{
"title": "Basic Semiconductor Targets Hong Kong IPO as SiC Power Chips Gain Traction in AI Data Centers",
"content": "Shenzhen-based Basic Semiconductor has filed for a Hong Kong initial public offering on June 28, 2026, marking a major milestone for China’s silicon carbide (SiC) chipmakers as they aggressively target the booming AI data center market. The move signals that Chinese power semiconductor companies are no longer content to serve only the electric vehicle sector—they now see hyperscale cloud infrastructure as their next frontier.
Basic Semiconductor’s IPO prospectus highlights a strategic pivot toward high-voltage power solutions for AI server racks, riding the industry’s shift to 800-volt architectures. With training costs and energy demands of AI models like GPT-5 and China’s own Xiangqi-2 ballooning, data center operators worldwide are racing to upgrade power delivery, and SiC is a critical enabler.
The Unquenchable Energy Thirst of AI
Modern AI data centers are unlike anything the IT world has seen before. A single Nvidia H200 GPU can draw 700 watts; a rack packed with 72 such GPUs, plus networking and storage, can easily exceed 50 kilowatts—and next-generation racks are targeting 100 kW or more. Traditional 12-volt power distribution becomes absurdly inefficient at these levels, with resistive losses proportional to the square of the current.The solution is to step up the rack distribution voltage. The industry has been migrating from 12V to 48V, and now leading hyperscalers are adopting 800V DC distribution directly to the rack, with conversion down to lower voltages happening very close to the load. This “fac-to-rack” model slashes copper losses and enables thinner, more flexible power cabling.
Enter silicon carbide. SiC power devices, such as MOSFETs and diodes, can operate at much higher switching frequencies and temperatures than silicon. In power supply units (PSUs) and bus converters within AI racks, SiC reduces energy losses by 30–50%, shrinks component sizes, and improves reliability. For a 100 MW data center, that efficiency gain can save millions of dollars annually in electricity costs—and significantly reduce the carbon footprint, a critical metric for cloud providers like Microsoft that have pledged carbon neutrality.
The global SiC device market for data centers, though nascent, is projected to grow at a compound annual rate of 45% through 2032, reaching $3.8 billion, according to research firm Yole Intelligence. China, with its massive build-out of AI infrastructure under the “Digital China” initiative, is expected to account for a third of that demand.
Basic Semiconductor’s Road to the Hong Kong Stock Exchange
Founded in 2020 by Liu Zhen, a former power systems engineer at Huawei, Basic Semiconductor has grown rapidly by focusing on trench-gate SiC MOSFETs—a technology that reduces resistance and improves switching performance. The company started with industrial and automotive applications but pivoted toward data center power supplies in 2024 after seeing the exponential demand from AI.In its IPO filing, Basic Semiconductor disclosed revenue of $210 million for the fiscal year 2025, up 180% year-over-year, with data center clients contributing 40% of that total—up from just 5% in 2023. The company has supply agreements with Inspur, H3C, and other leading Chinese server makers, and it’s currently undergoing reliability qualification with a major U.S. hyperscaler widely believed to be Microsoft Azure.
The Hong Kong listing, which could raise up to $1.2 billion, would value Basic Semiconductor at around $3.5 billion. Proceeds will fund a state-of-the-art 200mm SiC wafer fab in Shenzhen’s Pingshan district, slated to begin production in early 2028. Currently, most SiC devices are made on 150mm wafers; moving to 200mm can slash per-die costs by 30%, making SiC more competitive with silicon.
“We are at the cusp of a redesign of the world’s power infrastructure, and AI is the catalyst,” Liu told reporters during the pre-IPO roadshow in Shanghai. “Our goal is to be the leading supplier of power semiconductors for the AI data center, not just in China but globally.”
