Key Takeaways:
Shengshu Technology, the Alibaba-backed AI video platform, is considering a Hong Kong listing next year with plans to raise more than $500 million, Bloomberg reported.
The company is working with CICC and CITIC Securities on the IPO, according to Bloomberg, which cited people familiar with the matter.
Shengshu Technology said in April it raised RMB 2 billion in a funding round led by Alibaba. Early backers include Qiming Venture Partners, Baidu and a Beijing municipal government fund.
Founded in March 2023, Shengshu developed Vidu, China's first fully self-developed AI video generation model, which has been applied in advertising, animation and film production. The company's technology generates video content from text prompts, a segment that has drawn intense interest from global tech investors.
The proposed listing would add to a pipeline of AI-related IPOs in Hong Kong as the city seeks to attract technology companies. Alibaba shares rose 2.5 percent on the day, while Baidu gained 1.8 percent.
The deal size of more than $500 million would make it one of the larger tech listings in Hong Kong next year. The company has not disclosed a target valuation, offer price range or listing timeline beyond next year.
The IPO would test investor appetite for AI video generation companies, a segment that has drawn significant venture funding but has yet to produce a major public listing. Shengshu's Vidu model competes with offerings from larger tech firms as demand for AI-generated content grows across advertising, animation and film.
A successful listing could encourage other AI startups backed by Chinese tech giants to pursue public offerings in Hong Kong, which has worked to revive its IPO market in recent years. Investors will watch for the filing's valuation details and any cornerstone investor commitments as the deal progresses. The listing would also give Alibaba a potential exit path for its investment in the AI video space, a sector where the e-commerce giant has been expanding its footprint.
This article is for informational purposes only and does not constitute investment advice.
