Zhipu AI shares have surged more than 24-fold since their Hong Kong debut, briefly pushing the company’s market capitalization above HK$1 trillion and placing it among the fastest wealth expansions in the market’s history. The stock’s rapid rise has been driven by enthusiasm around its latest AI model and limited share supply, even as valuation metrics far exceed global peers.
Valuations soar far beyond peers
At current levels, Zhipu’s valuation stands near USD 137 billion against projected 2025 revenue of about USD 1 billion, implying a price-to-sales ratio above 1,280. By comparison, OpenAI’s estimated multiple is around 56 times revenue, while other technology firms trade at significantly lower levels. Based on those benchmarks, Zhipu’s implied valuation range would sit far below its current market capitalization.
The company remains unprofitable, reporting heavy spending on research and development. For every unit of revenue in 2025, more than four were allocated to R&D, leading to a net loss of RMB 4.7 billion.
Early backers and employees see outsized gains
The sharp rally has translated into substantial gains for early participants. Initial backers such as Zhongkechuangxing and Capital Today recorded returns approaching 100 times, while other firms including Junlian Capital and Shunwei Capital secured multibillion–Hong Kong dollar profits.
In total, 57 stakeholders invested RMB 83.6 billion across multiple funding rounds, which grew to roughly HKD 770.8 billion at the June peak, an average return of 85 times. Internal holding platforms controlling about 15 percent of shares have also generated significant paper wealth for employees, with senior engineers reaching holdings worth billions of Hong Kong dollars.
Business model anchored in enterprise ai
Zhipu’s revenue is largely derived from on-premise AI deployments for government agencies, banks, and energy companies. This segment contributed RMB 534 million in 2025, accounting for 73.7 percent of total revenue, with a gross margin of 48.8 percent. Contract values vary widely, ranging from hundreds of thousands to several million yuan annually depending on scale.
Glm-5.2 release drives global attention
Momentum accelerated after the release of the GLM-5.2 model in mid-June. The open-source model, featuring enhanced coding capabilities, gained traction among global developer communities. Discussions among technology leaders highlighted its potential to replace certain proprietary systems, expanding Zhipu’s visibility beyond China.
This international exposure has drawn new market participants and repositioned the company as a publicly traded alternative in the rapidly growing AI sector.
Limited float amplifies volatility
Trading activity has been heavily influenced by a constrained share supply. Of the 430.3 million H-shares issued at listing, most were subject to lock-up agreements, leaving less than 4 percent freely tradable initially. This scarcity contributed to sharp price movements.
That dynamic is set to shift on July 8, when 25.68 million shares—about 5.76 percent of total equity—will be unlocked. The event will increase the free float from 17.35 million shares to around 43.03 million, more than doubling available supply. At late-June valuations, these shares are worth approximately HKD 73.4 billion.
Lock-up expiry poses near-term pressure
Historical patterns in Hong Kong show that stocks often face downward pressure following major lock-up expirations, with median declines of around 4 percent over the following three months. The broader market context adds further uncertainty, with Goldman Sachs estimating about USD 274 billion in lock-up expirations across Hong Kong over the next year.
Outlook hinges on growth and liquidity
JPMorgan recently raised its target price to HK$1,800 and maintained an overweight rating, citing expectations of revenue growth exceeding 500 percent in 2026 and potential profitability by 2028. The bank pointed to improved pricing and capabilities in the GLM-5.2 model as key drivers.
Still, near-term performance will depend on whether global interest in the model converts into sustained revenue and whether the market can absorb the surge in tradable shares without significant price disruption. Traders are now closely watching both adoption trends and post-lock-up price behavior as tests of the company’s elevated valuation.
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