From “Jewelry” to “Core Material for Chips,” diamonds are exploring new industry spaces.

Text | Reporter Ma Jiying, China Entrepreneur

Intern Reporter Shi Siyu

Editor | Mina

Cover Photo | Ma Jiying

“We unintentionally created a new industry.” When recalling how the company entered the cultivated diamond field and became a leading industry player, NPC deputy and chairman of Henan Liliang Diamonds Co., Ltd. (hereinafter “Liliang Diamonds”) Shao Zengming said.

The “new industry” he refers to is the cultivated diamond industry.

In 2010, Shao Zengming founded Liliang Diamonds and led the company to list on the ChiNext board of the Shenzhen Stock Exchange in September 2021. As of March 9 close, the company’s market value was about 12.1 billion yuan. The company’s initial business was diamond micro-powder, a basic material known as “industrial teeth,” widely used in photovoltaic cutting and precision machining. Shao Zengming states that during R&D from micro-powder to large-grain diamonds, they “accidentally” discovered an effective nitrogen removal material, which eliminated the yellow tint in diamonds and produced cultivated diamonds identical to natural ones.

Source: Visual China

In October 2025, the company announced the successful synthesis of a 156.47-carat cultivated diamond, setting a world record.

“Only by making the size larger can the slices be applied to high-power semiconductor scenarios,” Shao Zengming told China Entrepreneur in an interview. He believes diamonds have long surpassed the label of “jewelry” and are evolving into key functional materials supporting semiconductors.

Currently, Liliang Diamonds is shifting focus to frontier fields such as semiconductor heat dissipation. Shao Zengming explained that diamond has a thermal conductivity about five times that of copper, making it an effective solution for managing heat in high-performance chips, and it could even become the substrate material for next-generation chips. Although its current cost is still several times higher than copper, limiting large-scale replacement, the increasing heat dissipation requirements of high-performance computing may lead to a market equilibrium.

At this year’s National People’s Congress and Chinese People’s Political Consultative Conference, Shao Zengming proposed that the government support joint R&D between upstream and downstream of the domestic semiconductor industry chain to shorten the verification cycle of new domestic materials. He emphasized that China has the most complete industrial categories and a huge market, and through joint innovation, these unique advantages can be transformed into international competitiveness.

Below is an interview with China Entrepreneur (edited):

Joint Innovation Benefits Industry Development

China Entrepreneur: What topics did you focus on at this year’s NPC and CPPCC?

Shao Zengming: I have two suggestions. One is to ask relevant departments to support domestic semiconductor industry chain companies to collaborate more with domestic material companies for joint R&D or innovation.

China Entrepreneur: Why do you make this suggestion?

Shao Zengming: Many domestic companies have innovative products. Joint development is necessary because entering the semiconductor industry chain with new materials involves high entry barriers and long verification cycles, sometimes taking several years, at least a few months. Supporting more joint R&D projects will benefit industry development.

China has the most complete industrial categories and a huge market, giving us unique advantages in joint R&D that the world doesn’t have.

China Entrepreneur: Has your company already entered the semiconductor industry?

Shao Zengming: Yes, we have, and this process has gone through long-term verification.

Breaking the Path

China Entrepreneur: Why did the company want to produce a 156-carat diamond at that time?

Shao Zengming: Our country’s super-hard materials and diamond-related industries already hold significant influence and control internationally, leading positions. But the largest diamond has always been from a foreign company. We wanted to see if we could break through.

In fact, once diamonds are made larger, their applications are no longer limited to jewelry; many functional applications open up, and it also helps reserve technology for entering fields like semiconductor new materials.

Source: Liliang Diamonds Official Website

China Entrepreneur: Producing such a large cultivated diamond requires high technical standards. Which areas need breakthroughs?

Shao Zengming: It requires breaking through many technical limits, but it’s not convenient to detail. For years, no company has been able to do this; most are limited to around 10 carats, and larger sizes are very difficult.

China Entrepreneur: How long did it take your company to accomplish this?

Shao Zengming: It took about a year of experiments. The growth process is long, and we invested a lot of equipment and over ten million yuan in R&D. Making it larger isn’t just for jewelry; it’s for engineering materials. Once large, it can be sliced into diamond wafers for use in special fields.

We must open up this space; only then can the work be better done, like clearing the way. We are still further developing how to functionalize these large diamonds.