China’s SiC Ecosystem: A Rising Tide
Basic Semiconductor isn’t swimming alone. China’s SiC industry has mushroomed, backed by Beijing’s determination to achieve semiconductor self-sufficiency. The National Integrated Circuit Industry Investment Fund (Big Fund III) has allocated $50 billion specifically for third-generation semiconductors, including SiC and gallium nitride (GaN). Local governments have topped up with land, tax incentives, and subsidized electricity.Competitors include Sanan Optoelectronics, which operates a massive 200mm SiC fab in Hunan; TankeBlue, a wafer supplier with ties to global foundries; and Hebei Sinopack Advanced Materials, which specializes in high-purity SiC powder. State-owned enterprises like CETC are also developing SiC devices for military and infrastructure applications.
The push is partly defensive. U.S. export controls on advanced silicon chips have forced Chinese cloud companies to accelerate domestic alternatives, and power semiconductors—though not restricted—are seen as strategic. By building a robust domestic SiC supply chain, China aims to reduce reliance on foreign suppliers like Wolfspeed, ON Semi, and Infineon, particularly as geopolitical tensions simmer.
However, challenges remain. Data center operators demand extreme reliability; a power converter failure can take down thousands of servers. Chinese SiC devices must prove they can match the defect rates and longevity of Western counterparts. Certification processes, such as those from the Open Compute Project (OCP), can take two years. There’s also the question of oversupply: with dozens of Chinese players adding SiC capacity, a price war could erode margins just as the market takes off.
800V Rack Power: The Technical Engine
To understand why SiC matters so much, it’s worth diving into the 800V rack power architecture. In a traditional data center, AC power is distributed at 208V or 480V to each rack, where a power distribution unit (PDU) steps it down to 12V for the servers. Each server then uses multiple voltage regulators to further reduce power to CPU/GPU levels. This cascade is wasteful.In an 800V DC architecture, a centralized rectifier converts AC to 800V DC at the facility level. That high-voltage DC is then routed directly to the rack, where a bus converter—using SiC MOSFETs—efficiently steps it down to an intermediate voltage like 48V. From there, point-of-load converters handle the final drop to chip voltages. The high switching frequency enabled by SiC allows these converters to be much smaller and more efficient, reducing cooling needs.
Microsoft, for instance, has been piloting 800V power in its Project Forge data centers since 2025, according to public disclosures. The company reported a 15% improvement in power usage effectiveness (PUE) compared to 48V architectures. Google and Amazon have similar programs.
For AI training clusters, where thousands of GPUs must operate in lockstep, stable power is critical. Voltage fluctuations can cause training jobs to fail, wasting millions of dollars in compute time. SiC’s faster response to load transients helps maintain tighter voltage regulation, improving cluster uptime.
Windows, AI, and the Azure Connection
Why should Windows enthusiasts care about power semiconductors? Because the AI features they increasingly rely on—from Windows Copilot’s in-line assistance to real-time translation in Teams—are powered by massive data centers running on these very technologies.Microsoft has been on an AI infrastructure spending spree. In fiscal 2026, the company’s capital expenditures are expected to surpass $80 billion, with a significant chunk going to data centers optimized for AI. Azure’s fleet includes millions of servers equipped with custom Maia accelerators and third-party GPUs, all drawing immense power.
Efficient power delivery directly affects the cost and availability of these AI services. Lower electricity bills translate to more competitive cloud pricing, which could trickle down to consumer subscriptions for Microsoft 365 or GitHub Copilot. It also helps Microsoft move toward its goal of being carbon-negative by 2030, a promise that’s become harder to keep as AI energy consumption surges.
While Microsoft sources its power infrastructure through a complex global supply chain, the influx of Chinese SiC chips could provide a cost-effective alternative to Western suppliers. Market analysts note that Chinese SiC MOSFETs are already priced 15–20% lower than comparable parts from U.S. and European manufacturers, even after import tariffs. If reliability concerns are addressed, hyperscalers may find the savings hard to ignore.
Moreover, Windows-powered edge devices could eventually benefit. SiC isn’t just for data centers; it’s also finding its way into high-efficiency power adapters for laptops. Microsoft’s Surface team, known for pushing power efficiency, could adopt SiC-based chargers that are smaller and cooler—a minor but tangible improvement for mobile Windows users.