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Recently, a remarkable surge in the stock prices of companies associated with the DeepSeek concept has been drawing attention in the financial world, particularly in the Chinese A-share marketHowever, this frenzy met a challenging test on February 13, as significant discrepancies emerged within this sector, reflecting the volatile nature of stock trading.
Closing on February 13, several stocks linked to the DeepSeek concept experienced sharp declines after a series of substantial gains over the previous weeksFor instance, Qingyun Technology saw its shares dip more than 12% before closing nearly 3% downSimilarly, Zhejiang Data Culture and Meg Intelligent, after witnessing early gains, both hit a trading stop limit, closing down by 7.18% and 9.54% respectivelyOther prominent companies such as Yuntian Lifei (688343.SH), Guanghe Tong (300638.SZ), and Daotong Technology (688208.SH) faced falls of 7.95%, 6.29%, and 6.04% accordingly.
The retreat in stock prices is noteworthy, especially considering how rapidly these stocks shot up in value prior to this downturnRecently, many shareholders with more than 5% stakes in these DeepSeek-related companies have opted to cash in on the inflated pricesDisclosures indicate that major investors in firms like Qingyun Technology and Parallel Technology seized this opportunity to liquidate thousands of millions in shares at a high point.
On the evening of February 12, Qingyun Technology announced that two of its major shareholders, Jiaxing Lanchi and Tianjin Lanchi, collectively reduced their holdings by 1.3% of the company's sharesThe details revealed that Jiaxing Lanchi sold off approximately 113,700 shares from February 6 to February 10, and then 379,000 shares between February 10 and 11. Likewise, Tianjin Lanchi sold 29,700 shares followed by 98,900 shares over the same time frameThe scale of these reductions illustrates a strategic exit from positions amidst market euphoria.
Moreover, on the evening of February 13, Qingyun Technology reported that another large stakeholder, Hengqin Zhaozheng Ruixin Investment Center, completed its own round of stock sales, offloading nearly 478,000 shares—1% of the company's total shares—by employing centralized bidding
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These actions indicate a strong sentiment among large investors to take profits while the going is goodTogether, the transactions marked a significant cash-out session for these shareholders, exceeding 51.62 million yuan for the combined holdings.
Despite the soaring stock price, Qingyun Technology is still reporting persistent lossesRecent earnings projections suggest that the company expects a net profit loss of 97.907 million yuan for 2024, albeit a decrease of 72.165 million yuan from the previous yearThis contradiction between rising stock prices and underlying financial health raises questions about the sustainability of these valuations in the long term.
In addition to Qingyun Technology, other companies within the sector have also witnessed high-profile shareholder sell-offsParallel Technology announced on February 11 that its major stakeholder, the Qingkong Yinxing Nantong Venture Capital Fund, divested 1.1646 million shares from January 23 to February 11, accumulating proceeds of 98.2023 million yuanOn February 13, Parallel Technology's stock was reported at a closing price of 252.85 yuan, up 17.06%, before reaching an intraday high of 279.66 yuan, signaling continued interest amid the volatility.
In a similar vein, Zhuhai Singularity also disclosed on February 10 that its controlling shareholders engaged in significant stock divestments during the same reporting period, totaling over 166,000 shares sold through centralized bidding and an additional 100,000 shares sold via block trades, illustrating the trend of high-volume sell-offs amidst soaring prices.
With the meteoric rise of DeepSeek, following the Lunar New Year, a rush to capitalize on the artificial market boom has swept through the A-share market, resulting in various stocks being branded as “DeepSeek concept stocks,” often leading to sharp price increasesNevertheless, many of these so-called concept stocks merely scratched the surface of the underlying technology and its potential.
DeepSeek, recognized as an open-source large language model, allows users to conduct training and engage in personalized development for diverse applications
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However, the reality is that many listed companies have only made slight connections with DeepSeek technology, and most have not engaged in meaningful business collaborations.Data from Dongfang Caifu Choice reveals that over the past week, about 25 listed companies hurriedly issued clarifications regarding their association with DeepSeekSeveral remarked that they only incorporated DeepSeek into some of their products without formal service agreementsFor example, Qingyun Technology stated it has included DeepSeek in its offerings but does not have a business collaboration as suchSimilarly, Zhejiang Data Culture clarified that it has no direct or indirect equity ties with DeepSeek and has not established any business partnerships.
Further, some firms have emphasized the lack of equity relationships, especially those whose investment portfolios contain firms with names similar to DeepSeekZhejing Dongfang noted that its investment outlets, such as Beijing Deep Search Technology Co., Ltd. and Beijing Jiu Zhang Yun Ji Technology Co., Ltd., have no financial ties to DeepSeek.
On the other hand, a portion of companies has mentioned that while they have initiated the local deployment of DeepSeek, they have yet to generate significant profits or have seen very minimal revenues from itDragonSoft Technology explained that although it has implemented DeepSeek in its products, it is still in the research and development phase and has not generated revenue, asserting that the impact on its overall business is negligibleLikewise, Yongxin Zhicheng stated that its AI model safety evaluation platform, which has integrated DeepSeek models, has had an insignificant bearing on the company’s operational profits to date.
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