Shares of Moore Threads Technology Co, dubbed by analysts as “China’s Nvidia”, soared on debut in Shanghai on Friday, on bets the US-blacklisted startup will benefit from Beijing’s drive to boost domestic chip manufacturing.
The stock opened at 650 yuan ($91.91), more than five times its initial public offering (IPO) price of 114.28 yuan a share.
Beijing has stepped up approval of IPOs by semiconductor firms in a push towards tech self-sufficiency, with Washington restricting advanced chip exports to China in a bid to curb its development of AI and military capabilities.
Moore Threads, which makes graphics processing units (GPUs) for artificial intelligence computing, could become a key force in accelerating China’s efforts to replace foreign chips with local technology, brokerage Sinolink Securities said in a report initiating coverage with a “buy” rating on the stock.
“The era of AI is driving rapid expansion in GPU demand,” Sinolink Securities analyst Fan Zhiyuan said. Sinolink Securities had set a target price for Moore Threads of 182.25 yuan.
The company last week raised nearly 8 billion yuan ($1.13 billion) by selling shares publicly.
Its performance on Shanghai’s STAR Market is being closely watched amid worries about stretched tech valuations. A strong debut for the Beijing-based company, founded in 2020 by former Nvidia China executive Zhang Jianzhong, would bode well for a growing number of homegrown semiconductor firms eyeing listings as they ride on China’s efforts to reduce reliance on foreign chip suppliers.
The Shanghai Stock Exchange has accepted a slew of IPO applications this year from chipmakers, including MetaX Integrated Circuits (Shanghai), SJ Semiconductor and Xiamen UX IC.
Chinese tech giants, including Huawei, Alibaba, and Baidu, have also stepped up investments in AI chip development, as China restricted Nvidia’s chip sales in the country.
Moore Threads, whose IPO was priced at 123 times 2024 sales, expects 2025 sales to jump as much as 242% to 1.5 billion yuan, as it joins several other Chinese start-ups seeking to fill Nvidia’s void.
China’s SSE STAR Chip Index index currently trades at 118 times earnings, compared with a multiple of 12 for the Shanghai Composite Index.
Reuters
