At face value, your assessment makes sense.

Reform and opening up led to an economy that appeared more capitalist, but the communist party stayed in control. Rather than letting the markets and capitalists gain economic power AND political power, they only allowed them to gain economic power in order to speed up industrialization.

While we see capital controlling political will in liberal countries, they have no control in China and are kept in check by the party. This was less obvious over the decades after the policy began until about the 2010s, when China began shifting back in the socialist direction economically. They used capitalism to strengthen their economy, but never relinquished political control to capitalists. If they were indeed shifting towards capitalism, you would likely see them deindustrializing and shifting towards a finance-based economy more akin to the US. Labor rights would be deprioritized and industries would outsource their labor as wages increased. Instead you see the government making policies to strongly incentivize industries to continue with domestic production rather than outsourcing.

Take a look at the actions of the party and what you hear from Xi these days. Read through some of his writings. Does what you hear from the party and do the actions they are taking now seem like they are transitioning to capitalism when you dig a bit deeper and put it into this perspective?