Shares of Shanghai Biren Expertise Co. jumped virtually 76% of their buying and selling debut on Friday, marking the very best first-day efficiency since early 2021 amongst Hong Kong listings that raised not less than $700 million.
The bogus intelligence chip designer’s inventory completed at 34.46 Hong Kong {dollars} after an preliminary public providing that was priced at 19.60 Hong Kong {dollars}, the highest of an indicative vary. Robust investor demand helped the corporate elevate $717 million by the IPO, with its retail portion subscribed greater than 2,300 instances.
The developer of graphics processing items used to coach and run AI fashions made its debut amid a wave of blockbuster Chinese language listings within the sector, which has emerged as one in all hottest themes in international fairness markets. Aside from the surging investor curiosity in all issues AI, China’s push to help homegrown expertise has additionally boosted sentiment.
Shanghai Biren’s sturdy begin will possible augur properly for two different AI-related shares—MiniMax Group Inc. and Information Atlas Expertise JSC Ltd., higher referred to as Zhipu—which can be set to record within the Asian monetary hub subsequent week. Individually, Baidu Inc.’s AI chip unit confidentially filed for a Hong Kong IPO on Friday.
As the primary GPU-focused inventory to record in Hong Kong, Shanghai Biren “enjoys shortage worth and excessive market consideration,” in keeping with Kenny Ng, a strategist at China Everbright Securities Worldwide Co. “The trade is in a flourishing stage, with many companies striving for breakthroughs and vital development potential.”
Shanghai Biren’s inventory soared practically 119% intraday earlier than paring beneficial properties. Even so, the first-day efficiency at shut was the very best since Kuaishou Expertise’s shares surged 161% of their buying and selling debut in early 2021. That’s bearing in mind Hong Kong listings that raised $700 million or extra.
Broadly, listings of this dimension within the monetary hub between 2020 to 2025 generated a weighted-average acquire of practically 23% on their first day, in keeping with information compiled by Bloomberg.
In the meantime, debuts by Chinese language chipmakers this yr on the mainland have been much more spectacular.
Final month in Shanghai, MetaX Built-in Circuits Shanghai Co. soared 693% on its first day of buying and selling, monitoring Moore Threads Expertise Co.’s stellar debut earlier. The companies, together with Shanghai Biren, are a part of China’s “4 Little Dragons” within the GPU house—seen as contenders to choose up market share left by Nvidia Corp.’s retreat.
Based in 2019 by Zhang Wen, former president of SenseTime Group Inc., Shanghai Biren has been gaining traction amongst main Chinese language companies. In 2022, it claimed “setting a brand new file in international computing energy” with its first general-purpose GPU.
A significant setback got here only a yr later when the agency was added to a U.S. commerce restriction record requiring exporters acquire a authorities license earlier than delivery to Biren. Washington argued its chip curbs are essential to preserve superior expertise out of China’s army palms.
In its prospectus, Shanghai Biren mentioned that proceeds from the providing can be used towards analysis and improvement of its computing options. The corporate posted a 1.6 billion yuan ($228.9 million) internet loss within the first six months of the yr.
China’s ambitions to develop its at-home chips sector have accelerated this yr in a bid to scale back its reliance on international gamers given growing commerce tensions. Officers are actually contemplating a package deal of incentives value as a lot as $70 billion to bankroll the sector.
DeepSeek, a Hangzhou-based startup that shocked the trade with its R1 reasoning mannequin a yr in the past, this week printed a paper outlining a extra environment friendly method to creating AI, illustrating Chinese language efforts to compete with the likes of OpenAI regardless of an absence of free entry to Nvidia chips. Such publications from DeepSeek have foreshadowed the discharge of main fashions prior to now.
This story was initially featured on Fortune.com
