Chinese AI and Semiconductor Firms Surge in Hong Kong Debut as Tech Race with US Heats Up
- Why Are Chinese AI and Chip Stocks Rallying in Hong Kong?
- How Does This Reflect China’s Broader Tech Strategy?
- Who’s Next in Line for a Hong Kong Listing?
- What Does This Mean for the US-China Tech Standoff?
- FAQs
In a striking display of investor confidence, three major Chinese tech companies—Zhipu AI, Shanghai Iluvatar CoreX, and Shenzhen Edge Medical—made a blockbuster debut on the Hong Kong Stock Exchange this week, collectively raising HK$9.3 billion (US$1.19 billion). The strong performance underscores growing appetite for China’s homegrown innovation amid an escalating technological rivalry with the US. Analysts see this as a vote of confidence in Beijing’s ambitions to build self-reliant AI and semiconductor industries. Meanwhile, firms like xFusion and ChangXin Memory Technologies are reportedly eyeing listings, signaling a broader trend of Chinese tech firms turning to public markets for growth capital.
Why Are Chinese AI and Chip Stocks Rallying in Hong Kong?
The Hong Kong Stock Exchange witnessed a tech frenzy this week as three mainland Chinese companies—Zhipu AI (a large language model developer), Shanghai Iluvatar CoreX (a GPU designer), and Shenzhen Edge Medical (a surgical robotics firm)—saw their shares skyrocket on their first trading day. Zhipu AI, China’s first major AI model company to go public, closed 13.2% above its IPO price of HK$116.20, while Iluvatar CoreX surged 31.6% intraday before settling at an 8.4% gain. Edge Medical stole the show with a 36.4% opening pop and a 30.9% closing bump. Together, they hauled in HK$9.3 billion, a clear signal that investors are betting big on China’s tech self-sufficiency push.
How Does This Reflect China’s Broader Tech Strategy?
Beijing isn’t just cheering from the sidelines—it’s actively fast-tracking IPOs for semiconductor and AI firms to counter US tech dominance. "This isn’t just about fundraising; it’s about building national champions," says Marco Sun, MUFG’s chief financial markets analyst. Case in point: Zhipu AI, dubbed by OpenAI as China’s rising AI contender, plans to funnel most of its HK$4.35 billion proceeds into R&D. Similarly, Iluvatar CoreX (which raised HK$3.48 billion) will prioritize chip and accelerator development. "China’s AI story is just beginning," SUN adds. "Early-stage investments haven’t yet translated to profits, but the market’s patience reflects long-term conviction."
Who’s Next in Line for a Hong Kong Listing?
The IPO pipeline is heating up. xFusion, a key Chinese computing infrastructure provider, has reportedly hired Citic Securities to prep for a mainland listing. Meanwhile, memory chipmaker ChangXin Memory and Baidu’s AI chip unit Kunlunxin are also rumored to be exploring public offerings. Janice Hu, UBS China head, notes that while China’s listed tech firms are now valued at ~US$5 trillion (versus America’s US$30 trillion), the absence of a US$1 trillion player is "a gap that’ll close sooner than later."
What Does This Mean for the US-China Tech Standoff?
With Washington tightening chip export controls, China’s IPO spree looks like a countermove to nurture domestic alternatives. Baker McKenzie’s Dan Ouyang calls Zhipu AI’s listing "a milestone that funds its next growth phase"—a template other Chinese tech firms may follow. Still, the road ahead is uneven: as Hu points out, China’s tech valuations remain a fraction of America’s, suggesting this race is more marathon than sprint.
FAQs
How much did Zhipu AI raise in its Hong Kong IPO?
Zhipu AI raised approximately HK$4.35 billion (US$557 million) at an IPO price of HK$116.20 per share, reaching a market cap of HK$51 billion by closing.
Which Chinese tech firms are considering IPOs next?
xFusion, ChangXin Memory Technologies, and Baidu’s Kunlunxin are reportedly preparing for public listings, per industry sources.
Why are investors bullish on Chinese AI stocks despite US sanctions?
"China’s massive domestic market and government backing create a ‘walled garden’ for tech firms," explains BTCC analyst Liam Zhang. "Investors see long-term potential despite short-term headwinds."
