Analysis of the Profound Impact of the 'Hard Technology' Theme and Style Divergence in the 2025 A-Share Market

The 2025 A-share market witnessed a historic liquidity surge. As of December 22, the annual turnover of China’s A-shares exceeded

for the first time, hitting a record high [1]. Among them, the average daily turnover in August reached , surpassing the peaks of June 2015 and September 2024, becoming the highest record since Bloomberg had data [1]. This liquidity frenzy was not evenly distributed but showed a clear feature.

Data comparison clearly shows the extreme degree of style fragmentation:

• Average gain of hard technology sector
  : 64.62% (STAR 50 rose 45.8%, semiconductor up 68.3%, AI computing power surged 95.6%, robotics up78.2%) [0]
• Average performance of traditional consumption sector
  : -6.90% (baijiu down8.5%, traditional consumption down5.3%) [0]
• Style divergence degree
  : as high as
  71.52 percentage points
  , an extremely rare divergence in A-share history [0]

The STAR Market became the absolute main battlefield for capital. The STAR 50 Index rose 45.8% for the full year, with a P/E ratio climbing to 52.3 times and average daily turnover of 85 billion yuan [0]. In contrast, the valuation of the traditional consumption sector continued to be compressed, with the baijiu sector’s P/E ratio at only 25.4 times, forming a sharp contrast with the hard technology sector [0].

2025 became a key year for hard technology to move from concept to reality:

: Cambricon’s market capitalization once exceeded HK$350 billion, becoming the new ‘stock king’ of A-shares [2]. More symbolically, the domestic GPU twins— and —converged on the STAR Market. Muxi surged 7 times on its first day of listing, with its share price reaching 829.9 yuan, and a single lot’s maximum profit exceeded 390,000 yuan. Founder Chen Weiliang’s net worth soared to 45.6 billion yuan overnight [2]. Although these two companies are not profitable, they have received fanatical pursuit from the market, reflecting investors’ strong expectations for domestic substitution.

: 2025 was defined by the industry as the ‘first year of humanoid robot mass production’ [3]. Chinese companies like Unitree Robotics launched the G1 robot priced at only US$59,000, far lower than similar US products (above US$20,000) [3]. According to CIC Consulting forecasts, the global robotics industry market size will reach US$131.4 billion by 2028, with a CAGR of 16.4% from 2023 to 2028 [3].

Policy support at the national level was the core driving force of the hard technology theme throughout the year:

• National Integrated Circuit Industry Investment Fund Phase III launch
  : The third phase of the fund, launched in 2024, had a scale of 47.5 billion US dollars, focusing on chip manufacturing equipment investment [4]
• AI special fund
  : An 820 million US dollar AI investment fund was established in January 2025 [4]
• Trillion-level industry fund
  : The National Development and Reform Commission planned to set up a venture capital fund for robotics, AI, and high-tech industries, expecting to attract nearly 1 trillion yuan (about 140 billion US dollars) of capital within 20 years [5]

At the same time, ‘anti-involution’ policies were deeply promoted in traditional industries. Capacity governance measures were successively introduced in lithium battery, photovoltaic, steel, and other industries. CATL suspended lithium ore mining in Yichun, which was interpreted by the market as a signal of supply-side reform [6]. This policy divergence further intensified market style fragmentation.

The escalation of Sino-US tech games became a long-term catalyst for the hard technology sector. The US’s restrictive policies on advanced process chips and HBM have instead strengthened the logic of domestic substitution [2]. The merger case of Hygon Information and Sugon triggered a 120 billion yuan increase in the market capitalization of semiconductor stocks on the STAR Market in a single day, reflecting the market’s expectation for integration to enhance competitiveness [2].

The valuation level of the hard technology sector sparked fierce discussions:

• AI computing power sector P/E ratio
  : 88.6 times
• Semiconductor sector P/E ratio
  : 65.5 times
• Robotics sector P/E ratio
  :72.3 times [0]

Are these valuation levels far higher than traditional industries reasonable? The market split into two views:

believe that the hard technology sector is in the early stage of industrial revolution similar to the 2000 Internet and 2010 mobile Internet, and the current high valuation will be digested by future growth. Global AI infrastructure spending may reach 3-4 trillion US dollars by 2030 [7], providing huge growth space for domestic AI chip companies.

pointed out that Muxi expected a loss of at least 530 million yuan in 2025, Moore Threads lost 730 million yuan, and both companies expected to achieve break-even only in 2026-2027 [2]. Cambricon has been losing money for four consecutive years, with its stock price dropping by more than 84% at the lowest [2]. The high fever valuation and poor fundamentals form a huge contrast.

###3.2

The baijiu sector fell by 8.5%, and the traditional consumption sector fell by5.3% [0], reflecting the market’s pessimistic expectations for consumption recovery. However, this downturn also created opportunities for value investment. Leading companies like Wuliangye opened 474 specialty stores and experience stores, achieving significant growth in banquet场次 and bottle-opening volume [8], showing that consumption demand has not disappeared but is undergoing structural upgrading.

