New Stock Analysis| Xizhi Technology (01879): Star cornerstone investor leads with a HKD 1.644 billion investment, the world's first AI silicon photonics chip company starts IPO.

Pioneer of Full-Light AI Computing Power Infrastructure, optical-electronic hybrid computing unicorn Guiding Overseas Intelligence Technology (1879.HK) today launched its IPO, entering the final countdown to listing. It is understood that Guiding Overseas Intelligence Technology's IPO period is from April 20th to 23rd, with an IPO price ranging from 166.6 Hong Kong dollars to 183.2 Hong Kong dollars, planning to globally offer 13.7952 million H shares. Based on the middle price of the IPO price per share at 174.9 Hong Kong dollars, the net proceeds from the global offering is approximately 2.2669 billion Hong Kong dollars. Based on the lower end of the IPO price at 166.6 Hong Kong dollars, the market valuation at listing is 153.22 billion Hong Kong dollars, with plans to list on the main board of the Hong Kong Stock Exchange on April 28th. In this IPO, Guiding Overseas Intelligence Technology has brought in a number of institutional cornerstone investors, including Alibaba, CMCC Capital, Lenovo, ZTE, and other AI computing industry giants, as well as international sovereign funds such as GIC, BlackRock, Fidelity International, Baillie Gifford, Schroders Global, Temasek, and UBS, as well as top domestic private equity firms such as Hillhouse, Sequoia Capital China, CPE, technology industry multi-strategy funds such as 3W, Aspex, mainstream investment forces such as Ping An Asset Management, GF Fund, ICBC Wealth Management, and other major industry investors and global top-tier institutions have placed cornerstone investments in this IPO of Guiding Overseas Intelligence Technology, fully demonstrating the recognition of the long-term value of the company. Cornerstone investors will subscribe for US$200.9 million (HK$1.644 billion) of shares at the offering price, accounting for 71.54% of the total offering, a high proportion of cornerstone subscriptions highlighting the broad market recognition. The company has garnered endorsement from several star institutions prior to listing, having undergone multiple rounds of financing and brought in well-known industry and long-term strategic capital such as Tencent, Baidu, China Mobile Limited, and Shanghai Guotou. According to Frost & Sullivan data, Guiding Overseas Intelligence Technology is the world's first company to achieve large-scale deployment of optical-electronic hybrid computing power. Based on revenue projections for 2025, the company ranks first among independent Scale-up optical interconnect solutions providers with a market share of 88.3%. In 2024 and 2025, the company's cumulative shipment of optical computing chips ranked first globally. In this listing, the company plans to use approximately 70% of the net proceeds for research and development over the next five years, including the continued development of optical interconnect and optical computing businesses, and approximately 20% for commercialization efforts. High growth industry, scarce track supply Artificial intelligence is developing at an unprecedented pace, but constrained by Moore's Law and other physical limits, the issue of computing power shortage continues to be evident. Guiding Overseas Intelligence Technology's optical-electronic hybrid computing technology directly addresses the issue of computing power shortage through the "enhanced single card computing power" of optical computing and the "improved multi-card collaborative efficiency" of optical interconnect. According to the prospectus, Guiding Overseas Intelligence Technology is focusing on the Scale-up optical interconnect market in the field of optical interconnect. It's worth noting that optical interconnect was previously mainly used in Scale-out networks (interconnections between computing nodes), but in recent years, Scale-up networks (high-speed interconnections between chip within computing nodes) have gained widespread attention. A milestone event was NVIDIA's introduction of the "Copper Scale-up" and "Optical Scale-up" dual-track parallel technology pathway at the 2026 GTC Conference to break through the bottleneck of traditional electrical interconnects in bandwidth, latency, and power consumption. This signifies a clear industry signal: optical interconnect is moving from the periphery of data centers to the core computing clusters. According to Frost & Sullivan data, the Chinese Scale-up optical interconnect market is on the verge of explosive growth. The market size by 2025 is estimated to be 5.7 billion yuan, with a compound annual growth rate of 99.6% expected to reach 180.5 billion yuan by 2030. However, there are few early players in the industry, and the supply is extremely scarce. In 2025, only two companies in the Chinese Scale-up optical interconnect market successfully commercialized on a large scale. Guiding Overseas Intelligence Technology is the only independent Scale-up optical interconnect solutions provider domestically in China that has achieved large-scale commercialization, with a market share of approximately 88.3%. The company launched the optical path switching product LightSphere X in 2025, the world's first distributed optical path switching solution for GPU super node interconnections, capable of increasing model floating-point operation utilization by over 50%. In contrast to optical interconnect, although optical computing is still in its early stages of commercialization, it has more disruptive potential - it has the potential to completely change the current computing paradigm. The core advantage of optical computing is the ability to perform matrix multiplication and other linear algebra calculations at high speed within the optical domain, which are key workloads in large language models, neural networks, and scientific computing. Currently, only two companies globally have commercialized optical computing, with Guiding Overseas Intelligence Technology being one of them, and its cumulative shipment of optical computing chips in 2024 and 2025 ranked first globally. The company has released the PACE series optical-electronic hybrid computing acceleration card, which has shown significant performance advantages in target tasks in test environments: in specific combinatorial optimization problems (such as the maximum cut problem), the total solving time of the PACE prototype for core tasks is over 100 times faster than similar GPUs. This speed improvement is mainly due to the ultra-low iteration delay of about 5 nanoseconds of PACE - a direct result of the optical computing architecture. Moreover, because matrix multiplication is a passive process, energy consumption is significantly reduced. According to a research report published by Guiding Overseas Intelligence Technology in "Nature," PACE's energy efficiency (including external laser power consumption) is approximately 2.38 TOPS/W (trillions of operations per Watt per second). Currently, the company is developing PACE 3 to support larger-scale commercial deployment, and