Chinese A.I. Stocks Jump On Growing ChatGPT Interest, State Media Warns Of Risks
February 9, 2023
With growing interest surrounding OpenAI’s ChatGPT, stocks related to artificial intelligence listed in mainland China have soared this year – with one company having tripled in valuation since January.
Alibaba said it’s working on a rival product similar to ChatGPT, while Baidu announced earlier this week it will launch “Ernie bot,” its own artificial intelligence chatbot.
Shanghai-listed shares of Beijing Haitian Ruisheng Science, an AI data resource company, rose about 205% year-to-date. Hanwang Technology is up 124% and CloudWalk Technology Company rose 105% as of Wednesday’s trading session.
The latest moves surrounding AI-related stocks in China have caught the attention of the Shanghai Stock Exchange – which issued a letter to CloudWalk Technology and Haitian Ruisheng Science, citing “abnormal trading” of the companies’ stocks.
“Please pay attention to investors, avoid capital risks, hype, make rational decisions, and invest prudently,” it said in a Tuesday filing. “The continuous rise of the company’s stock price has accumulated more risk of profit adjustment.”
Hong Kong-listed Zhihu, China’s version of Quora, surged to a record intraday high on Wednesday as investors continued to bet on the rising sector, according to FactSet data.
Risks ahead Chinese state media also warned traders about the risks of betting on AI-related companies.
The Securities Times on Wednesday published a commentary saying some companies are “simply riding on concept without conducting actual businesses,” citing previous hypes surrounding 5G, augmented reality and virtual reality.
A separate article mentioned the Shanghai Stock Exchanges notices on AI companies’ stock movements, saying, “Even if domestic companies have the desire to enter ChatGPT, risks that lie ahead include whether they can achieve large-scale and lasting investment, whether they can keep up with the industry iteration cycle, and whether they can form scenario-based results.”
AI-related stocks in South Korea have also seen a recent surge in stock prices on the heightened attention in the sector.
Seoul-listed Konan Technology rose about 230% year-to-date, Selvas AI surged 110% so far this year, and Neuromeka is higher by more than 70%. Since January, Minds Lab is up 53% and Saltlux rose about 65%.
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