As a highly sought-after AI sub-sector in today's primary market, embodied AI has even eclipsed the large language model sector in terms of financing momentum. However, institutions that made early investments are now grappling with exit challenges in the Hong Kong stock market. This year, 13 robotics companies have gone public in Hong Kong, with eight of them either breaking even or falling below that mark. The cornerstone investors in these companies have collectively poured in nearly HK$4.9 billion, only to face theoretical net floating losses exceeding HK$800 million at present.

Most cornerstone investors are still within a lock-up period of approximately six months. Meanwhile, the floating losses for cornerstone investors in two companies, whose lock-up periods have already expired, continue to escalate. The median book return rates for venture capital firms that invested even earlier also remain lackluster, with the median book return rate per share in the final financing rounds of 12 companies standing at a mere 70.4%. Should stock prices plummet by another 40%, book returns would dwindle to zero.

Moreover, the robotics sector in the Hong Kong stock market is plagued by severe liquidity shortages. Eight companies in this sector report average daily trading volumes of less than HK$20 million. The median time required for institutions to fully divest their holdings stretches up to two years, and for some companies, it could take over a decade for institutional investors to completely offload their positions.

As a surge of robotics companies prepares to go public in Hong Kong, the pressure on the secondary market to absorb these new listings intensifies further, transforming this capital extravaganza into a protracted exit challenge.