Observed Signal · Jul 5, 2026 · Coverage Initiation · Source: CNBC Investing · Impact: 2/5 · Sentiment: Positive
Macquarie: Buy Chinese AI Chip Stocks; Favours Cambricon
Macquarie’s China Information Technology analysts said in a late-June report that now is the best time to invest in China’s AI chip makers, citing the rise of domestic LLM players, a growing token economy and PRC government support that limits imports of advanced Nvidia GPUs. The bank initiated coverage on five Chinese AI-chip companies and rated Shanghai-listed Cambricon its top pick (outperform) with a 2,060 yuan target. Among Hong Kong-listed names it prefers Biren Tech with a 140 HKD target. Other picks include Iluvatar CoreX and MetaX; Macquarie rated Shanghai-listed Hygon underperform over market-share concerns. The report cites IDC data showing Huawei led AI chip shipments, with Cambricon second and Hygon third.
Brokerage coverage and bullish price targets on Chinese AI chip makers signal investor confidence and potential capital flows into domestic AI compute supply; relevant to AI infrastructure but not directly to core AdTech/MarTech businesses.
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Key Takeaways & Evidence Grounding
- Macquarie initiated coverage on five Chinese AI chip companies in a late-June report.
- Macquarie rated Shanghai-listed Cambricon 'outperform' with a price target of 2,060 yuan (~$303.43), implying >50% upside from the referenced close.
- For Hong Kong-listed China AI chip stocks Macquarie prefers Biren Tech with a price target of 140 HKD (~$17.85), more than double the referenced close.
- Macquarie listed Iluvatar CoreX and MetaX among its favorites and rated Shanghai-listed Hygon 'underperform' due to market-share loss concerns.
- The Macquarie report cited IDC data placing Huawei first in AI chip shipments last year, Cambricon second, and Hygon third.
Connected Companies & Entities
5 Entities mapped“Other favorites include Hong Kong-listed Iluvatar CoreX, followed by Shanghai-listed MetaX....”
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“Alibaba and Baidu also have subsidiaries that make AI chips....”
“Cambricon ranked a distant second to Huawei’s Ascend in terms of AI chip shipments last year, the Macquarie report said, citing IDC....”
“Hygon is well-positioned in China’s CPU and AI chip sector, though we attribute much of its success to tech transfer from AMD, and we see li...”
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China Tech Bets on AI Amid Macro Volatility
Analysts say China investors are concentrating on AI-related technology names to weather weaker macro growth. Portfolio manager Leonid Mironov (Gavekal) says his newly approved China stock fund has more than half of holdings tied to semiconductors, self-sufficiency or high-tech manufacturing, while consumer and health care exposures are minimal. WisdomTree’s Liqian Ren and Cambridge Associates’ Aaron Costello describe a narrowing rotation toward semiconductors, hardware, software and hyperscalers rather than broad tech leadership. April retail sales were China’s weakest since the end of the Covid-19 pandemic. Mironov holds Tencent, Alibaba and mainland hardware plays such as Anji Microelectronics; Morgan Stanley is overweight on AI model names Zhipu and MiniMax and rates Cambricon highly with a 2,000 yuan target.
Macquarie upgrades Broadcom stock, cites AI chip catalysts
Macquarie Equity Research upgraded semiconductor maker Broadcom from neutral to outperform, raising its price target to $490 from $437, implying 33% upside. Analyst Arthur Lai said the risk of Google insourcing its custom AI chips has played out and is now priced in after a July correction. Broadcom designs and supplies custom Tensor Processing Units for Google, but investors have worried about competition from Marvell Technology and Google's in-house chip efforts. Despite these concerns, Broadcom shares have fallen 23% over three months. The company recently reported better-than-expected fiscal Q3 results and issued a positive forecast. Lai also cited a 'better-than-expected AI capex plan, new customer win on AI accelerators, and market share gain/loss in AI ASIC projects' as potential catalysts.
China Ramps Up Domestic AI Chips as Nvidia Return Unclear
Chinese technology firms are accelerating deployment of domestically developed AI chips even as reports circulate that U.S. sanctions may be eased to allow some Nvidia H200 GPU shipments to select Chinese firms. Tencent said China-designed GPUs and other chips will show a “substantial increase” in availability this year and signalled higher capital expenditure, while Alibaba said its T-Head proprietary GPU chips have reached scaled mass production and are being used in its data centers. Local players including Moore Threads, MetaX and Huawei are expanding offerings after Nvidia was previously blocked from the market. Reuters reported U.S. approval for some H200 sales to about 10 Chinese firms, but no H200s have shipped and U.S. Treasury Secretary Scott Bessent indicated uncertainty about that report. Analysts say China may adopt a hybrid mix of domestic and U.S. chips for AI training and inference.
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