Alibaba-Backed Chinese AI Startup Files for Hong Kong IPO
Shanghai-based MiniMax, which also counts Tencent as an investor, was valued at around $4 billion after a recent financing round and is targeting a stock-market debut as soon as this year, one of the people said.
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Yahoo
26 minutes ago
- Yahoo
What the China export easing means for Nvidia, AMD, and other chips stocks
Nvidia (NDVA) and AMD (AMD) may soon get the green light to sell AI chips to China again, potentially reviving a key growth market. The US government is reportedly considering loosening export restrictions, which could allow the tech giants to resume sales of some lower-end AI chips to China. This policy shift comes after April's export ban blocked chips such as Nvidia's H20 AI accelerator and AMD's MI308. 'This is a game changer,' Dan Ives, managing director of Wedbush Securities, told Yahoo Finance. 'Nvidia stands to gain billions in annual revenue from China, and every Nvidia supplier is going to benefit, as well as second and third derivative plays.' Bank of America (BAC) raised its price targets for Nvidia and AMD to $220 and $175, respectively, in anticipation of license approval. Favorable regulation could boost Nvidia's earnings per share by 5%-7% and AMD's by 3%-5%, its analysts estimate. But it's not just Nvidia and AMD that stand to gain. "It's a silver bullet positive for the AI buildout sector,' Ives said. If China's cloud and data center buildouts ramp back up, companies like Broadcom (AVGO) and Marvell Technology (MRVL), whose custom chips support AI infrastructure, could benefit. Credo Technology Group (CRDO), a high-speed interconnect supplier, may also see demand rise alongside broader server deployments. All three stocks carry a Buy rating from BofA. The clearest beneficiaries may be at the heart of chip manufacturing. Taiwan Semiconductor Manufacturing Company (TSMC), which produces Nvidia and AMD's chips, and Samsung Electronics (SSNLF), a key supplier of high-bandwidth memory, are well-positioned to capture a rebound. Read more: How does Nvidia make money? 'If I'm pointing to derivatives, I'm pointing to Samsung and TSMC,' Matt Bryson, managing director of research at Wedbush Securities, told Yahoo Finance. 'They're literally working on the parts Nvidia and AMD are shipping.' Bryson said that before April's export ban, Chinese server build activity was the 'number one positive inflection' the industry was watching. The momentum stalled in the second quarter, but could quickly return if policy changes are confirmed. The semiconductor market is rapidly expanding as AI advances. Gaining approval and reopening the key Chinese market, even partially, shifts sentiment across the sector. Nvidia CEO Jensen Huang estimated the Chinese AI market is worth $50 billion. Still, the exact effect on balance sheets will be hard to pin down in the near term. Nvidia's first quarter earnings reported a $2.5 billion drop in China revenue and a $4.5 billion inventory write-off. An additional $8 billion loss is anticipated in the second quarter. The semiconductor market is rapidly expanding as AI advances. Gaining approval and reopening the key Chinese market, even partially, shifts sentiment across the sector. Nvidia CEO Jensen Huang estimated the Chinese AI market is worth $50 billion. 'China is one of the best areas they [AMD] could break into,' Ives said. Bryson pointed out that even if the chipmakers get the green light to resume shipments and see some revenue bounce back, it's a big question mark whether the demand is even still there. Chinese customers might have already found other suppliers or simply moved on. Francisco Velasquez is a Reporter at Yahoo Finance. He can be reached on LinkedIn and X, or via email at Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
28 minutes ago
- Forbes
China Market Update: EV Anti-Involution Drives Gains As Biotech Breaks Out
CLN Asian equities had a good day as Thailand, Indonesia, and Pakistan outperformed, while India posted a small loss. Hong Kong bounced around the room, while Shanghai and Shenzhen grinded higher, going from the lower left to the upper right. It was a fairly quiet night, as Premier Li and the State Council's meeting on 'strengthening the domestic big cycle' and limiting EV price wars, i.e. 'anti-involution', were front page news. The implications of the government curtailing 'overcapacity' in the auto, steel, cement, E-Commerce, and solar industries are significant for corporate balance sheets, ending domestic deflation, and China not exporting deflation. Li Auto gained +9.73% after announcing that a new model is open for pre-sales, as Geely Auto gained +4.16%, BYD gained +1.06%, XPeng gained +1.14%, though Xiaomi fell -2.01% and CATL fell -0.27%. Biotech stocks in both Hong Kong and Mainland China continued to outperform overnight, as Akeso gained +10.71% after starting Phase 3 trials for a metastatic colorectal cancer treatment. The space continues to benefit from drug releases, distribution deals, and favorable policy support. BeOne, formerly known as Beigene, gained +10.6%, Jiangsu Hengrui gained +2.06%, Sino Biopharmaceutical gained +5.9%, CSPC Pharma gained +3.58%, and WuXi Apptec gained +2.42%. Internet names were mixed, as Alibaba fell -1.14%, Meituan gained +1.13%, fell -0.16%, fell -0.88%, Kuaishou fell -0.65%, and Tencent Music Entertainment gained +1.78%. South China Morning Post had an article about Meituan complaining about 'irrational competition' from Alibaba and after the latter's entrance into the restaurant delivery space sparked a price war. Another Chinese city announced local plans to curb the price war. Mainland investors bought $236 million worth of Hong Kong-listed stocks and ETFs via Southbound Stock Connect, though Tencent, which gained +0.10% overnight, remains a funding source and was sold by Mainland investors. Hong Kong and Mainland China-listed electronic equipment makers, software, and semiconductor stocks had very strong days. Nvidia's Jensen Huang's China trip and comments on chip sale approvals and the quality of Chinese electric vehicles (EVs) and AI garnered significant attention. According to the China Association of Automobile Manufacturers (CAAM), China's auto exports increased +10.4% year-over-year (YoY) to 3.07 million in June. After the close, the Ministry of Finance (MoF) adjusted the tax rate on ultra-luxury cars with price tags above RMB 900,000 and canceled taxes on used vehicles. China and Australia singed a memorandum of understanding (MOU) to review the China-Australia Free Trade Agreement following Prime Minister Anthony Albanese's six-day trip to China. There was also more media chatter of US-China trade deal percolating. Live Webinar Join us on Tuesday, July 22, 10:00 am EDT for: China Mid-Year Outlook: Trade Deal Loading, Consumption & Innovation Locked In Please click here to register New Content Read our latest article: KraneShares KOID ETF: Humanoid Robot Rings Nasdaq Opening Bell Please click here to read Chart1 Chart2 Chart3 Chart4 Chart5 Chart6
Forbes
28 minutes ago
- Forbes
RCAT Stock To $25?
