Nvidia Rival Moore Threads Warns of Risk after 723% IPO Surge Amid China's Chip Push

Chinese chipmaker, Moore Threads Technology Co., saw its stock rise 723% in the first week after its initial public offering on the Shanghai Stock Exchange. The stock began trading on December 5 at ¥114.28 and closed at ¥941.08 on December 12. At the same time, the broader CSI 300 Index, which tracks the top 300 stocks by size on the Shanghai and Shenzhen stock markets, was mostly flat.Claim 50% Off TipRanks Premium and Invest with Confidence Unlock hedge-fund level data and powerful investing tools designed to help you make smarter, sharper decisions Stay ahead of the market with the latest news and analysis so your portfolio is always positioned for maximum potential Following the sharp gain, the company filed a notice warning investors about potential trading risks. It stated that the share price had climbed too fast in a short span and could face a drop. The company also reminded investors that it has not yet made a profit and that its new products are still in early use. New Chips and Strong Demand Moore Threads, which is portrayed as a potential China-based rival to Nvidia (NVDA), plans to reveal its next group of graphics chips at a launch event in Beijing on December 19 and December 20. These products are based on the company's next-generation GPU system. So far, none of the new chips has produced revenue. The chipmaker is part of China's broader effort to build local tech firms, as U.S. trade limits have made it harder for companies to buy top chips from Nvidia. That has increased interest in China-based chip stocks like Moore Threads, Cambricon Technologies (PC:CAMBC), and Huawei Technologies. The IPO drew strong demand from local traders. The retail part of the offering was oversubscribed by nearly 2,750 times. That puts it ahead of other large IPOs in China since 2019. For context, Semiconductor Manufacturing International Corporation (SMIC) had a 202% jump on its first day in 2020. We used TipRanks' Comparison Tool to align a few of the major U.S. chip producers to gain a broader perspective on the industry and on each stock in particular. In the list, you can find names such as Micron (MU), Advanced Micro Devices (AMD), Intel (INTC), and Broadcom (AVGO).