DeepSeek Rally Sparks a Revival in Chinese Tech Financing

In a striking turnaround, Chinese technology companies are capitalizing on a DeepSeek-inspired rally that has unlocked fresh avenues for fundraising in the stock market. The recent surge, powered by a combination of innovative momentum and supportive government signals, has provided an impressive boost to firms previously hampered by capital market constraints.

Major Developments

Several prominent companies have recently taken advantage of the more favorable investment climate:

• UBTech Robotics Corp.: Announced a share placement aimed at raising funds for expanding research, development, and overall business operations, contributing significantly to the sector's momentum.
• Black Sesame International Holding Ltd.: The chipmaker is in the process of a substantial fundraise, even though its shares have experienced a slight decline of approximately 9% this year.
• XtalPi Holdings Ltd.: This innovative AI drug-discovery firm is also engaged in a fundraising initiative, with its shares surging over 30% year-to-date.
• Beijing Fourth Paradigm Technology Co.: Earlier in the month, the AI company raised about $180 million through a strategic placement.

A Shifting Landscape

The renewed confidence in the Chinese tech sector is evident as the Hang Seng Tech Index has rallied 23% this year. Analysts point to several factors contributing to this positive transformation:

• Investor Optimism: With the introduction of DeepSeek's influence, stocks related to artificial intelligence are experiencing robust investor interest.
• Support from Beijing: President Xi Jinping’s recent meetings with influential entrepreneurs, such as Alibaba Group co-founder Jack Ma, signal the government’s renewed support for a historically underrated private sector.
• Market Rebound: The funding environment, which had been volatile following regulatory crackdowns and international tensions, has shown marked improvement, especially in early 2025.

Steve Chow, an analyst at ABCI Securities Co., noted, "In the past few years, capital markets weren’t too positive. Previously, many companies struggled to secure funding, but today the window has opened wide."

Looking Ahead

Overall, Chinese tech firms have raised more than $1 billion globally through placements this year, with a significant portion of that capital being attracted in February. This trend is indicative of a broader recovery in a sector that once faced severe headwinds from regulatory pressures and international disputes.

The DeepSeek-driven rally has not only revitalized investor interest but also paved the way for a more robust and resilient funding environment, marking an exciting new chapter for Chinese technology companies.