China Stock of the Day | Kabutaro & Friends

SMIC<688981>, China's largest semiconductor foundry, was the Chinese stock most talked about online on August 27, 2026.
Background: Its first-half 2026 results, released that day, showed revenue of RMB 38.635 billion, up 19.44% year on year; net profit attributable to shareholders of RMB 4.467 billion, up 94.16%; net profit excluding non-recurring items of RMB 2.994 billion, up 57.25%; and basic earnings per share of RMB 0.56. Gross margin improved 1.3 percentage points to 23.2%, operating cash flow reached RMB 20.760 billion, up 252.0%, EBITDA came to RMB 24.511 billion, up 40.7%, and R&D investment totaled RMB 2.725 billion. Second-quarter gross margin was 24.56%. The company attributed the profit growth to higher wafer shipments, a higher average selling price, and a shift in product mix. On the same day, semiconductor shares surged on NVIDIA's strong earnings and the STAR 50 Index rose 3.77%; SMIC closed at RMB 126.33, with a trailing P/E ratio of about 214 times.