Kling AI picks banks for $1 billion Hong Kong IPO

Kuaishou Technology's artificial intelligence video unit, Kling AI, is preparing for a Hong Kong initial public offering in early 2027 to raise at least $1 billion, selecting CICC, Goldman Sachs, and UBS as underwriters. This comes amid a broader surge in Chinese AI valuations, with Moonshot AI targeting a $5 billion Hong Kong IPO in early 2027 at a $50 billion valuation, and DeepSeek seeking up to 100 billion yuan. However, both Moonshot and DeepSeek face regulatory scrutiny from the Cyberspace Administration of China.

Kling AI's planned Hong Kong IPO

• ▪Kling AI has selected China International Capital Corp. (CICC), Goldman Sachs, and UBS as underwriters for its proposed Hong Kong initial public offering.
• ▪Kling AI, an artificial intelligence video unit of Kuaishou Technology, is planning an initial public offering in Hong Kong to raise at least $1 billion, targeting a listing in early 2027.

Kling AI's funding and restructuring

• ▪Following Kling AI's July 2026 private funding round, Kuaishou Technology's ownership stake in Kling AI is expected to be diluted to approximately 68%.
• ▪In May 2026, Kuaishou Technology filed a restructuring plan consolidating Kling AI's assets into Beijing Keling, which grants investors repurchase rights if Kling AI does not go public by October 30, 2031.
• ▪Kling AI raised approximately $2.8 billion in a July 2026 private funding round that valued the unit at around $18 billion post-money and included participation from Tencent, Alibaba, and Baidu.

Kling AI's financial performance

• ▪Kling AI's annual recurring revenue reached approximately $500 million by March 2026, up from about $240 million in December 2025.
• ▪Kling AI's revenue in the second quarter of 2026 exceeded 850 million yuan, representing a year-on-year growth of more than 200%.

Moonshot AI's planned Hong Kong IPO

• ▪Bank of America is coordinating Moonshot AI's proposed initial public offering, with China International Capital Corp (CICC), Deutsche Bank, and Goldman Sachs acting as joint sponsors.
• ▪Moonshot AI is preparing for an initial public offering in Hong Kong targeting the first quarter of 2027, aiming to raise up to $5 billion.

Moonshot AI's valuation and revenue

• ▪Beijing-based Moonshot AI completed its final private funding round in 2026, valuing the company at approximately $50 billion, up from $31.5 billion in a funding round during the summer of 2026.
• ▪Moonshot AI's annual recurring revenue grew from $300 million in June 2026 to approximately $1 billion by October 2026, with projections to reach $2 billion by December 2026.

Moonshot AI's background

• ▪In July 2026, Moonshot AI launched its Kimi K3 open-source model, which drew industry attention and delivered competitive results against OpenAI and Anthropic.
• ▪Moonshot AI was founded in early 2023 by Yang Zhilin, a former professor at Tsinghua University who previously worked at Meta AI and Google Brain.

DeepSeek's funding and listing plans

• ▪DeepSeek has hired Chinese brokerage CITIC Securities to prepare for a potential listing on Shanghai's STAR Market.
• ▪Hangzhou-based DeepSeek is close to securing between 80 billion yuan and 100 billion yuan in a funding round, with Tencent and CATL among the largest investors.

Data and training disputes

• ▪US-based artificial intelligence company Anthropic has accused Moonshot AI and DeepSeek of using its Claude model to train their own AI models.
• ▪The Cyberspace Administration of China is investigating both Moonshot AI and DeepSeek over allegations of routing sensitive user data to Anthropic's Claude chatbot.

Chinese AI market listings

• ▪MiniMax and Zhipu, both Chinese artificial intelligence developers, listed on the Hong Kong stock exchange in January 2026, with MiniMax's shares more than doubling on its first day of trading.
• ▪Multiple Chinese artificial intelligence firms are pursuing public market listings in 2026, leading market participants to closely monitor the sector's equity financing activities.

Debatable claims

• ▪Hong Kong is the best listing venue for Chinese AI startups
• ▪Kuaishou's spinoff of Kling AI will benefit its shareholders
• ▪The multi-billion dollar valuations of Chinese AI startups are unsustainable