Chinese technology companies are seizing the opportunity to boost stock financing, driven by a $1 trillion rally fueled by AI firm DeepSeek and a perceived shift in Beijing’s stance toward its once-struggling tech sector. This week, several companies, including robotics maker UBTech Robotics Corp., chipmaker Black Sesame International Holding Ltd., and AI drug discovery firm XtalPi Holdings Ltd., announced plans to raise up to HK$4.2 billion ($546 million) through share placements. These funds will be used for purposes such as research and development and business expansion. Earlier this month, AI company Beijing Fourth Paradigm Technology Co. also raised approximately $180 million through a similar placement.
The move comes at a time when the investment climate in China’s tech industry has notably improved, spurred by the surge in stock prices of companies linked to cutting-edge technologies like artificial intelligence. DeepSeek’s market impact has fueled investor optimism, further bolstered by President Xi Jinping’s recent meeting with high-profile entrepreneurs, including Alibaba Group co-founder Jack Ma. This meeting was widely interpreted as a sign of Beijing’s growing support for the private sector, which has long faced regulatory scrutiny.
“The capital markets were not very positive in recent years,” noted Steve Chow, an analyst at ABCI Securities Co. “Companies that previously struggled to raise money now find the window has opened.”
UBTech and XtalPi have seen their stock prices surge by more than 70% and 30%, respectively, this year, while Black Sesame’s shares have dropped around 9%. Meanwhile, the Hang Seng Tech Index has risen by 23% year-to-date.
The funding environment for Chinese companies has been unstable in recent years, particularly after Beijing’s crackdown on tech giants, starting with the cancellation of Ant Group’s IPO. Geopolitical tensions with the United States, along with increasing sanctions on Chinese firms, further strained conditions.
However, signs of recovery have emerged this year. Chinese companies have raised more than $1 billion globally through stock placements so far in 2025, with the bulk of the funds raised in February alone.
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