Zhipu AI's stock is unattractive because the Chinese AI model space is simply too competitive to be an appealing investment. Its company vision still deserves respect, and its current valuation is not a bubble. x.com 

Zhipu, listed in Hong Kong as Knowledge Atlas Technology, has one of the most absurd valuations imaginable. It did about $105 million in revenue last year and lost more than four times that, yet the market valued it at roughly $128 billion this week, above 1,000x sales at the peak, on a float where barely 4% of the stock trades. Its open GLM-5.2 model may undercut Big Tech's AI moat, but valuation cannot be ignored forever. x.com 

Zhipu AI is a Chinese AI arbitrage, shipping models near frontier Western performance at a fraction of the valuation. Its GLM-5.1 scored 45.3 on a coding benchmark versus 47.9 for Claude Opus 4.6, a 2.6-point gap far smaller than the valuation gap. Zhipu is up 357% since its January IPO, double MiniMax's return, yet both trade at about $40B. x.com 

Meta's after-hours drop makes little sense, because Meta could become the default LLM for 90% of users. It has the talent, data and distribution and is spending $140B to own its AI infrastructure, while Anthropic is valued near $1 trillion. x.com 

Knowledge Atlas (Zhipu) could be a painful ride in the near term as its IPO lockup expires on July 7. The stock is already down 39% ahead of the expiry, though still up 12x year to date. x.com 

Alibaba offers opportunity at $123 as a front-runner in China's AI buildout, particularly if its AI spending shows real returns and it proves it can compete with the US. Over $56 billion of AI and cloud investment over three years has made current free cash flow negative, like US hyperscalers. Cloud growth is expected near 45%, AI products are already 30% of external cloud revenue, and it holds $38 billion of net cash. Cloud growth, capex and guidance will drive the earnings reaction. x.com 

Alibaba and Baidu are a no-brainer buy because Chinese AI stocks trade at very low valuations while China is determined to race the US in AI. x.com 

Baidu trades below book value, one of the best values seen in many years, with about $40 billion of equity against a $39 billion market cap. Legacy search is declining, but the cloud, AI and robotaxi businesses are very strong, and book value is a better value metric than an easily manipulated P/E. x.com  x.com 

Alibaba is the cleanest public-market bet that Chinese AI labs are innovating rather than just distilling, and that cheaper models drive more usage. If China is innovating, Qwen drives Alibaba Cloud share; if Jevons paradox holds, Alibaba captures the spend across models, compute, data, chips and apps. AI products are already 30% of Alibaba Cloud's external revenue, above a $5B run rate, and the commerce cash engine can carry it through the capex/revenue mismatch. x.com 

Alibaba's $10.2 billion Hong Kong share placement shows its cash burn has caught up with it, and more dilution is likely. Core China ecommerce makes roughly $30 billion of flat EBIT, half of it reinvested in quick commerce to defend share against PDD. Cloud and AI earns $2 billion of EBIT growing 35% but burns about $10 billion a year in AI-model opex. Pro forma EBIT of about $7 billion collapses after $20-25 billion of annual capex, so Alibaba will keep tapping equity markets. x.com