Chinese tech firms rise in Hong Kong debut as US-China tech race heats up
Three Chinese technology firms debuted higher on Thursday after raising a combined $1.19 billion, bolstering Beijing’s quest to compete with the U.S. in high-tech and setting the tone for what could be yet another busy year for new listings in Hong Kong.
All of the debutants traded above their offer prices. Artificial intelligence company Zhipu AI, also known as Knowledge Atlas Technology (2513.HK), opens new tab, opened 3.3% higher than its offer price of HK$116.20 apiece and traded around HK$126.00.
Shanghai Iluvatar CoreX (9903.HK), opens new tab, a semiconductor firm, started 31.6% higher than the offer price of HK$144.60, and changed hands at around HK$162.50.
Surgical robotics company Shenzhen Edge Medical (2675.HK), opens new tab jumped 36.4% above the HK$43.24 offer price, and traded at around HK$56.00.
The debuts of the three firms, which raised a combined HK$9.3 billion ($1.19 billion), come as Chinese authorities fast-track AI and chip listings to strengthen domestic alternatives to advanced U.S. technology, a backdrop that has drawn issuers across the tech sectors.
Huawei’s AI server spin-off xFusion has hired Citic Securities in preparation for a mainland IPO, while memory chipmaker ChangXin Memory Technologies and Baidu’s AI chip arm Kunlunxin are planning listings too, Reuters has reported.
Zhipu AI, spun out of Tsinghua University, raised HK$4.35 billion at HK$116.20, giving it a valuation near HK$51 billion.
It plans to use the bulk of proceeds for research and development. Cornerstone investors included JSC International Investment Fund and JinYi Capital Multi-Strategy Fund, among others.
Marco Sun, chief financial market analyst at MUFG (China), said the modest gains in recent IPOs, particularly Zhipu AI, should not be seen as fading enthusiasm for AI.
“Early-stage investments have yet to be cashed out for profit,” Sun said. “China’s AI story is only beginning to unfold, so it’s too early to draw conclusions.”
CHINA’s AI PUSH
Founded in 2019, Zhipu AI has become a leading player in China’s AI push. In June last year, OpenAI singled it out as a fast-rising rival, framing the company within Beijing’s push to expand Chinese-developed AI overseas. Zheng Peng, CEO of Zhipu AI, said the firm was “flattered” but its overseas expansion was “normal business”.
“As a frontrunner in the AI sector, this listing will provide the company with significant capital to fuel its next phase of growth,” said Dan Ouyang, partner at law firm Baker McKenzie, which advised the Zhipu AI IPO’s sole sponsor and underwriters, in a statement on Thursday.
Shanghai Iluvatar CoreX, a designer of general-purpose GPUs, raised HK$3.48 billion. Its offer price gave it a market capitalisation near HK$36.8 billion. It earmarked the bulk of its proceeds for R&D across chips, accelerators and software.
Shenzhen Edge Medical raised about HK$1.12 billion, which will fund its R&D, commercialization, manufacturing capacity and strategic acquisitions, among others.
Its cornerstone investors include Abu Dhabi Investment Authority, OrbiMed, UBS AM Singapore and Tencent’s Huang River.
The trio’s performance on Thursday will also help gauge whether Hong Kong can extend last year’s IPO resurgence, with $37.2 billion raised from 115 new listings, the strongest since 2021, according to LSEG data as of January 5.
The debut pipeline is growing, with MiniMax Group (0100.HK), opens new tab, another Chinese AI firm, and chipmaker OmniVision Integrated Circuits, due to start trading on Friday.
