In recent discussions concerning the state of one of China's most significant tech entities, Huawei, remarks made by Shiao Yu, a researcher at the National Financial and Development Laboratory, have sparked spirited debateDuring his presentation at the 2025 China Chief Economist Forum, he posited that if Huawei were to go public, its market capitalization could soar to an astounding figure, one equal to the sum of tech giants Tesla, Apple, and NVIDIAThis grand prediction quickly garnered attention and raised eyebrows within the financial community.

It’s undeniable that Huawei has established itself as a powerhouse in the tech industry, and should it choose to pursue an IPO, it would undoubtedly make a significant impact on the market, potentially landing among the highest-valued companies listed in ChinaHowever, to claim that its value could rival the combined market caps of Apple, NVIDIA, and Tesla appears highly exaggerated

Satirical remarks began circulating about the economist possibly indulging in a bit too much Moutai before taking the stage.

To understand the veracity of such claims, it’s essential to examine the current market standings of these leading companiesAs of January 7, Apple holds the title of the world’s most valuable company with a market cap of $3.7 trillion, followed closely by NVIDIA, which has surged in recent years on the back of the burgeoning AI sector, now valued at approximately $3.4 trillionNot to be overlooked, Tesla, founded by Elon Musk, maintains a robust presence with a valuation of around $1.3 trillion, ensuring it continues to rank among the top ten global corporations.

For Huawei to surpass the total market capitalization of these three behemoths, it would necessitate a staggering figure of $8.4 trillion—nearly 61 trillion yuan—which approaches half of China’s GDP

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Anyone with a fundamental understanding of economics might find it ludicrous to suggest that Huawei could be valued at an amount so closely resembling half of an entire nation’s economic output.

So, in a more realistic scenario, if Huawei were to go public today, what would be a fair market cap estimate for this tech titan? It may disappoint some to hear that its value would likely not even approach half that of the lowest valued company among the trio, which is Tesla.

To delve deeper, examining the leading Chinese public companies provides contextThe highest market cap currently belongs to Tencent, which trades on the Hong Kong Stock Exchange, valued at 3.5 trillion HKD—translating to approximately 3.3 trillion yuan or about $450 billion USD.

When assessing a mature company's valuation, net profit stands as a vital indicator

In 2023, Tencent reported a net profit of 115.2 billion yuan, with a notable increase projected for the first three quarters of 2024, totaling 142.7 billion yuanIn contrast, Huawei’s net profit figures from the same periods were 87 billion yuan and 62.9 billion yuan, respectively.

Regardless of whether one focuses on the entire year or just the initial quarters of 2024, there exists a palpable profit gap between Huawei and TencentNotably, in 2024, this gap is not only persistent but has notably widened compared to prior years.

Huawei’s peak profit year was in 2021, when it reached 113.7 billion yuan; however, Tencent eclipsed that figure, achieving a remarkable 224.8 billion yuan in net profitThis reiterates that even in pre-sanction days, Huawei’s profitability was still overshadowed by Tencent.

From this perspective, a reasonable estimate for Huawei's market cap, if operationally sound and public, would likely be just 50% to 80% of Tencent’s valuation, suggesting figures between $230 billion and $360 billion—averaging out to about $300 billion.

Taking a different analytical route also provides insight into Huawei’s potential market valuation

Consider Cisco, a corporation closely aligned with Huawei’s core business of communications equipmentCisco reported a net profit of $10.32 billion recently, around 75.3 billion yuan, roughly on par with Huawei's 2023 net earnings, likely indicating similar figures for 2024's profits.

Cisco's current market capitalization stands at $234.7 billionWhile Huawei would certainly exceed Cisco's figures, it would not be multiples greater, thus reinforcing previous estimates falling within the specified range.

However, it's essential to remember that a valuation isn't solely derived from profit figures; market dynamics and investor sentiment also play pivotal rolesGiven Huawei’s esteemed position in the hearts of the Chinese populace, should it eventually list publicly, the company would likely experience a rush of investment from institutions, speculative funds, and retail investors alike, which could elevate its market cap beyond the estimated median of $300 billion, possibly reaching a peak around $360 billion

In extreme scenarios, even matching Tencent’s current valuation would remain unlikely to breach the $450 billion mark.

To recap the prior reference points, the combined market capitalizations of Apple, NVIDIA, and Tesla rest at a whopping $8.4 trillion—far from comparable to the aforementioned figures.

Many might argue that a market cap estimate of merely $300 to $400 billion undervalues HuaweiHowever, to frame this correctly, these valuation figures are no small potatoes within the global contextConsider Xiaomi, which recently achieved a record high in share price following its Hong Kong IPO, pushing its market cap to approximately 900 billion HKD or just over $100 billion USDThis means that $300 billion could hypothetically cover the value of three Xiaomis, a figure that reflects substantial market strength.

Huawei undeniably represents a significant force within the tech landscape, holding tremendous intrinsic value