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Shares in Chinese semiconductor firm Moore Threads surged dramatically on Friday after the company made its stock market debut, reflecting strong investor confidence in China’s ambition to build a domestic artificial intelligence chip industry.
The company, which develops advanced processors used to train and operate AI systems, raised $1.1 billion in its initial public offering as investors looked to back a homegrown alternative to US chip giant Nvidia, which has been restricted from selling its most powerful products to China.
Moore Threads set its IPO price at 114.28 yuan per share and saw its stock jump as much as 502 per cent to 688 yuan shortly after trading began, before settling about 420 per cent higher by the end of the morning session.
Demand for the shares was overwhelming, with orders reportedly exceeding available supply by more than 4,000 times, underlining the intense appetite for Chinese technology firms working in strategic sectors.
Nvidia currently dominates the global market for graphics processing units, which are central to the development of artificial intelligence, fuelled by worldwide excitement around the technology.
However, the United States has barred the company from exporting its most advanced chips to China, citing national security concerns and the risk that such technology could strengthen Beijing’s military capabilities.
As a result, Chinese authorities have been encouraging technology firms to adopt domestic alternatives, effectively squeezing Nvidia out of one of the world’s largest potential markets.
Dilin Wu, a research strategist at Pepperstone, said the level of enthusiasm surrounding the IPO showed how closely Moore Threads is being watched as a symbol of China’s next-generation chip ambitions.
She said investors were buying into the idea that China can create a serious domestic competitor in the GPU space amid global supply pressures. However, much of the excitement also reflected investors’ desire to get in early on what they hope could be a breakout company.
Moore Threads is among a small number of Chinese companies seeking to replace foreign-made GPUs with domestic designs.
Rui Ma, founder of the Tech Buzz China newsletter, said the company plays an important role in the industry but is not yet the leader, particularly when compared with larger rival Cambricon.
Even so, Moore Threads’ listing on Shanghai’s tech-focused STAR market valued the company at close to $7.6 billion, highlighting expectations that it could become a “local champion” in the sector.
Part of the attention surrounding the company also stems from its founder having previously led Nvidia’s operations in China, adding to the perception that the firm could challenge international rivals.
However, industry specialists caution that it is unlikely Chinese manufacturers will match Nvidia’s technical capability within the decade, given the complexity of designing AI chips, producing high-bandwidth memory and achieving the ultra-precise manufacturing standards required.
Despite these hurdles, Ma noted that China’s domestic market alone is large enough to sustain multiple homegrown chipmakers.
Shares in Cambricon have more than doubled over the last year, and reports suggest the company plans to sharply increase its AI chip output by 2026.
Nevertheless, Wu warned that soaring valuations could signal speculative behaviour, adding that exaggerated expectations could lead to abrupt sell-offs if companies fail to deliver on earnings or product development plans.
