Xizhi Technology's Hong Kong Shares Soar Over 400% on Debut, Setting a Record

Chinese photonic computing chip company, XigTech, made its debut on the Hong Kong stock exchange today, with its share price soaring by over 400% compared to the issue price, setting the record for the largest first-day increase since Bloomberg's records began in 1985 for Hong Kong IPOs with more than $100 million in funding.

The IPO was priced at 183.2 Hong Kong dollars (the upper limit of the range), opening at 880 Hong Kong dollars. The company raised about 2.5 billion Hong Kong dollars (approximately $323 million) through this issuance. The cornerstone investors included Alibaba Investment, the Singaporean government's investment arm GIC, and Temasek who collectively subscribed for more than 71% of the offering. According to reports from the South China Morning Post, the retail public subscription was oversubscribed by more than 5784 times.

Founded in 2017, XigTech focuses on the development of optical interconnection hardware and photonic computing products. Its core business provides solutions for AI data centers that replace electrical signals with light to transmit and process data, which in theory can achieve higher speeds and lower power consumption. The company claims to be the world's first enterprise to achieve large-scale deployment of hybrid optoelectronic computing and is also the first AI photonic chip enterprise to be listed in Hong Kong.

Behind this IPO craze lies the recent collective eruption of China's optical track. Bloomberg Intelligence analyst, Chen Weian, attributes XigTech's strong performance on the first day to the continuous upward momentum of the "Three Optics of China" — Zhongji Xuchuang, Suzhou TF and Huazhong Zhengyuan — in the past month, believing that as the AI investment cycle continues to expand, the technology hardware sector is in a strong April rebound. Last week, photonic communication tester, Silight Instruments, also saw a massive debut surge of 876% on the Shanghai Stock Exchange, further fueling market sentiment.

XigTech's listing narrative also builds on a long-term market expectation. The company cites forecasts from Frost & Sullivan, stating that the penetration rate of photonic computing chips in China's AI inference market is currently less than 0.5%, but it is expected to reach 20% by 2040. The company plans to use about 70% of the raised funds for R&D, with a focus on chip design technology and photonic computing products.

However, investors also need to face the reality that the company is still in the loss-making phase. The prospectus shows that XigTech's net loss was about 1.3 billion yuan in 2025, with R&D spending of about 480 million yuan and revenue of about 106 million yuan. The company's income is highly concentrated, with the largest customer contributing to the income proportion of more than 40%.

For investors, the core issues that need to be followed at the moment are whether photonic computing chips can accelerate their penetration in AI data center infrastructure procurement, and whether XigTech can transform its first-mover advantage into sustainable commercial income to support the high premium valuation given by the market.