is expected to expand its optical computing products to more promising business scenarios, including large-scale language model inference, while expanding its customer base beyond early adopters. The scarcity of products and the company's leading position in product technology in the industry give Guiding Overseas Intelligence Technology a strong competitive advantage. This achievement is attributed to the company's talent team and high research and development investment: led by two industry experts, the company has overcome challenges from the early stages of entrepreneurship to rapid development, continuous progress in research and development, and efficient operation to unleash performance. High-intensity research and development investment, commercialization driving high growth Guiding Overseas Intelligence Technology was founded in 2017, with co-founder Dr. Shen Yichen publishing a cover paper in "Nature Photonics," validating the feasibility of using light for computation for the first time, laying the foundation for the development of optical computing. The other co-founder, Dr. Meng Huaiyu, focused on optical interconnect technology and as a core member participated in the development of multiple core devices in the world's first on-chip optical network project. Under the leadership of the two technical experts, the company has built a large technology team, with 176 employees in the research and development department (including the two aforementioned co-founders), 117 of whom hold master's degrees, accounting for 67.2% of the total employees. As of now, the company has registered 71 patents with the Chinese National Intellectual Property Administration, and 79 patents have been registered in jurisdictions such as the US, Hong Kong, the EU, and Taiwan, with an additional 260 patents pending worldwide. The research and development spending of the company from 2023 to 2025 were 280 million yuan, 352 million yuan, and 479 million yuan respectively, with a compound growth rate of 30.8%. The company continues to increase its research and development investments and has now built a comprehensive research and development platform covering all key aspects of optical-electronic hybrid computing, with three core technologies: inter-chip optical network (oNET), on-chip optical network (oNOC), and photon matrix computing (oMAC), to drive the two major product lines of optical interconnect and optical computing. In terms of commercialization time, the two core series of optical interconnect products, Scale-up and Scale-out, were commercialized in 2024, and the optical computing product PACE1 optical-electronic hybrid computing acceleration card began commercialization in 2022. In terms of revenue contribution, the optical interconnect products have become the company's main source of revenue, with revenue shares of Scale-up products, Scale-out products, and optical computing products in 2025 accounting for 71%, 4.8%, and 19%, respectively. Driven by the two major product lines, the company's revenue increased from 38 million yuan in 2023 to 106 million yuan in 2025, with a compound growth rate of 67%. Economies of scale have optimized the research and development expense ratio by 281.4% during this period, administrative expense ratio by 124%, and operating expense ratio (sales, administrative, and research and development) by 396.8%. With the growth in scale revenue, the company's expense ratio has been further optimized, driving continuous improvement in profitability. Over the past two years, the commercialization of the company's two major product lines has been in a rapid growth phase, and in 2026, with the explosive growth of the AI + computing power demand, coupled with market scarcity and its strong product strength, the company's performance is expected to scale up explosively. Significant potential for valuation reshaping, optimistic outlook by institutions So, how should Guiding Overseas Intelligence Technology be valued? Looking at the performance of companies in the same sector in the secondary market, domestic AI chip companies have received considerable revaluation from the capital market at the time of listing - the market value of Bitmain's Hong Kong shares exceeded HK$100 billion on its first day of listing, Mobvoi's market value exceeded 280 billion and MoxiShares' A shares market value exceeded 330 billion, achieving tens of times increase in valuation over the pre-listing valuation. As of April 20th, the market values of Bitmain's Hong Kong shares, Mobvoi, and MoxiShares have grown by over 1.5 times, 4.7 times, and 5.7 times, respectively, compared to the issue price. Considering the development stage of Guiding Overseas Intelligence Technology, as the company accelerates the commercial deployment of its business, the Hong Kong market is expected to provide a similar extent of valuation revaluation. Furthermore, in addition to the scarcity of the sector that Guiding Overseas Intelligence Technology is in, there are currently no comparable companies in the Hong Kong market in the optical-electronic hybrid sector. With the company's listing in Hong Kong, it will be the only exit for Hong Kong investors to invest in optical-electronic hybrid solutions, making the investment scarcity highly prominent. Looking overseas, players in the same sector have been highly recognized by the capital markets: Lightmatter valued at $4.4 billion, Ayar Labs valued at nearly $4 billion, Celestial AI acquired by Marvell for $5.5 billion by the end of 2024 (including potential consideration), and DustPhotonics acquired by Credo for over $1 billion in April 2026 (including potential consideration). The first three comparable US companies have raised over $500 million in funding and are still in the early stages of commercialization. In comparison, Guiding Overseas Intelligence Technology has raised only $330 million in historical funding and has already achieved commercialized revenue on a large scale. Compared to similar overseas companies, there is a significant discount space, and the premium for listing has sufficient rationality. In summary, Guiding Overseas Intelligence Technology is in the forefront of the optical interconnect and optical computing sectors, with a strong talent team and high-intensity research and development investment, driving continued high growth in performance through the gradual commercialization of the two major product lines. The sustained high-intensity research and development investment has enabled the company to maintain its product technology leadership and scarcity, solidifying its position as an industry leader, and will fully benefit from the policy and market development dividends of the next decade. Guiding Overseas Intelligence Technology, as the only target in the optical-electronic hybrid computing sector in Hong Kong, has a low valuation in its listing this time, and compared to other sector targets, the company's talent team is an added value for valuation, as investment is in people; the two founding experts are likely to attract higher valuation from long-term institutions.