9888.HK Stock Today: January 05 – Kunlun Chip Spin-Off Unlocks Value
Baidu stock rallied in Hong Kong after the company said Kunlun Chip, its AI chip unit, filed a confidential HKEX listing application and will remain a subsidiary post split. Investors see clearer value for the chip business and a stronger full‑stack AI story. In recent trade, 9888.HK rose to HK$143.8, up 9.35%, with a new 52‑week high at HK$144.1. We break down what the filing means, today’s market action, key metrics, and the next catalysts for Hong Kong investors.
Kunlun Chip filing: structure and significance
Baidu confirmed Kunlun Chip submitted a confidential application for a Hong Kong listing and will stay a Baidu subsidiary after the split. Management aims to surface the chip unit’s standalone value while keeping strategic control. Strong recent debuts of domestic AI‑chip peers lifted sentiment, according to local coverage, which supports interest in the potential IPO path source.
Separating the AI chip unit can highlight growth prospects and margins distinct from the core ads, cloud, and autonomous driving lines. A Goldman view cited by media suggests, if valued similar to Cambricon, Kunlun might equal around 45% of Baidu’s market cap, though this is not guidance source. Clarity on governance, proceeds use, and allocation will matter.
Market reaction and key technicals
Shares jumped 9.35% to HK$143.8, with intraday HK$144.1 setting a new 52‑week high. Volume hit 33.86 million vs a 14.18 million average, showing strong participation. The price now sits above the 50‑day HK$119.48 and 200‑day HK$100.37 averages. Year to date, gains are about 59.8%, while the 1‑year move is 48.1%, placing Baidu stock back in leadership.
RSI is 63.9, nearing overbought, and CCI at 171 signals stretched conditions. ADX at 11.5 shows no strong trend, so moves may stay choppy. ATR of 4.32 suggests wider swings. Initial supports sit near HK$140 and the 50‑day average. Resistance is around HK$144 to HK$145. A sustained hold above the breakout would reinforce momentum.
Fundamentals and valuation snapshot
Baidu trades at about 13.3x TTM earnings and 1.28x book, with a market cap near HK$390.1 billion. Net margin is roughly 21.0% and ROE about 10.4%. R&D spend is 15.5% of revenue, reflecting ongoing AI investment. TTM free cash flow per share is negative at about -3.41, a point to monitor into 2026. There is no regular dividend.
The chip listing could improve transparency and highlight the AI stack. Media citing Goldman’s comp work implies Kunlun Chip might command a sizable portion of group value, though outcomes depend on market conditions and final terms. Baidu stock may re‑rate if investors gain confidence in chip growth, margin profile, and capital allocation after the listing.
What Hong Kong investors should watch next
Look for HKEX feedback, prospectus details, and potential timing windows. Monitor unit‑level KPIs, customer wins, and production roadmaps for Kunlun Chip. Group catalysts include earnings on 18 February 2026, AI monetization within Baidu Core, cloud profitability, and Apollo scale milestones. Added disclosure could reduce the conglomerate discount and support Baidu stock.
The listing could face timetable shifts or market windows closing. Chip demand visibility, supply constraints, and local competition remain real. Group cash flow trends have been mixed in TTM figures. With ADX low and overbought signals flashing, pullbacks can be sharp. Macro sentiment in China and policy headlines may add volatility in Hong Kong trading.
Final Thoughts
Baidu’s move to list Kunlun Chip in Hong Kong aims to crystallise the value of its AI hardware platform while keeping strategic control. Price action shows strong interest, with a new 52‑week high, heavy volume, and the stock holding above key moving averages. Fundamentals look reasonable at about 13x earnings and 1.28x book, with solid margins and active R&D. Near term, watch listing progress, prospectus detail, and February earnings for guidance on growth and capital plans. Traders should respect overbought signals and wider ranges. For long‑term investors, a cleaner sum‑of‑parts story and improved disclosure could support a more robust case for Baidu stock as the AI cycle develops in China.
FAQs
Baidu said Kunlun Chip filed a confidential HKEX listing application and will remain a subsidiary after the split. This keeps control with Baidu while giving the chip unit room to raise capital and report results more clearly. Investors will look for prospectus details on governance, use of proceeds, and unit‑level metrics.
Shares rose 9.35% to HK$143.8 with a new 52‑week high at HK$144.1 and volume well above average. The price is above the 50‑day and 200‑day averages. Technicals show RSI 63.9 and CCI 171, which suggest near‑term overbought conditions and possible swings.
At about 13.3x TTM earnings and 1.28x book, Baidu’s multiples remain moderate versus many AI stories. Margins are solid, but TTM free cash flow per share is negative, which investors should monitor. A clearer sum‑of‑parts, post listing, could reshape the valuation debate for Baidu stock.
Watch for HKEX review developments and any prospectus updates from Kunlun Chip. For the group, earnings are scheduled for 18 February 2026. Delivery on AI monetization, cloud profitability, and Apollo milestones can drive sentiment in Hong Kong alongside the chip unit’s listing progress.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
