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Unitree’s Robots Are Real. China’s Robotics Valuations Are the Problem.

The country’s leading robot manufacturer has customers, factories and profits. Its post-IPO collapse shows how far investor expectations have moved ahead of the technology.

On August 25, shares of Unitree Robotics, China’s best-known robot maker, were trading 45 per cent below their post-IPO high. The company had listed in Shanghai at a valuation of roughly $8.5 billion, only for its stock to surge 629.4 per cent on the first day, briefly making Unitree a $61.8 billion company. When almost half that value disappeared within a week, angry investors began asking whether Unitree itself was a bubble.

Some users compared Unitree founder Xingxing Wang with Hui Ka Yan, the founder of China Evergrande Group, whose property empire accumulated some $278 billion in liabilities before he was sentenced to life in prison. They argued that Wang was building a fraud of similar proportions.

But the sell-off says less about the quality of Unitree’s robots than about the market surrounding them. Unitree manufactures real products, earns a profit and leads China’s robotics industry. However, is that Unitree’s share price is no longer only about Unitree. The company has been forced into the role of pricing anchor for China’s entire humanoid-robot industry.

Unitree’s Stock Is Not Unitree

When a company’s shares rise more than sixfold, the natural assumption is that its founder must be celebrating a windfall. From my own encounters with Wang, that is not how he appears to see it.

At the 2025 World Robot Conference in Beijing, Wang attended a group interview with the media. As the session ended, a reporter asked how he viewed a potential IPO. He answered with characteristic reserve: “For us, an IPO is like the college entrance exam. It gives the company’s early investors a reasonably good outcome.”

Right up to the listing, Wang described going public primarily as a way to give venture investors an exit. What he clearly underestimated was the complexity of China’s secondary market—and, in particular, Shanghai’s STAR Market.

Launched in 2019, the STAR Market was designed to help frontier-technology companies raise capital. That mandate has also made the board a magnet for speculation. Regulators scrutinize applicants more closely, and relatively few are allowed through. In the first seven months of this year, just 21 companies listed in Shanghai, compared with 104 in Hong Kong.

The STAR Market comes with an elaborate set of guardrails intended to contain risk and keep the focus on fundraising:

- An IPO typically floats only a small portion of a company’s equity, often around 10%, limiting the ability of controlling shareholders to cash out early.

- Founding shareholders face a 36-month lockup, preventing founders with large stakes from freely selling their shares.

- Strategic placement investors, including national industrial funds and local state-owned investors, cannot exit easily.

- There is no daily price limit during a stock’s first five trading days, allowing institutions to establish a market price.

- Individual investors must hold at least about $69,000 in financial assets and have two years of investing experience to trade directly on the board.

Anyone familiar with equities will recognize the paradox: The restrictions meant to control risk can intensify the bubble. Few investors are eligible to trade, only a sliver of the company’s shares are liquid, and prices are unconstrained during the first five sessions. That combination encourages frantic turnover and sudden price spikes.

Unitree has 404 million shares outstanding. At the start of trading, only 30.09 million unrestricted shares were available, or 7.44% of the total. About 90% of the offering had been allocated offline. Eleven institutions submitted bids worth roughly $125 million over the course of a week and secured most of the shares on offer.

On its first day, Unitree’s turnover rate reached 85.28%, with $3.22 billion worth of shares changing hands. In effect, nearly the entire free float was recycled in a single session. Chinese trading data showed a net inflow of about $613 million through “extra-large” orders, while large and medium-size orders recorded net outflows of roughly $308 million and $304 million, respectively. It was the most extreme order-flow split anywhere in the A-share market that day.

The implication is hard to miss. Institutions and investors who received IPO allocations passed richly priced shares to individual buyers on day one. Once the supply of fresh money thinned out, the 629.4% rally could not hold. The subsequent 45% decline was dramatic, but it was also a move back toward something resembling a normal valuation.

Wang did little to keep the frenzy alive. On the second day of trading, he told the 2026 World Robot Conference that robotics may still be five to 10 years away from a “ChatGPT moment” in which machines can learn and improve autonomously. If he had wanted to inflate the bubble, he could hardly have chosen a less promotional message.

Another piece of the story has received little attention in Western coverage. On August 24, the Shanghai Stock Exchange held talks with brokerages and pressed them to tighten standards for loss-making, low-quality listing candidates. The new approach would favor the three leading companies in each industry and rely more heavily on invitations initiated by regulators, further reducing the number of businesses able to list.

In my view, this model will make the bubble in technology shares larger, not smaller. Look at the trading patterns of Cambricon Technologies, Moore Threads, MetaX and CXMT. On the STAR Market, a company with a pioneering technology or a dominant position in its industry can expect an extraordinary first-day surge simply because it made it through the gate.

From $8 Billion to $33 Billion

Before Unitree listed, I made a rough estimate of what the company might be worth.

Unitree reported 2025 revenue of about $236 million. Net income attributable to shareholders was approximately $38.6 million, while adjusted net income was around $82.1 million. Apply an earnings multiple of 60 to 80, assuming current margins hold, and the company would be worth roughly $4.9 billion to $6.9 billion. If profits continue to rise, the valuation could approach $8.3 billion. That is an optimistic estimate, but it is also broadly consistent with Unitree’s IPO valuation.

Another approach produces a similar result. On a trailing basis, battery giant CATL trades at about 25 times earnings, while surveillance-equipment maker Hikvision trades at about 22 times. Factor in Unitree’s growth of nearly 50% and assign it a premium for its dominant industry position, and a valuation of $7.6 billion to $8.7 billion looks defensible.

The market has moved far beyond that range. Even after the 45% drop, Unitree was still worth roughly $33.7 billion. If investors valued it only as a robot manufacturer, its market capitalization would be about 300% above a reasonable estimate.

Who is supporting such an extreme price? Once again, the answer is institutional capital. CCB International, using a target multiple of 32 times 2026 sales, arrived at a valuation of roughly $15.1 billion. Nomura gave the stock a buy rating and set a price target of about $51.40, implying a market value of approximately $20.8 billion. The STAR Market’s trading constraints can support a premium, so Unitree may plausibly remain worth more than $13.9 billion. A value of $33 billion, however, will be difficult to sustain.

Who, then, needs Unitree to be worth more than $27.8 billion? Wang has already supplied the answer: venture-capital investors.

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