At the beginning of 2025, the domestic large model DeepSeek caused a huge stir in the global technology market.

As a domestic AI large model, DeepSeek is characterized by low cost, high performance, and open-source, immediately taking a prominent position in the global network. Some opinions suggest that DeepSeek's advantages in low cost and high performance have caused market fluctuations, potentially prompting investors to reassess the technological potential of Chinese technology companies in the AI sector.

Goldman Sachs' latest report points out that the rise of DeepSeek means that the development of the AI industry is shifting from the hardware infrastructure layer to the software application layer. This trend not only impacts 'American exceptionalism' but also provides new opportunities for diversified development in the global market, especially for Chinese concept technology stocks.

Among them, the famous Goldman Sachs AI "basket" stock index has officially launched GS HK Listed AI Beneficiaries, citing that attention to Chinese AI should increase following DeepSeek.

This includes $TENCENT (00700.HK)$ 、 $BABA-W (09988.HK)$ 、 $NTES-S (09999.HK)$ 、 $JD-SW (09618.HK)$ 、 $BIDU-SW (09888.HK)$ 、 $KUAISHOU-W (01024.HK)$ 、 $SENSETIME-W (00020.HK)$ 、 $KINGSOFT CLOUD (03896.HK)$ 、 $WEIMOB INC (02013.HK)$ 、 $BILIBILI-W (09626.HK)$ 、 $XIAOMI-W (01810.HK)$ 、 $KINGSOFT (03888.HK)$ 、 $FOURTH PARADIGM (06682.HK)$ 、 $MEITU (01357.HK)$ 、 $KINGDEE INT'L (00268.HK)$ 、 $HORIZONROBOT-W (09660.HK)$ 、 $CHINASOFT INT'L (00354.HK)$ 、 $CHINA LIT (00772.HK)$ 、 $GDS-SW (09698.HK)$ 、 $XD INC (02400.HK)$ Including 20 other companies.

It is worth noting that these companies have seen significant increases since DeepSeek became popular, with Kingsoft Cloud and MEITU rising over 45% cumulatively in five days, while KINGSOFT, GDS Holdings, and others rose about 20%.

Goldman Sachs also believes that Chinese concept stocks have a wide layout in the AI application layer, covering multiple fields such as natural language processing, computer vision, machine learning, etc. For example, $TENCENT (00700.HK)$ 、$Alibaba (BABA.US)$and$Baidu (BIDU.US)$Internet giants have made significant progress in the field of AI applications. The high exposure of these companies in the AI application layer is expected to lead to better short-term performance compared to those primarily focused on Hardware and Semiconductors.

GTJA stated that great attention should be paid to the breakthroughs of China's DeepSeek. Its innovations signify that China's AI development has entered an important turning point, with implications not only for bridging the AI gap between China and the USA, but more importantly, for creating commercial opportunities and a consensus among social capital and public sentiment. This forms the cornerstone for Chinese tech companies to undergo re-evaluation and the establishment of the 2025 technology 'transformation bull' main line.

Morgan Stanley also mentioned that this model achieves similar performance at training costs far lower than GPT, which could have a profound impact on China's Datacenter and Software Industry. The firm noted that in the short term, if large tech companies adopt a technology path similar to DeepSeek, it may reduce the demand related to AI model training in the Datacenter sector. In the long run, low-cost models may drive growth in inference demand. Additionally, due to the reduced costs, it could bring selective slight Bullish sentiment to the Software Industry.

AVIC Securities believes that as the cost of using models decreases, AI applications will become more numerous, leading to intensified competition, with a higher moat for PaaS services as development tools. With the global effects triggered by DeepSeek, the value of domestic tech companies in our country is expected to gain higher visibility.

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Editor/Somer