Zhipu AI Jumps Nearly 12% in Hong Kong Debut Ahead of MiniMax IPO
Leading Chinese artificial intelligence startup Zhipu AI surged on its Hong Kong stock market debut on Thursday, a day before rival MiniMax is set to go public, marking a major test for China’s rapidly expanding generative AI sector.
Shares in Zhipu AI, which operates the Z.ai platform, climbed as much as 11.8% in early trading after its heavily oversubscribed initial public offering (IPO) raised HK$4.35 billion (US$558 million).
The back-to-back listings make Zhipu and MiniMax the first two publicly traded companies among China’s so-called “six AI tigers” — a group of generative AI startups competing with tech giants like Alibaba and ByteDance.
No Immediate Profits Expected, Analysts Say
The IPOs come ahead of any public listing announcements from top US AI startups such as OpenAI (maker of ChatGPT) and Anthropic (creator of Claude).
Despite strong investor demand, analysts caution that profitability is still a long way off.
“Zhipu is honoured to stand at this historic juncture as a representative of China’s large model sector,” said Zhipu chairman Liu Debing during the company’s listing ceremony.
Zhipu AI, founded in 2019, is one of China’s largest providers of large language model (LLM) services to corporate and government clients.
The company said proceeds from the IPO will be used to:
- Develop general-purpose AI models
- Strengthen core algorithms
- Expand system and computing infrastructure
MiniMax Targets Global Consumers
MiniMax, founded in 2022, focuses on consumer-facing AI tools, especially outside China. Its products span:
- AI-generated speech
- Music
- Video
- Text-based chatbots
The company is scheduled to debut on the Hong Kong market on Friday.
Optimism — and Bubble Fears — Around Chinese AI
China tech analyst Poe Zhao, founder of the Hello China Tech newsletter, said the IPOs highlight both the promise and the challenges facing Chinese LLM companies.
“These IPOs demonstrate both the revenue potential and the fundamental challenges facing this new generation of AI companies,” Zhao told AFP.
“The high demand definitely reflects broader optimism about Chinese AI.”
An ongoing AI boom has pushed Chinese tech stocks to record highs, though volatility remains as global investors watch closely for signs of an AI bubble.
“Do I think there’s a bubble? Yes,” Zhao said.
“But there’s a difference between a bubble and bubble risk. These companies are extremely capital-intensive.”
China’s AI Market Set to Explode
According to consultancy Frost & Sullivan, China’s large language model market is expected to grow to 101.1 billion yuan (US$14.5 billion) by 2030.
Momentum accelerated in January 2025, when Chinese startup DeepSeek stunned global markets with a low-cost, high-performance reasoning model, challenging assumptions of US dominance in AI.
However, geopolitical and legal challenges persist.
US Blacklists and Lawsuits Add Pressure
- In 2024, Washington placed Zhipu AI on an export control blacklist over national security concerns
- Zhipu is backed by Chinese tech giant Tencent
- Disney, Universal, and other US entertainment companies are suing MiniMax for copyright infringement
Despite these hurdles, investor enthusiasm remains strong.
Chips, Capital, and China’s AI Strategy
Beijing has reportedly encouraged AI firms to adopt homegrown microchips due to ongoing US restrictions on advanced Nvidia AI chips, which are critical for training large models.
Investor confidence in China’s semiconductor ambitions recently sent shares of Moore Threads and MetaX soaring during their IPOs.
Earlier this month, Baidu announced that its AI chip unit Kunlunxin had filed for a Hong Kong listing.
Long Road to Profitability
Industry experts say profitability will depend on two major shifts:
- Significantly lower computing costs
- Massive growth in AI demand
“Running a foundational model company costs a lot and takes a lot of time,” said Shengyun Lu, founder of LSY Consulting.
“IPOs help fund long-term research, but early investors are also looking for exits.”
