably 10nm or 7nm. These are mature processes. I don’t know which foundry XinTong is using. If it’s TSMC, it’s less difficult; if it’s a domestic fab, 7nm success is still challenging.”

Although exact figures are unavailable, the high cost of tape-out is an industry consensus. Given XinTong’s negative net assets of nearly 20 million yuan at year-end 2025, it is unlikely to afford the costs of advanced process tape-outs itself.

Despite the difficulty, industry insiders also suggest another possibility: “They might not be working alone. If they have ecosystem partners or collaborators, the failure probability could be significantly reduced.”

Public info shows XinTong’s GPU products are compatible with domestic CPUs like Loongson, Feiteng, Haiguang, Huawei Kunpeng, and mainstream OSes such as UnionTech and Kylin, with over 60 ecosystem partners certified.

Sources indicate XinTong is also a client of a major domestic semiconductor testing organization, though with small order volumes. “Generally, companies that are willing to invest in testing and inspection tend to be larger,” an insider said.

Regarding potential technical support from top industry partners, Blue Whale News contacted Dashengda’s investor relations, which responded: “If there are any developments, we will issue relevant announcements as required. We cannot comment further at this stage.”

It’s noteworthy that the “industry capital” introduced for XinTong—Hainan Hechuang Xinrong—plans to invest 438 million yuan to acquire an 8% stake in Dashengda. The company claims to have “strong industry background” and “rich business experience and financial strength” to support XinTong Semiconductor with technology and supply chain resources.

However, the announcement states that Hainan Hechuang Xinrong was established in January 2026, less than two months ago, with paid-in capital of zero.

Public records show that Tang Xingfang (executive partner) and Tang Yongcai (major shareholder) have no publicly known semiconductor industry experience or related investments. Their business scope mainly includes investment activities, tech intermediary services, internet data services, software development, AI resources, and tech consulting.

Multiple Layers of “Locking” — Dashengda’s Risk Control Tactics

Dashengda has set up multiple protective measures for this cross-industry investment.

The capital increase is based on a pre-investment valuation of 2 billion yuan, with the equity transfer valuation at 1.16 billion yuan. The valuation gap reflects old shareholders “discounted exit” and new investors paying a premium.

More importantly, governance arrangements are in place. Dashengda explicitly states that it does not acquire control of XinTong Semiconductor, citing strategic prudence to “avoid risks associated with seeking control and cross-industry integration.” To protect its interests, the transaction agreement grants Dashengda a board seat, veto rights on major decisions, and includes performance commitments, share buybacks, and anti-dilution clauses.

A particularly critical clause is the buyback provision: if XinTong Semiconductor’s third-generation GPU fails to tape out within the agreed timeframe, or if after product launch, sales do not reach 500 million yuan over two full fiscal years, Dashengda has the right to require the company to buy back its shares. Despite these strict terms, the future of this cross-industry move remains uncertain.

The transaction has also attracted regulatory attention. On the evening of March 18, the Shanghai Stock Exchange issued a regulatory work letter concerning “the external investment and transfer agreement of Zhejiang Dashengda Packaging Co., Ltd.,” involving the listed company, directors, supervisors, senior management, controlling shareholders, and actual controllers. The specific contents of the letter have not been disclosed.