Chinese artificial intelligence (AI) stocks are expected to defy a slowdown across industries, as the mainland relies on the technology to boost business efficiency and revive economic growth, according to investors and analysts.
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Companies including Meituan and Xiaomi were set to benefit from a wave of AI integration that would transform business models, according to Morgan Stanley, as investors look for new winners after DeepSeek’s breakthrough in generative AI technology. China Asset Management, one of the mainland’s biggest mutual-fund firms, said last month that the country’s AI adoption – estimated at 5 per cent penetration at present – was on the cusp of explosive growth, similar to personal computers in the 1980s.
“AI will probably become a key driver for China’s modernisation,” said Yao Pei, an analyst at Huachuang Securities, in a report this month. “There are lots of catalysts for AI, and AI is expected to penetrate into every industry,” notably electronics, computing and media, Yao said.
DeepSeek’s surprising ascent earlier this year put China’s technology stocks back into the spotlight, spurring optimism that the country would be able to lead the world in AI in spite of US export curbs. Investors are identifying new prospects in the industry after making bets on platform-based developers of large language models such as Alibaba Group Holding and Tencent Holdings. Alibaba owns the Post.
China’s biggest online travel agency Trip.com Group, short-video platform operator Kuaishou Technology and budget e-commerce operator PDD Holdings are among the companies that stood to thrive on AI applications, according to Morgan Stanley. Other potential beneficiaries included electric-vehicle makers BYD and Nio, as well as household appliances maker Midea Group, it said in a report in May.
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Unlike the US, which had an edge in AI computing, China was focused on efficiency – emphasising revenue generated by AI-enabled offerings and cost savings achieved through high productivity, the US investment bank said.