Chinese technology companies are seizing a newfound opportunity to raise capital, buoyed by a DeepSeek-driven rally that has propelled the sector’s market value by $1 trillion and an increasingly supportive stance from Beijing toward the tech industry. This week, a number of firms from robotics to AI and chipmaking have announced share placements, targeting a combined total of HK$4.2 billion ($546 million) to fund research and development, business expansion, and more.
Key Players Raising Funds
Among the companies capitalizing on this wave of investor optimism are UBTech Robotics, a leading robotics firm, Black Sesame International Holding, a chipmaker, and XtalPi Holdings, an AI-powered drug-discovery company. Additionally, AI startup Beijing Fourth Paradigm Technology raised about $180 million earlier this month through a similar placement. These efforts highlight the increasing attractiveness of Chinese tech stocks as the sector recovers from its previous struggles.
DeepSeek-Fueled Stock Surge and Investor Sentiment Shift
The catalyst for this surge in capital-raising activity is the meteoric rise in stock prices of Chinese tech firms, spurred by a stock-buying frenzy fueled by the success of artificial intelligence firm DeepSeek. The DeepSeek rally has boosted investor sentiment and led to heightened demand for stocks in AI-related companies, as the technology gains prominence across industries.
Further bolstering investor confidence was a recent meeting between President Xi Jinping and high-profile entrepreneurs, including Jack Ma, co-founder of Alibaba Group Holding Ltd. This meeting was seen as a sign that Beijing is offering its backing to the private sector, which had previously faced scrutiny and regulatory crackdowns.
Raising Funds Amid Volatile Climate
The financing environment for Chinese technology companies has been volatile in recent years, particularly after Beijing’s crackdown on the tech sector, which began with the cancellation of Ant Group Co.’s IPO. In addition to domestic regulatory hurdles, tensions between China and the U.S., including sanctions against Chinese firms, further strained the ability of these companies to raise capital.
However, this year marks a shift, with Chinese companies beginning to raise substantial amounts of money through stock placements. According to Bloomberg data, over $1 billion has been raised globally by listed Chinese firms this year, with the bulk of the funds being raised in February alone.
Performance of Key Firms
Some of the companies raising funds have seen impressive stock gains this year, with UBTech Robotics and XtalPi Holdings posting gains of over 70% and 30%, respectively. However, Black Sesame has faced a more challenging year, with its stock price down by about 9%. Despite this, the broader Hang Seng Tech Index has surged by 23% in 2025, reflecting an overall positive shift in market sentiment toward the sector.
A Changing Landscape for Chinese Tech
The changes in investor sentiment and the funding environment mark a significant shift from the previous few years, when access to capital was limited due to political and regulatory pressures. As the Chinese tech sector continues to recover, it’s likely that more companies will look to capitalize on this favorable investment climate.
In conclusion, the DeepSeek-driven rally and Beijing’s shifting stance toward the private sector have helped open a window for Chinese tech firms to secure much-needed capital. With a growing number of placements and a more supportive policy environment, the sector’s outlook is becoming more optimistic, potentially heralding a new phase of growth for Chinese technology companies.
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