China Entrepreneur: How long do you think it will take to turn this into practical applications?

Shao Zengming: First, we need to transfer from laboratory to production line. Breakthroughs in lab technology are costly, and industrialization will take some time.

Unintentionally Creating a New Industry

China Entrepreneur: Why did you choose to start in the super-hard materials field?

Shao Zengming: We’ve been continuously deepening and climbing higher in this industry. Initially, we made diamond micro-powder, a highly advantageous and widely used industrial base material in China. Later, we extended along the industry chain to produce diamond crystals.

China Entrepreneur: Is micro-powder still the company’s main business?

Shao Zengming: Micro-powder has been our foundational industry for decades, with very mature quality, scale, and applications. Currently, the fast-growing segment is cultivated diamonds, which is our current incremental growth; but we are more focused on functional materials for the semiconductor field in the future, such as super-hard materials and thermal conductive materials, which represent future growth space.

China Entrepreneur: How does your company rank in the cultivated diamond industry?

Shao Zengming: In Zhecheng, Henan, the total cultivated diamond output is large, but we hold over 90% of the production, with other companies being relatively small.

China Entrepreneur: Why can your company hold such a large share?

Shao Zengming: Cultivated diamonds have only gained popularity in recent years, and many follow the trend. Originally, no one was doing it, but we kept at it because it’s a high-tech, capital-intensive industry with high technical requirements.

In fact, this industry was a byproduct of our high-end material R&D.

During the development from micro-powder to large-grain diamonds, we discovered an effective nitrogen removal material, producing colorless diamonds, which indeed created a new industry unintentionally.

Responding to Industry Adjustment

China Entrepreneur: What stage of your company’s development has the greatest technical challenge and innovation pressure?

Shao Zengming: We have always regarded innovation and R&D as the core driving force. With national policy support, overall development has been smooth. It’s a sunrise industry with constantly emerging demands and new opportunities, helping other industries grow.

For example, early photovoltaic relied on subsidies and had high costs. Later, costs dropped significantly, largely thanks to diamond cutting. It not only reduced pollution but also increased cutting efficiency nearly fivefold, completing the process in just over an hour.

Source: Liliang Diamonds Official Website

Because diamonds are extremely hard and sharp, cutting gaps are more precise. Using diamond cutting on silicon materials can produce about 50% more finished products, drastically reducing costs and boosting the development of photovoltaic and new energy industries.

Thus, the application scenarios for diamond materials are continuously expanding: from precision machining to new energy, and now to consumer industries. The next focus will be on the semiconductor field.

Primarily, heat dissipation applications. Diamonds have excellent stability and a thermal conductivity about five times that of copper, making them the best solution for high-temperature heat management. Looking further, the current chip substrate era is the “silicon age,” but in the future, it may enter the “carbon age,” using diamonds as substrates. If that era arrives, the entire semiconductor industry could adopt diamond substrates.

China Entrepreneur: What are the upcoming challenges? Is it achieving mass production with consistent quality?

Shao Zengming: The consistency of production has now been solved, but the downstream market still mainly uses copper-based heat dissipation materials. Transitioning will take time. The main current constraint is cost; diamond costs several times more than copper.

Ultimately, costs will be higher than copper, but as high-performance computing demands more rigorous heat management, when thermal management becomes a critical issue, the market will accept higher costs and seek balance.

China Entrepreneur: Do you have any experience to share regarding technological innovation?

Shao Zengming: First, clarify application scenarios and needs, then leverage industry advantages for R&D. Focus on future industries, helping high-tech sectors solve problems within material capabilities, and innovate around this.

China Entrepreneur: The company’s net profit has declined recently. What is the reason?

Shao Zengming: We are in an industry adjustment period. When cultivated diamonds first appeared, the market was small, and we had a phased leading advantage, enjoying high margins as a result of innovation. But over time, as technology becomes widespread, profits will return to a reasonable level.

Micro-powder remains our traditional mainstay, while cultivated diamonds have become a new mainstay. Next, we will develop diamond materials related to semiconductors to create new growth points.

In the past, we mainly used diamonds for their “hardness,” calling them “industrial teeth”; now, we aim to explore their “functional” applications, such as heat conduction. Diamonds have unique advantages in sound, light, and electricity, and in the future, we will expand from single-application hardness to multi-dimensional functions like thermal management.