* First-quarter profit nearly quadrupled
* U.S. supplied most revenue
* Company flags U.S. military-list risk
(Adds approval by Chinese securities regulator in paragraph 6)
HONG KONG/SINGAPORE, July 17 (Reuters) – China’s Zhongji
Innolight moved closer to a Hong Kong share sale
after publishing its post-hearing draft prospectus on Friday,
giving investors fresh details on its rapid growth and
U.S.-related risks.
The Shenzhen-listed company makes optical modules used in
artificial intelligence data centres. These parts help move
large amounts of data quickly between computer servers.
Zhongji aims to raise up to $7 billion in its Hong Kong
listing, sources told Reuters in June. At that size, the deal
would surpass Luxshare Precision’s $3.1 billion share sale on
July 6 to become Hong Kong’s largest listing this year,
according to LSEG data.
The company could launch its bookbuilding next week and make
its Hong Kong market debut in the first week of August, said a
source with direct knowledge of the matter, who added that the
timeline could change based on market conditions. The source
declined to be named because the information was not public.
Zhongji did not immediately respond to a request for comment
on Friday.
Chinese securities regulator had approved the firm’s Hong
Kong listing plan on July 8, a statement released by the China
Securities Regulatory Commission showed on Friday.
Zhongji’s filing comes as AI-related shares have faced a
sharp pullback of late. A chip selloff hit global markets on
Friday, while Chinese stocks fell as memory chipmaker CXMT’s
planned $8.6 billion IPO raised concern that large new listings
could drain funds from the markets.
Companies have raised $33.8 billion from new listings in
Hong Kong so far in 2026, a record year-to-date total based on
LSEG data. That is more than double the $16.4 billion raised in
the year-earlier period in 2025.
Zhongji said it has been the world’s largest optical
interconnect solutions provider by revenue for five straight
years since 2021, citing industry consultant CIC in its draft
prospectus.
Its revenue rose 192% to 19.5 billion yuan ($2.9 billion) in
the three months ended March 31, while profit jumped 274% to
6.32 billion yuan, its draft prospectus showed.
Its 2025 profit rose 116% to 11.58 billion yuan on revenue
of 38.24 billion yuan, according to the draft prospectus.
In its filing, Zhongji said it planned to use the listing
proceeds for research and development, global production
expansion, supply chain work, strategic acquisitions and general
working capital. The deal size, pricing and timetable were not
disclosed.
U.S. RISK
The U.S. accounted for 61.7% of Zhongji’s revenue in the
first quarter, up from 57.3% for all of 2025, the draft
prospectus showed.
Zhongji said the U.S. Department of Defense added the
company to its Chinese military companies list on June 8.
The company said the list was not an economic sanctions list
and did not by itself restrict its business with U.S. customers
or trading in its securities.
It said it had not seen any material customer order
cancellations, suspensions, reductions or delays since it was
added to the list. Zhongji said its products were made for
commercial technology and not for military use.
Zhongji said in a separate filing that it had appointed
Goldman Sachs, CICC, Morgan Stanley, GF Securities, Haitong
International, Citi, HSBC and China Galaxy International as
overall coordinators for its listing.
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