SHANGHAI, Dec 17 (Reuters) – MetaX Integrated Circuits surged 700 percent in its Shanghai market debut as the Chinese AI chip maker benefited from a strong boost sparked by Beijing’s efforts to reduce reliance on chips from U.S. firms Nvidia ( NVDA ) and Advanced Micro Devices ( AMD ).
Founded by former AMD executives, MetaX raised about $600 million in an initial public offering last week, days after larger rival Moore Threads debuted with a 400 percent pop.
MetaX opened at 700 yuan a share in Shanghai from an IPO price of 104.66 yuan, before rising to 895 yuan, defying lingering AI bubble concerns in other markets. The stock ended the trading session at 829.9 yuan, up 693%.
“It’s another IPO story in China that turns a crow into a phoenix,” said fund manager Yang Tingwu of Tongheng Investment.
Rising prices “create huge arbitrage opportunities” for pre-IPO investors, Yang said, and “we’re probably seeing the stock peak in the next five years.”
Artificial intelligence (AI) chipmakers are rushing to sell shares in China to capitalize on interest generated by a government push to boost local manufacturing to compete with the US
“AI and semiconductors are key areas of competition in the Sino-US technology rivalry,” Guotai Haitong Securities said in a report ahead of MetaX’s listing. “Against the backdrop of geopolitical tension, AI chipmaking has huge growth potential,” as China seeks to achieve self-sufficiency.
Researchers Frost & Sullivan predict that sales of AI chips in China will exceed $189 billion by 2029, up from $54 billion in 2026.
MetaX, which makes graphics processing units (GPUs), raised 4.2 billion yuan ($596 million) last week in a share sale that was more than 4,000 times oversubscribed by retail investors.
The IPO – China’s sixth largest so far this year, according to KPMG – valued the money-losing startup at 50 times its 2024 sales. That compared with a multiple of 34 for Nvidia and 14 for AMD, MetaX said in a pre-listing statement.
MetaX’s debut catapulted the value of the five-year-old startup to more than 300 billion yuan ($42.58 billion) and boosted the fortune of founder and majority shareholder Chen Weiliang, 49.
After working for AMD Shanghai for 13 years, Chen founded MetaX with the mission to “contribute to China’s national rejuvenation and prosperity.” The founding team also included Peng Li and Yang Jian, both former AMD engineers.
“The company is a leading GPU manufacturer in China due to its AMD gene,” Huajin Securities analyst Li Hui said in a report ahead of MetaX’s listing.