Nvidia can barely sell its best chips in China. A product of local competitors competes to fill the void. One of them raised about $900 million to accelerate.
Shanghai Biren Technology is selling HK$7 billion (about $892.5 million) in new shares to boost GPU production. Therefore South China Morning Post. It’s a bet that China cloud and data center buyers will continue to spend and Biren can provide them.
Conditions
Biren will issue 153 million new shares at HK$46.2 each. That’s a 9.9 percent discount to Friday’s close. The company only went public in Hong Kong in January, and its shares have risen nearly 150 percent since then. Investors were more cautious this week. Shares rose in early trading before closing 5.4 percent lower on Monday.
Most money has a clear purpose. Biren said 60 percent will fund the commercialization and mass production of next-generation general-purpose GPUs. Another 20 percent goes to research and the rest to investments and working capital. The growth is aggressive, but so is the burn. The company had already spent more than 70 percent of its listing proceeds by the end of June.
Why now?
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The timing is no coincidence. Washington’s export controls Keep Nvidia’s most advanced AI chips away from Chinese customers. This has left a lucrative void at home, and a slew of local firms are rushing to fill it. It competes with Biren Moore Threads, MetaX and Cambriconall chasing the same buyers.
Demand, to say the least, is not a problem. “Customers such as cloud service providers, AI data centers and enterprise customers are significantly expanding their AI computing deployments,” Biren said in his filing. It viewed growth as a way to keep pace, claiming it needs “adequate capital to ramp up production” of its next GPUs to fulfill orders on time.
Crowded race
Money follows a fast moving field. MetaX, Shanghai Companion An Nvidia competitorsaid he would apply for the Hong Kong listing in June. This comes months after the Shanghai STAR Market debuted. Kunlunxin, Baidu’s chip division, is said to be chasing a bigger figure. It wants a valuation of at least 100 billion yuan, about $14.7 billion, for its Hong Kong float.
None of this makes the One Nvidia. Its chips remain one step behind the market leader and China’s most powerful AI accelerators yet special designs Not general purpose GPUs from Huawei et al.
But “good enough” and “Made in China” are the real deal as foreign supply is stifled. This equates to almost $900 million in fresh capital. The gap left by Nvidia is all opportunity.
