Goldman Sachs has identified three preferred Chinese artificial intelligence models, with only one being publicly traded. The investment bank initiated coverage on Hong Kong-listed Zhipu, also known as Knowledge Atlas, with a price target of 1,880 Hong Kong dollars ($239.83). This represents nearly a 15% upside from the stock's closing price that day.
The company has seen significant growth since its listing in Hong Kong in January. Recently, it gained further attention as its open-sourced GLM-5.2 model is considered to rival Anthropic's Fable 5 on several metrics.
“With its latest GLM5.2 model reaching near-frontier performance that has seen significant ramp-up in domestic enterprise and global SME adoption, we believe its extensive usage by coders will enable Zhipu to sustain a high frequency of further model upgrades, thereby solidifying its leading position in enterprise/coding in China,” analysts stated.
While they initiated coverage on the stock with a neutral rating, their two other preferred Chinese AI model companies are Deepseek and ByteDance, both of which are privately held.
The analysts assessed the models based on factors such as time to market, arena score, valuation, and pricing. The research also included AI video generation capabilities, for which ByteDance was rated the best.
Zhipu's GLM and DeepSeek's models generally ranked better than those from Alibaba, Tencent, and Minimax, especially in time to market and arena score.
“China's AI open-source/open-weight models are reaching a critical point of intelligence performance vs. global proprietary models,” the analysts noted.
“Agentic AI is driving explosive demand for these value-for-money models at the lower end. Access to computing will be a swing factor, where US/China regulations, balance sheet, and inference efficiency are key,” they added.
