DeepSeek Engages CITIC Securities for a STAR Market Listing, Targets a 500-Billion-Yuan Valuation

DeepSeek has engaged CITIC Securities, one of China's largest investment banks, to prepare an IPO on Shanghai's STAR Market, the Chinese equivalent of Nasdaq for technology and innovation-driven companies, targeting a listing application by the end of 2026 and a public debut in 2027. In parallel, the company is finalizing a new private round targeting a valuation of roughly 500 billion yuan (about $74-75 billion), up sharply from the 450-billion-yuan valuation reached in its first external round in June 2026.

That June round brought in founder Liang Wenfeng personally (20 billion yuan), Tencent Holdings (10 billion yuan), and battery maker CATL (5 billion yuan) as the company's largest external shareholders. The round now being prepared would add a wider circle of backers, including CPE, Legend Capital, Stony Creek Capital, and funds tied to GigaDevice and Hefei state investment vehicles.

DeepSeek was, just two years ago, a research project financed almost exclusively by its founder's quantitative hedge fund. It became globally known in January 2026, when its models demonstrated performance comparable to leading Western systems at a fraction of the training and operating cost, a shock that briefly wiped more than $500 billion off the market capitalization of AI-linked US tech stocks. The June 2026 round marked the first real opening of its capital to outside investors, and proceeds from the round now being prepared are earmarked for four priorities: computing infrastructure, continued model development, in-house chip design, and talent retention, a four-part focus that reveals a company moving from research-project status to a fully industrialized one with hardware-vertical ambitions of its own.

DeepSeek's revenue for the first seven months of 2026 stood at roughly 475 million yuan, a figure worth weighing against the targeted 500-billion-yuan valuation to gauge the scale of the premium being placed on the company, a multiple that reflects a bet on strategic position and technological sovereignty more than on current commercial fundamentals.

The choice of Shanghai's STAR Market over Hong Kong, let alone a US listing, is not incidental: a US listing is considered highly unlikely given Congressional scrutiny of Chinese AI, and the STAR Market offers an entirely domestic capitalization route, out of reach of US extraterritorial jurisdiction, a choice that fits Beijing's broader strategy of building a sovereign capital pipeline for its most strategic technology champions.

It's worth placing DeepSeek's targeted valuation within the global AI landscape. Some investors expect Anthropic's eventual IPO to carry a valuation as high as $2 trillion, while OpenAI is reportedly targeting as much as $1 trillion for its own planned listing. Against those orders of magnitude, DeepSeek's targeted $74-75 billion remains, proportionally, notably more modest, a gap that reflects less a judgment on the technical quality of Chinese models than the persistent fragmentation of capital markets between the American and Chinese ecosystems, and the continued absence of a genuinely unified global market for pricing frontier AI.

This is a two-tier signal that pulls in different directions. On one hand, DeepSeek continuing to raise capital at scale, despite already sitting on the US Entity List since early August, demonstrates the depth of the domestic Chinese capital pool available to its most strategic technology champions, independent of US sanctions. On the other, a valuation multiple north of 1,000 times annualized revenue, in a sector already flagged by a national security advisory, is a vulnerability signal worth tracking closely.

We recommend watching two leading indicators in particular: the final composition of the funding round, since state-linked participation, such as vehicles tied to Hefei, would reinforce the sovereignty thesis over a pure financial-return one, and the actual IPO filing timeline, which could slip if the NSA/FBI/CISA case referenced above escalates further.