Morgan Stanley Target Hike Triggers 37% Rally for AI Firm Zhipu

Morgan Stanley bumped up its price target for Chinese artificial intelligence startup Zhipu by nearly 72 percent on Thursday. The news pushed the company stock higher, topping off a five day rally that saw the shares leap by over 37 percent. Analysts raised their Hong Kong price target from HK$990 to HK$1,700, pointing to better computing power access and a newly completed funding round as key reasons for the upgrade.

The investment bank highlighted a major shift in the Chinese AI industry. For months, investors worried that too many competing open source models would cause a race to the bottom on pricing. Analysts now believe the market is moving away from cheap price wars toward monetization built on model intelligence. Smarter models are starting to win big revenue, creating a much healthier commercial setup across the sector.

Other major tech players also felt the ripple effects. MiniMax saw its target trimmed to HK$900 due to slower near term growth expectations, though its stock still gained nearly 5 percent. Meanwhile, Alibaba drew praise for its cloud margins and end to end AI stack. With Asian tech indexes trending upward, market watchers are keeping a close eye on which AI developers can turn smart tech into steady revenue.