Original author: Dong Jing
Source: Wall Street Journal
China's AI large model sector staged a counter-trend surge in the Hong Kong stock market.
Zhipu has experienced its first lock-up expiration since going public, and the market’s usual “lock-up expiration means price drop” logic has completely failed—on the day, the stock surged over 19%, while MiniMax rose approximately 17% in tandem. Analysts note that the large-scale lock-up release did not trigger a liquidity panic, as major institutional investors collectively signaled long-term holding intentions, signaling a growing systemic recognition of Chinese AI model companies by mainstream Wall Street capital.
Meanwhile, Wall Street Journal article reported that JPMorgan raised its target price for Zhipu to HK$2,000 from HK$1,800, maintaining an "Overweight" rating; Goldman Sachs, Bank of America, and Citigroup also issued "Buy" ratings for MiniMax during the same period.
The strong performance of the two large models is a microcosm of the overall surge in Hong Kong’s technology sector. Today, the Hang Seng Tech Index opened higher and continued to rise throughout the day, climbing nearly 5%. Alibaba surged over 12%, Hua Hong Semiconductor rose over 10%, Lenovo Group increased over 9%, SMIC and Kuaishou both gained over 8%, and Tencent Holdings spiked more than 4% at its peak.
According to China Securities Journal, analysts believe that this strong performance in the Hong Kong stock market is driven by two factors: first, Hong Kong stocks are undervalued and attractive; second, global memory chip sectors have continued to suffer significant declines, prompting capital flows out of these sectors into Hong Kong stocks. Meanwhile, People’s Bank of China Governor Pan Gongsheng delivered a speech at the “Hong Kong Fixed Income and Monetary Summit and Bond Connect Forum,” outlining measures in four areas: deepening financial market connectivity, supporting the prosperity of Hong Kong’s capital markets, consolidating Hong Kong’s position as an offshore RMB hub, and maintaining Hong Kong’s financial stability—providing policy-level support for market sentiment.
The lock-up spell has failed: Institutions collectively declare, market completes value reassessment
ZhiPu's recent lock-up expiration market performance has broken the long-standing expectation in the A-share and Hong Kong stock markets that "lock-up expiration always leads to a price drop."
The total volume of restricted shares being unlocked in this Zhipu release is 25.6816 million shares. JSC International Investment Fund SPC, a fund under Beijing Financial Holdings Group, along with investment firms WT Asset Management and Optimas Capital Limited, as well as early shareholders and cornerstone investor Lingyun Guang Technology Co., Ltd., have all expressed their intent to hold long-term.
On the MiniMax side, its largest strategic shareholders, Alibaba and miHoYo, also clearly expressed long-term confidence in late June. MiniMax’s founding team voluntarily set a 12-month lock-up period, exceeding the industry-standard six months, with the first lock-up release excluding the founding team and employee equity holdings.
From the market perspective, the significant gain on that day was not merely driven by short-term trading sentiment, but rather a concentrated release following the market’s reassessment of the company’s long-term value and a clear signal from capital participants. Several key institutional investors publicly stated their intention to continue holding rather than selling off their shares before and after the lock-up expiration, effectively alleviating market concerns about a liquidity panic.
JPMorgan's upgrade provided important fundamental support for this market rally. Wall Street Journal article stated that JPMorgan raised its target price for Zhipu through December 2026 from HK$1,800 to HK$2,000, maintaining a "Buy" rating, with the core rationale being that GLM-5.2 strengthens the argument that open-weight commercialization can generate significant option value for leading model providers.
JPMorgan also noted that, based on current valuations, the market has largely priced in Zhipu's year-end $1 billion ARR guidance; remaining upside depends on whether its strong open-weight models can achieve scale through external infrastructure and distribution channels.
On MiniMax, Goldman Sachs, Bank of America, and Citigroup all issued "Buy" ratings during the same period, which is uncommon in today’s market environment, where the AI sector is becoming increasingly divided.
Goldman Sachs has set a target price of HK$860 per share, with its report focusing on changes in the pricing environment for China’s AI industry. Goldman Sachs noted that DeepSeek V4 will introduce differentiated pricing during peak hours, with API rates during peak times being twice those during off-peak periods—this represents an early signal of the industry moving away from aggressive price wars toward rationalization since late April 2026. Against this backdrop, MiniMax’s M3 model achieves significantly higher gross margins than its peers, thanks to a higher proportion of self-built optimized computing power and an efficient architecture with smaller activation parameters.
Bank of America's target price is HK$500 per share. The report highlights a significant shift in MiniMax's revenue structure: the company's revenue has transitioned from approximately 70% coming from consumer-facing products last year to a growing share from enterprise and cloud API services, which are now prioritized at a higher strategic level. On the profitability front, the previous-generation model, M2.7, achieved a reasoning profit margin exceeding 40%. Bank of America expects long-term profit margins to remain stable through continued improvements in infrastructure efficiency. Regarding compute access, MiniMax secures compute resources through partnerships with global cloud providers and emerging cloud vendors, delivering localized overseas compute services to international users, and continues to maintain stable access to compute capacity.
Citigroup has set a target price of HK$533 per share, noting that the current stock price implies a 53.8% expected upside, and anticipates MiniMax's revenue growth to remain strong, with its upcoming next-generation video model poised to be a key catalyst for shifting market sentiment.