en.Wedoany.com Reported - Baidu's AI chip subsidiary Kunlunxin plans to list in Hong Kong at a valuation of $50 billion, and is asking potential IPO investors to commit to purchasing its semiconductors, a relatively rare practice.
Kunlunxin's target valuation represents a significant increase from earlier figures. Earlier this month, the South China Morning Post reported a valuation of $14.7 billion, while TrendForce cited a figure of HK$100 billion (approximately $12.8 billion) in May. Reuters could not independently verify the report.
If the practice of linking chip purchase commitments to IPO allocations is confirmed, it would blur the line between investors and customers, resembling the "circular financing" structure warned against by the Bank for International Settlements (BIS). The BIS noted that arrangements where chip manufacturers hold equity in AI labs, which in turn commit to purchasing their products, often have "insufficiently disclosed" terms.
Kunlunxin confidentially filed for a Hong Kong listing in January and is simultaneously seeking a dual listing on Shanghai's STAR Market. The company has hired CICC, Citic Securities, and Huatai Securities as lead underwriters. Founded in 2012 as Baidu's in-house chip division, Kunlunxin is a key component of Baidu's strategy to become a full-stack AI company. Hong Kong has become a primary listing venue for Chinese AI companies, with equity capital markets raising nearly $44 billion in the first half of 2026, a five-year high.
The listing comes amid a broader AI financing boom in Hong Kong, involving multi-billion-dollar issuances from companies like CATL, a new funding round for AI developer Zhipu, and a listing plan for optical module manufacturer Zhongji Innolight. SK Hynix has also applied for a U.S. listing, potentially raising $29 billion.
Kunlunxin is transitioning from an internal supplier for Baidu to a third-party chip vendor. External customers contributed over 50% of revenue in 2025, and the company expects to break even that year. The BIS has warned of systemic risks in the financial structure of the AI investment boom, and a chip company requiring its IPO investors to also become its customers exemplifies the kind of entanglement regulators have flagged.
This article is compiled by Wedoany. All AI citations must indicate the source as "Wedoany". If there is any infringement or other issues, please notify us promptly, and we will modify or delete it accordingly. Email: news@wedoany.com
