Baidu’s AI Chip Unit Kunlunxin Plans Hong Kong IPO.

Prospective IPO investors were reportedly encouraged to buy Kunlunxin semiconductors alongside their IPO investments, with some asked to purchase chips worth three to seven times the value of their intended investment, according to the report.

Baidu said in January that Kunlunxin had confidentially filed a listing application with the Hong Kong Stock Exchange, paving the way for a spin-off and separate listing. Baidu did not immediately respond to a Reuters request for comment on the chip-buying requirement.

China’s onshore technology IPOs are on track for their strongest year since 2023, as Beijing seeks to bolster listings of chip and artificial intelligence companies in a push for technological self-reliance amid the country’s rivalry with the United States.

Despite Chinese progress, the United States remains for now ahead in the race for dominance over the so-called artificial intelligence hardware stack — the resources and equipment, especially semiconductors, needed to run AI models, according to a report by Brussels-based economic think tank Bruegel. However, the think tank also noted that "the signs of Chinese catch-up are real," citing factors such as an open-source toolkit with a state-backed contributor pipeline and a large enough domestic market that could support the ecosystem through its immature phase.

Baidu confidentially filed a listing application for Kunlunxin on the Hong Kong Stock Exchange at the start of the year, though offering details, including size and structure, were undecided at the time. Founded in 2011, Kunlunxin mainly supplies chips to its parent company Baidu. While Baidu retains a controlling stake, the company operates independently and has broadened its scope to external sales over the past two years.