(Yicai Global) Dec. 30 -- Shares in SenseTime Group surged as much as 23 percent today after the Chinese artificial intelligence giant finally went public on the Hong Kong Stock Exchange after the initial date was pushed back two weeks after the company was added to a US government blacklist.

SenseTime’s share price [HKG:0020] closed at HKD4.13 (USD0.53), a gain of 7.27 percent from its issue price of HKD3.85, giving it a market capitalization of HKD137.4 billion (USD17.6 billion). Earlier in the day the stock had reached USD4.74 apiece.

The phrase ‘artificial intelligence’ that was first coined in 1956 has now become a universally applied technology and a basic infrastructure of this era, said co-founder, Chairman and Chief Executive Officer Xu Li at the listing ceremony. AI is expanding mankind’s perception of the world though AI-driven computing devices and breakthroughs in Big Data technology, he added.

The initial public offering brought in a haul of HKD5.78 billion (USD740.5 million). Sixty percent of the proceeds will be used in research and development to improve SenseTime's computing power, AI chip design and to develop new products, the firm said in its IPO prospectus. Fifteen percent will be invested in emerging businesses and its various smart platforms, another 15 percent will go towards strategic acquisitions and the rest will be used to supplement working capital.

SenseTime suspended the IPO on Dec. 13 after the US Treasury Department announced on Dec. 10 that it was adding the firm to a list of “Chinese military-industrial complex companies,” thereby preventing US investors from investing in the AI startup. It is the second time that the US has added SenseTime to the blacklist.

As a result, Hong Kong-based SenseTime had to remove its overseas cornerstone investors, which included Pleiad Investment Advisors, WT Funds, Focustar Capital and Hel Ved Capital Management, and replace them with Chinese anchor investors such as Shanghai Xuhui Capital, Guotai Junan Securities, HKSTP Venture Fund, C-Mer Eye Care Holdings and Taizhou Culture and Tourism.

Among global unicorns ranked by value, SenseTime is second only to San Francisco-based Grammarly, an annual list compiled by the Hurun Research Institute showed yesterday. SenseTime is worth USD12 billion, according to the Global Unicorn Index 2021.

Mainly known for its face recognition technology, SenseTime has raised USD5.2 billion in 12 funding rounds since being set up in 2014 and has expanded into the fields of smart commerce, smart cities, smart life and smart autos. It was Asia’s largest AI firm by revenue last year with a market share of 14 percent, according to its prospectus.

Due to high spending on research and development, SenseTime has never made a profit. It racked up losses of CNY3.71 billion (USD582 million) in the first half on revenue of CNY1.65 billion (USD259.41 million). And last year it rang up losses of CNY12.1 billion (USD1.9 billion) on revenue of CNY3.45 billion.

Editor: Kim Taylor