Chinese robot maker’s IPO 5,500 times oversubscribed by retail investors
Unitree raises $900mn ahead of Shanghai listing expected later this month
China’s retail investors are jostling for a slice of a leading humanoid robot company, in a sign of huge enthusiasm for tech stocks in the country.
The retail segment of Unitree’s initial public offering was more than 5,500 times oversubscribed, according to a stock exchange filing published ahead of a listing in Shanghai this month, even as more shares were made available to smaller investors to meet demand.
In advance of the IPO, Unitree allotted 40.4mn shares, or about 10 per cent of its outstanding shares, priced at Rmb150.8 ($22.35), raising about $900mn and giving the company a market valuation of $9bn.
Retail investors were allocated 16 per cent of the total, with institutional investors including hedge funds linked to DeepSeek founder Liang Wenfeng.
Huge enthusiasm for AI-related stocks in China is driving up valuations. The country’s tech-focused Star 50 index has surged more than 27 per cent this year, well ahead of the benchmark CSI 300’s 0.8 per cent gain.
The increased interest also comes amid a crackdown by authorities who are keen to limit Chinese citizens’ exposure to US equity markets.
Unitree, founded by Wang Xingxing in 2016, has become a champion in China’s robotics industry. It is a widely recognised brand thanks to its robots’ dancing, flipping and boxing displays at lunar new year galas.
Last year, the company’s success earned Wang a front-row seat at a meeting with Chinese President Xi Jinping.
The retail investor interest in Unitree far exceeded that of CXMT’s blockbuster IPO last month, which was more than 200 times oversubscribed.
“The humanoid robotics industry in mainland China is undergoing a phase of rapid development, and Unitree is highly representative of this sector,” said Kenny Ng, a strategist at Everbright Securities International.
The share sale gives Unitree a price-to-earnings ratio of 219 and a price-to-sales ratio of almost 36, based on last year’s results. The company shipped 5,500 humanoid robots last year. The largest use of the IPO proceeds will be Rmb2bn ($296mn) spent on developing AI models for its robots.
Citic Securities is acting as the sponsor and lead underwriter.
The frenzy comes despite the US Federal Communications Commission banning imports of humanoid robots last month in a move widely seen as targeting Chinese products.
According to Unitree, overseas revenue accounts for more than 40 per cent of its earnings, with the US making up between 13.3 per cent and 18.4 per cent depending on the year.
In a section of its IPO prospectus highlighting risks, Unitree said the FCC move would not “affect the continued sales of the company’s existing main products in the US market” but added that its new models would “face the risk” of being cut off.
In a recent note, Sheng Zhong, an equity analyst at Morgan Stanley, highlighted the Unitree IPO as a “catalyst” that could support other listed stocks in the sector.
Humanoid robots, which increasingly have applications with “embodied AI”, or AI deployed in the physical world, are a source of emerging competition between the US and China, she noted.
“As the industry accelerates and continues to ramp up, we think this could be the beginning of US and China embodied AI competition escalation,” she said.