###4.1

1. Industrial cycle mismatch
   : Hard technology is in the growth stage, while traditional consumption is in the mature or even declining stage. This structural difference will last for many years
2. Clear policy orientation
   : The country’s support for hard technology is a long-term strategy that will not reverse in the short term
3. Demographic structure changes
   : Population aging limits the growth of traditional consumption, but the demand for automation and medical technology surges

###4.2

1. Valuation regression pressure
   : The 88-fold P/E ratio of the hard technology sector is unsustainable. If performance falls short of expectations, it will face severe adjustments
2. Consumption recovery expectations
   : As policy stimulus takes effect, traditional consumption is expected to usher in valuation repair
3. Global experience
   : After the 2000 dot-com bubble burst, tech and value styles rotated many times, and a single style is difficult to last forever

###5.1

According to Goldman Sachs’ 2026 outlook, global stock markets will show the characteristics of ‘

’ [9]. The profit contribution ratio of tech giants will drop from 50% to 46%, and AI dividends will spread from core hardware to the application layer. This means:

• Pure hardware speculation
  will cool down, and AI application layer companies may rise
• Traditional industries
  using AI to reduce costs and increase efficiency are worth attention
• Market concentration
  decreases, and investment opportunities will be more diversified

###5.2

1. Technological commercialization falls short of expectations
   : Humanoid robots have only achieved small-scale mass production so far. Ubtech lost 1.16 billion yuan annually and only delivered 10 robots [3], which is still far from large-scale commercial use
2. Geopolitical risks
   : US export controls may further escalate
3. Liquidity tightening
   : If monetary policy turns, high-valued tech stocks will bear the brunt

###5.3

: Be alert to the valuation correction risk of the hard technology sector, focus on leading enterprises with strong performance delivery capabilities

:

• Offensive allocation
  : AI application layer, semiconductor equipment, companies with global competitiveness in the robotics industry chain
• Defensive allocation
  : Mispriced traditional consumption leaders, especially enterprises with cash flow advantages and brand barriers

: Hard technology and consumption are not opposites. As AI technology penetrates into various industries, companies that can use AI to reconstruct business models will become real winners. ‘Tech empowerment’ of traditional industries may become the next investment theme.

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The reshaping of the A-share market by the ‘hard technology’ theme in 2025 is

and . This is not just a short-term rotation of market styles, but an inevitable result of the joint action of three forces: China’s economic transformation, global tech competition, and industrial policy guidance. The total market capitalization of A-shares exceeded 100 trillion yuan [10], marking that China’s capital market has entered a new era centered on technological innovation.

However, extreme style divergence is unsustainable. The market is likely to move toward

in 2026—hard technology will move from theme speculation to performance verification, and traditional consumption will seek opportunities for value revaluation in the valuation depression. What can truly cross the cycle will be companies that convert technological innovation into sustainable profitability, not all targets披着 the 'hard technology’外衣.

For investors, embracing the hard technology wave while maintaining a clear risk awareness and diversified allocation may be the best strategy to cope with this market ecological upheaval.

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[0] Jinling API Data - A-share Market Sector Performance and Valuation Data

[1] Yahoo Finance - “China A-share average daily turnover in August is set to hit a new high since data was available” (https://hk.finance.yahoo.com/news/中囜a股8月日均成交额势创有数据以来新高-流动性改善为股市行情助力-004119683.html)

[2] Yahoo Finance - “GPU wealth creation: A-share Muxi soars 7 times on first listing” (https://hk.finance.yahoo.com/news/gpu創富-a股沐曦首掛飆7倍-193600139.html)

[3] Yahoo Finance - “Practical Application 2: Stock Selection in the Robotics Industry” (https://hk.finance.yahoo.com/news/實戰應用2-機械人行業選股-061625119.html)

[4] Atlantic Council - “Reprogramming the future: The specialized semiconductors reshaping the global supply chain” (https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/reprogramming-the-future-the-specialized-semiconductors-reshaping-the-global-supply-chain/)

[5] Robotics & Automation News - “Chinese government to invest $140 billion in robotics and high-tech industries” (https://roboticsandautomationnews.com/2025/06/24/chinese-government-to-invest-140-billion-in-robotics-and-high-tech-industries/92517/)

[6] Yahoo Finance - “China lithium ore stocks reignite anti-involution trend: CATL’s lithium ore suspension may be the latest signal of capacity governance” (https://hk.finance.yahoo.com/news/中国锂矿股再燃反内卷行情-宁德时代锂矿停产或为产能治理最新信号-054701052.html)

[7] Yahoo Finance - “Wall Street wakes up! After AI burns $3 trillion, Goldman Sachs throws out soul-searching questions: Ten major issues will dominate the trend of tech stocks in 2026” (https://hk.finance.yahoo.com/news/華爾街覺醒-ai燒掉3兆美元後-高盛拋出靈魂拷問-十大議題將主導2026科技股走勢-023003632.html)

[8] Yahoo Finance - “Xinhua Silk Road: Chinese Baijiu Enterprises Hold Meetings to Seize Opportunities in Market Changes” (https://hk.finance.yahoo.com/news/新華絲路-中國白酒企業召開會議-把握市場變化中的機會-023400155.html)

[9] Yahoo Finance - “Goldman Sachs 2026 Global Stock Market Outlook: Broader Bull Market, Broader AI Beneficiaries!” (https://hk.finance.yahoo.com/news/高盛2026年全球股市展望-更廣泛的牛市-更廣泛的ai受益者-054004342.html)

[10] Compiled based on market data analysis