China's Zhongji Innolight Co. has begun gauging investor demand for a potential Hong Kong initial public offering that could raise up to $8 billion, according to deal terms seen by Bloomberg News. The optical transceiver manufacturer is taking concrete steps toward what may become the city's largest first-time share sale in seven years.

The Shenzhen-based company, a key supplier for global data center operators, is working with advisors to assess market appetite for the listing. Preliminary discussions suggest the offering could value the firm significantly above its current Shenzhen-listed market capitalization, reflecting strong investor interest in AI-driven optical networking infrastructure.

If successful, the deal would mark a major milestone for Hong Kong's capital markets, which have seen reduced IPO activity amid geopolitical tensions and economic uncertainty. The listing would also provide Zhongji Innolight with additional capital to expand production capacity for high-speed optical modules critical to generative AI workloads.

Bloomberg reports that the timeline remains fluid, with the company yet to file a formal listing application. Market conditions and regulatory approvals will ultimately determine the final size and scheduling of what could be a landmark offering for both the company and the exchange.