Tech pivot: Chinese AI, chip start-ups court global investors with Hong Kong listing plans

More Chinese artificial intelligence firms and chipmakers are turning to Hong Kong for fundraising, testing the appetite of global investors following stellar onshore debuts of graphics processing unit (GPU) developers Moore Threads Technology and MetaX Integrated Circuits.\nGigaDevice Semiconductor is a step closer to its Hong Kong initial public offering (IPO) after passing a listing hearing, according to bourse operator Hong Kong Exchanges and Clearing (HKEX). The company is expected to reactivate its IPO application on the bourse’s website before Saturday after its previous filing, dated December 17, lapsed.\nJoining the rush are some of China’s most prominent AI and semiconductor hopefuls, including MiniMax and Zhipu AI – dubbed the “new AI tigers of China” – Montage Technology, OmniVision Integrated Circuits, as well as GPU developers Biren Technology and Iluvatar CoreX Semiconductor.\nThey are using Hong Kong as “a step towards broadening their investor base and expanding capital-raising channels for research and development”, said Gary Ng Cheuk-yan, senior economist at Natixis Corporate and Investment Bank. “It is a good prerequisite for any future overseas expansion plan, especially given the higher valuation of tech in Hong Kong now.”\n\nGigaDevice, which listed in Shanghai in 2016, and Montage, which joined Shanghai’s Star Market in 2019, are each aiming to raise as much as US$1 billion from Hong Kong listings as early as January, according to a Bloomberg report citing unnamed sources.\nBiren is also seeking to raise about US$600 million through an IPO, the report said.\nMontage plans to issue up to 130.2 million ordinary overseas shares for its secondary Hong Kong listing. The company has been undergoing the listing hearing process since December 15, according to its filings with the Shanghai Stock Exchange.\nOmniVision, which listed in Shanghai in 2017, plans to use its Hong Kong proceeds to recruit and retain research and development (R&D) talent, build R&D facilities and expand in global markets, its filing with HKEX said.\nBiren planned to invest its funds in its intelligent computing hardware and software platform upgrades, as well as the commercialisation of its intelligent computing solutions.\nIluvatar CoreX aimed to use its proceeds for R&D and commercialisation of its general-purpose GPUs over the next five years, expanding its R&D team, as well as for sales and marketing.\nChinese media reported that MiniMax, Zhipu AI and Montage have already cleared listing hearings at the Hong Kong stock exchange. However, no related documents have appeared on the bourse’s website so far.\n\nUnder Hong Kong stock exchange rules, secondary listing candidates and tech start-ups using the specialist tech channel can submit their listing applications confidentially.\nTheir listing plans follow the success of Moore Threads, which raised 8 billion yuan (US$1.13 billion) and saw its shares soar 425 per cent on their Shanghai debut on December 5. MetaX followed less than two weeks later, raising 4.2 billion yuan and surging as much as 755 per cent intraday.\n“If the newcomers can enrich the tech investment universe in Hong Kong, this is positive in the long term for attracting more capital,” Ng said. “There could also be sector rotation from traditional firms, such as financials and real estate, to tech in Hong Kong.”\n