Lyon: Maintain Z.AI (02513) "Outperform the Market" rating with a target price of HKD 2061.

Citi released a research report stating that the recent weakness in stock prices may be an overreaction from the market to the slowdown in annual recurring revenue for Anthropic. They maintain a "Outperform" rating for Z.AI (02513) with a target price of 2061 Hong Kong dollars. Z.AI GLM-5.3 API is now open for calls, demonstrating leading performance among domestic peers in complex coding and long-cycle agent tasks. Although its parameter scale is smaller, it has achieved state-of-the-art performance in various benchmark tests and scored 60 in the Artificial Analysis Intelligence Index. Citi noted that the performance enhancement of GLM 5.3 comes from a more extensive environment and diverse tasks during the post-training phase, extending into production workflows. Since mid-2025, post-training expansion has increasingly relied on executable and verifiable settings, which they believe validates Z.AI's strength in end-to-end synthetic environment construction pipelines. The firm estimates that the revenue share of the GLM model from OpenRouter has risen from 1% in January this year to 7% in July. They believe that DeepSeek's recent price increase reflects a healthy industry competition, and GLM 5.3 has regained its position on the Pareto Frontier.