Baidu's stock jumped 7% because someone whispered the magic number fifty billion into a Bloomberg terminal. The AI chip unit Kunlunxin wants to go public in Hong Kong at a valuation that assumes every person in China will buy seventeen AI chips and name them after their favorite aunt.
Kunlunxin makes chips. Not the kind you eat. The kind that supposedly power artificial intelligence, which is itself not actually intelligent but we're all pretending together now. Baidu spun this unit off so it could have its own separate investor base to disappoint. Smart.
The $50 billion target puts Kunlunxin's valuation somewhere between "are you f*cking kidding me" and "no seriously, are you f*cking kidding me." For context, that's more than the GDP of Panama. Panama has a canal. Kunlunxin has PowerPoint slides about Moore's Law.
Retail traders saw the 7% pop and immediately started Googling "what is Kunlunxin" and "how to buy Hong Kong stocks" and "why does my wife hate me." The first two questions have answers. The third one doesn't require Google.
Baidu gets to keep a stake in Kunlunxin after the IPO, which means they profit twice: once when retail buys the story, and again when institutions short the reality. This is called financial engineering. It's legal.
The IPO hasn't been officially announced yet. These are just reports. Whispers. The kind of whispers that move billions of dollars before anyone confirms if the whispers are attached to actual human beings with actual information.
Hong Kong gets another overpriced tech listing, Baidu's shareholders get a sugar rush, and some poor bastard in Nebraska just put his kid's college fund into shares of a company whose name he can't pronounce because a chart went up and to the right for six hours.
Photo by on Unsplash
Leave a Comment