Baidu chip unit Kunlunxin files for Hong Kong IPO amid China’s push for tech self-reliance

Baidu’s artificial intelligence chip subsidiary Kunlunxin (Beijing) Technology has confidentially applied for an initial public offering (IPO) in Hong Kong, as the search and AI giant becomes the latest to join an investment frenzy amid China’s drive for tech self-reliance.\nThe Kunlunxin prospectus was submitted on Thursday but details such as the size and structure of the IPO had not yet been finalised, Baidu said in a statement on Friday.\nBaidu’s Hong Kong-listed shares rose 7.5 per cent to HK$141.30 as of the noon trading break.\n“The US tech blockade has made it even more urgent for China to move quickly up the value chain, build indigenous production capability and secure the first-mover advantage in AI,” said Gary Cheuk-yan, senior economist at Natixis Corporate and Investment Bank.\nNg said he saw stronger investor appetite for China’s national tech champions amid the country’s drive for self-reliance, which was helping chip firms gain a higher valuation.\n\nLast year, 20 Chinese semiconductor IPOs raised over 45 billion yuan (US$6.4 billion), with six of them listing in December, according to market data provider CVSource. The entire chip industry raised over 185 billion yuan across 1,419 cases, topping all sectors.\nMore players are joining the wave in 2026. Graphics processing unit (GPU) developer Biren Technology began trading in Hong Kong on Friday after raising HK$4.85 billion (US$623 million), and rival GPU firm Enflame also finished its IPO tutoring, moving towards a listing on the Nasdaq-style Shanghai Star Market.\nBiren and Enflame, together with the Shanghai-listed Moore Threads Technology and MetaX Integrated Circuits, are known as the “Four Little Dragons” of China’s GPU sector.\nBaidu announced on December 7 that Kunlunxin was in the process of a proposed spin-off and listing in Hong Kong.\nKunlunxin’s valuation ranged from US$16 billion to US$23 billion after taking into account industry developments, Jefferies analysts Thomas Chong and Zoey Zong wrote in a note.\nThe company started out as an internal Baidu project focused on intelligent chips and was separated from the parent in April 2021, with a valuation of 13 billion yuan, according to corporate data platform Tianyancha.\nBaidu’s stake in Kunlunxin is currently 59.45 per cent. The tech giant said the extent of its holdings in the chip unit after the IPO was not yet certain.\nKunlunxin launched its first product, the XPU, in 2017, and unveiled a new chip a year later, which Baidu founder and CEO Robin Li Yanhong hailed as China’s “first cloud-to-edge” AI chip.\nThe chip designer is also backed by state-owned investors, including the Beijing Artificial Intelligence Industry Investment Fund and the China Internet Investment Fund. It also won a bid for a mega computing project for telecoms operator China Mobile in late September.\nEarlier, Kunlunxin was reported to be expecting to reach break-even in 2025, swinging from a net loss of 200 million yuan.\n