CHONGQING, CHINA - MAY 11: In this photo illustration, the logo of Red Cat Holdings, Inc. is ... More displayed on a smartphone screen, with the company's red branding and stylized cat face emblem visible in the background, on May 11, 2025, in Chongqing, China. (Photo illustration by) Red Cat Holdings (NASDAQ:RCAT) has experienced a remarkable increase in its stock by 500% over the past year, mainly due to its strategic emphasis on the rapidly expanding drone defense sector. This exceptional growth is fueled by notable military contract achievements, even as the company continues to incur losses. A significant contributor to this success is the U.S. Army's Short Range Reconnaissance (SRR) program, which may enable Red Cat's Black Widow drones to provide up to 5,880 units over five years. Additionally, the company has secured fresh orders for its Edge 130 drones from various U.S. government entities. This increase in demand is further bolstered by a global rise in defense expenditures on drone technology, partly influenced by the conflict in Ukraine. Red Cat's dedication to 'Made in America' drone solutions is proving essential, aligning with national security objectives. The company's strategic alliance with Palantirfor AI navigation and manufacturing optimization, together with its innovative Edge 130 and Black Widow products, is expected to result in a notable growth in anticipated revenues this year, with the Black Widow drone expected to guide the company towards profitability. However, for those seeking upside with a less volatile option than an individual stock, consider the High Quality portfolio, which has outperformed the S&P, achieving over 91% returns since its inception. Separately, check out – D-Wave Quantum: Can QBTS Stock Deliver Another 1,000% Gain? Financial Performance Analysis Red Cat presents a complicated financial scenario with contrasting short-term and long-term trends: Red Cat's current profitability measures are severely unfavorable across all key metrics: These metrics indicate the company's ongoing investment stage as it scales up production capabilities and meets military contract demands. Despite operational losses, Red Cat preserves a robust financial basis: The low debt load affords financial flexibility for growth investments and fulfilling contracts. Valuation Metrics Red Cat's valuation appears high based on traditional metrics, with a price-to-sales ratio of 80x compared to the S&P 500's 3.1x. However, this superficial analysis fails to account for the company's transformation narrative. The valuation becomes increasingly attractive when projected growth is taken into account: Risk Assessment Red Cat Holdings faces significant risks, including operational difficulties in scaling manufacturing to fulfill large military contracts, maintaining rigorous quality control, and managing supply chain vulnerabilities. Market-wise, the company contends with fierce competition, possible changes in defense spending, and substantial customer concentration due to its reliance on government contracts. Moreover, RCAT stock carries considerable market risk, having underperformed significantly compared to the S&P 500 during prior downturns. Financially, ongoing negative cash flow requires continuous access to capital, and timelines for profitability could be impacted by legal challenges, such as class action lawsuits alleging false claims about production capacity and the true value of the SRR contract. Geopolitical elements like defense budget reductions, export limitations, and decreased global tensions also present risks to future growth and market development. Additionally, check out – What's Happening With SBET Stock? The Verdict Red Cat Holdings showcases an intriguing growth narrative within the defense technology arena, with the 500% appreciation in stock price representing both the company's strategic positioning and the larger drone market opportunity. While current financials indicate substantial losses, the strong balance sheet and significant military contracts lay a foundation for anticipated revenue growth. The forward-looking valuation seems reasonable given the potential for growth, though execution risks and market competition are crucial factors for investors to watch closely. Now, we utilize a risk assessment framework while constructing Trefis High Quality (HQ) Portfolio which, with a collection of 30 stocks, has consistently shown strong performance against the S&P 500 over the past four years. Why is that? As a collective, HQ Portfolio stocks have offered superior returns with reduced risk in comparison to the benchmark index; a smoother investment experience, as evidenced in HQ Portfolio performance metrics.
