Chinese AI chip developer Biren Technology is reportedly preparing another 4 billion yuan share placement, even as its stock has halved from its year high.

Less than a year after its listing, Biren Technology (6082.HK), one of China's "four little dragons" of domestic GPUs, has carried out two placements in a row. If the latest placement goes through, Biren will have raised a total of HK$17.261 billion since listing, the most of any domestic GPU company listed on the market. The company plans to use the funds to seize an early commercial lead.

On October 8, Biren announced a new placement. According to the announcement, the company intends to place no fewer than 130 million H shares at HK$31.80 per share with no fewer than six placees, equal to about 4.76% of its enlarged share capital. The estimated net proceeds are HK$4.02 billion.

The placing price represents a discount of about 9.76% to the closing price on the day before the announcement. After the announcement, Biren's share price fell sharply, closing down 11.85% at HK$30.36 that day. At the close on October 9, the stock was at HK$31, giving the company a market capitalization of HK$80.6 billion.

Since December 2025, a wave of Chinese AI chip companies has gone public. Moore Threads (688795.SH), MetaX (688802.SH), Biren Technology, Iluvatar CoreX (9903.HK) and Enflame (688801.SH) have all entered the capital markets one after another.

Biren and Iluvatar CoreX listed in Hong Kong, where more flexible placement rules have allowed both companies to return to equity financing after their listings. Iluvatar raised about HK$7.034 billion in July. Biren raised net proceeds of HK$7.038 billion in July and HK$4.02 billion in October.

Biren has now become the largest fundraiser among the five AI chip companies, with a cumulative total of about HK$17.261 billion since listing (roughly RMB 14.7 billion).

The use of Biren's proceeds also shows where the AI chip industry's focus is shifting. At the time of listing, R&D was the central investment priority for AI chip companies. As each company's next-generation chips have achieved breakthroughs, however, commercialization has become the new core issue.

**Racing for a commercial head start**

Biren's repeated fundraising after its Hong Kong listing reflects a new assessment of the AI and GPU market landscape.

In January this year, Biren listed in Hong Kong and raised net proceeds of about HK$6.204 billion. At the time, the company planned to allocate 85% of the proceeds to R&D for its GPGPU chips and related hardware and software platforms. By comparison, only 5% was earmarked for product commercialization.

In its annual report published in April of that year, Biren also said that its cash on hand and the net proceeds from the listing would provide sufficient funding for ongoing technology development, capacity expansion and commercial deployment.

However, the AI industry has developed rapidly, and market conditions have changed just as quickly. Since the start of 2026, global demand for computing infrastructure has continued to rise, and domestic internet companies and computing infrastructure providers have significantly increased their AI capital expenditure. As a result, the addressable market for GPGPU products has expanded considerably. Stable delivery capacity and the ability to supply at scale have become key criteria for customers choosing GPGPU partners.

Against this backdrop, Biren's own R&D has reached a critical stage. According to the company's announcements, its next-generation product has completed initial testing and entered the post-tape-out validation stage, with progress well ahead of expectations. This has pushed the company to accelerate its commercialization to gain an advantage in the competition.

Among leading domestic AI chip companies, the performance gap between cutting-edge products has not yet widened significantly. Most companies, in their marketing, benchmark their latest products against Nvidia's H100 or H200.

For example, Moore Threads' flagship MTT S5000 has been benchmarked in testing as comparable to Nvidia's H100, and MetaX's Xiyun C700, which it is developing, is also positioned against the H100. Biren's next-generation flagship, the BR20X, is positioned against Nvidia's H200. The product is expected to enter post-silicon validation and sample testing in the fourth quarter of this year, with large-scale deployment in 2027.

Publicly available information shows that the H100 and H200 are computing chips Nvidia launched in 2022 and 2023, respectively. The two share the same architecture and process node, and their GPU die, core count and clock frequency are unchanged. The H200's performance gains come mainly from its HBM3E memory, which gives it greater memory capacity and bandwidth.

Therefore, while domestic chips have not yet shown a clear generational gap, whichever domestic chip company first establishes a viable commercial path will have the chance to build its own chip ecosystem and, from there, a commercial moat.

This is also a consequence of the nature of AI chips. A user who selects an AI chip must build AI frameworks, models and other software ecosystems adapted to that chip, and such an ecosystem is difficult to transfer to chips from other brands, making switching costs extremely high.

However, to commercialize their chips, companies must first lock in upstream supply chains, including advanced-node manufacturing capacity and supply of HBM memory. This requires large amounts of capital, which is why Biren's two recent placements are intended to fund the locking-in of its upstream supply chain.

In July this year, Biren raised HK$7.038 billion, of which 60%, or HK$4.223 billion, was to be used for commercialization and production scale-up of its GPGPU solutions. Specifically, the funds will support customer sample deliveries, the development of rack-scale and supernode reference designs, expansion of mass-production capacity and strengthening of supply chain security.

Biren expects most of these funds to be deployed by the end of this year, well ahead of the original timeline of the end of 2027.

For this reason, the company has launched the new placement to raise HK$4.02 billion, 70% of which will continue to go toward strategic supply chain procurement, production preparation and commercialization for its next-generation products. The aim is to increase supply, improve delivery readiness and accelerate commercial shipments of its next-generation products.

Other domestic AI chip companies are also stepping up their commercialization efforts. In July, Iluvatar CoreX raised HK$7.034 billion in a placement, with 60% earmarked for strategic supply chain resilience and procurement planning for key materials and components. In addition, MetaX and Moore Threads announced in June and August, respectively, plans for secondary listings in Hong Kong.

**AI chip stocks pull back**

When Biren first placed shares in July, the placing price was HK$46.20 per share. By the second placement in October, the price had dropped to HK$31.80. Behind this decline, Biren and the broader AI chip sector have seen a share price correction since July.

Moore Threads, MetaX and Biren have each fallen by about half from their year-to-date highs. Enflame listed later, but its latest share price is still about 20% below its year-to-date high. Iluvatar CoreX's latest share price is more than 70% below its year-to-date high.

The pullback in AI chip stocks is linked to the AI sector entering an overheated correction phase.

In July, Morgan Stanley's chief U.S. equity strategist Michael Wilson sent a clear signal to the market. He argued that the time had come for sector rotation, and that investors should reduce their holdings of semiconductors and move into hyperscale cloud computing providers. Since July, the global AI computing supply chain has undergone a deep correction.

From the perspective of the domestic GPU companies themselves, although several firms achieved rapid revenue growth in the first half of the year, their revenue scale remains small, and none has yet turned its core business profitable. This makes it difficult to sustain their high market valuations over the long term.

Take Biren as an example. In the first half of this year, the company reported revenue of RMB 1.236 billion, up 1,997.59% year on year, but a net loss attributable to shareholders of RMB 377 million, meaning it has still not returned to profitability. Its latest price-to-sales ratio remains as high as 32 times.

Apart from market factors, the sharp increase in tradable shares from the lifting of lock-up restrictions has also been one trigger for the steep share price declines at AI chip companies. Biren saw 6.12% and 5.88% of its restricted shares unlocked in July and October, respectively. A further 33.59% of its shares will be unlocked in January 2027, and the market may be pricing in expected selling ahead of that date.

At the latest share price, the market value of the shares scheduled to be unlocked in January 2027 is as high as HK$27 billion.