In this article, we will take a look at the 10 Best Performing Chinese Stocks So Far in 2025.
Chinese stocks have rallied in 2025 since the surprising launch of the DeepSeek AI model. The smart and lower-powered LLM AI tool has created a wave in the global AI industry, with the U.S. stock market losing over $1 trillion right after the DeepSeek launch.
Also Read: 10 Chinese Penny Stocks to Buy According to Analysts
China’s Ready to Embrace the Tech Sector
Chinese stocks have continued their momentum weeks after the launch of DeepSeek as China’s President Xi Jinping recently held meetings with Chinese tech and start-up leaders, indicating a more friendly approach to the sector. According to a Bloomberg report, the meeting included Alibaba co-founder Jack Ma and DeepSeek founder Liang Wenfeng. Ma’s presence was the highlight as investors saw it as a positive sign that Chinese officials were ready to embrace the tech sector. Ma has had a history with the Chinese government for speaking out against regulators, therefore, his presence is considered a symbolic gesture.
According to reports, Jinping has given a green signal to tech start-up leaders to remain competitive and ensured that the government would not impose unwarranted fines.
“The decision to call for such a meeting likely indicates the importance of technology innovation and the contribution of private enterprises to the development and growth of China’s economy. We view the emphasis on internet and tech providing valuation multiple support for China’s internet sector,” Citigroup analysts wrote in a research note, as per Bloomberg.
Despite the Chinese economy facing deflationary headwinds and a struggling property market, Hong Kong’s Hang Seng Index has surged over 15% year-to-date, driven by Chinese tech stocks.
Do Chinese tech stocks hold the potential to deliver a full-year rally driven by the AI boom, similar to the rally U.S. tech stocks experienced in 2024? Well, Chinese companies have the potential, and DeepSeek has proven what Chinese tech start-ups are capable of doing. However, China’s economy is in a very different place from the United States, and regulation can be difficult to predict.
With that said, let’s take a look at the 10 Best Performing Chinese Stocks So Far in 2025.
Our Methodology
We used the Finviz screener to shortlist 20 companies with a market capitalization of over $300 million. We ranked the 10 best-performing Chinese stocks with the highest returns year-to-date in ascending order of the YTD returns, as of February 19. We have also listed the number of hedge funds holding these stocks as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Performing Chinese Stocks So Far in 2025
10. Alibaba Group Holding Limited (NYSE:BABA)
No. of Hedge Fund Holders: 107
YTD Returns: 50.84%
Alibaba Group Holding Limited (NYSE:BABA) is a Chinese holding company with nine segments. The company serves the e-commerce retail segment in domestic and international markets. It also has businesses in local consumer services, logistics, cloud, digital media, and entertainment.
Alibaba just released Q3 2024 earnings, which surpassed the earnings and revenue estimates driven by strong year-end shopping sales and the success of its strategy to attract cost-conscious consumers. The company posted revenue of $38.58 billion or 280.15 billion yuan, beating estimates of $38.47 billion or 279.34 billion yuan.
Apart from the company’s strong performance in its core businesses, Alibaba is investing in AI. The company has revealed its AI model Qwen, advancing with the launch of the Qwen 2.5-VL model, which acts as an AI agent capable of controlling users devices, adding real-world utility to its technology. Alibaba’s strategic move to enter the Gen AI race, especially after its partnership with Apple on AI features, has placed it as a top contender in the AI space for 2025.
On February 17, Jefferies analyst Thomas Chong raised the price target on BABA shares from $150 to $156, keeping a Buy rating on the shares. The analyst is optimistic about Alibaba Group Holding Limited’s (NYSE:BABA) growing impact of AI advancements and cloud expansion. In addition, the Chinese e-commerce giant is expected to achieve 8-10% top-line growth through FY26, supported by rising adoption of Qwen’s models and accelerating demand for AI services.
9. Yiren Digital Ltd. (NYSE:YRD)
No. of Hedge Fund Holders: 2
YTD Returns: 56.03%
Yiren Digital Ltd. (NYSE:YRD) is a Chinese holding company mainly engaged in operating a digital personal financial management platform, wealth, credit, and financial solutions. The company’s two major segments include Wealth and Credit. Its third segment operates an electronic commerce business that offers products such as skincare and beauty, electronics, and appliances. The platform allows users to finance purchases through loan products while offering customized non-financial products and services.
Yiren Digital Ltd. (NYSE:YRD) has successfully integrated AI into daily operations, improving efficiency and customer experience. The company has also integrated Deepseek, affirming its commitment to pioneering AI-driven innovation in financial and lifestyle services in China.
The company is making massive strides in attracting loan volumes and with the addition of AI, things will get more efficient for YRD. In Q3 2024, Yiren Digital Ltd. saw a 36% year-over-year growth in total loan volumes, reported around 13.4 billion yuan. The company’s total premiums for its insurance brokerage business saw a 27% sequential growth. YRD has significantly improved its asset quality, supported by strong risk management and borrower optimization.
For Q4 FY2024, Yiren Digital Ltd. (NYSE:YRD) is expected to generate total revenue between 1.3 billion yuan and 1.5 billion yuan, with a healthy net profit margin.
