Baidu (BIDU) Surges 6% on Kunlunxin Spin-Off and Dubai Permit—Is This the Start of a New Bull Run?

Summary
• Baidu (BIDU) rockets 5.99% intraday, hitting a 52-week high of $153.14
• Kunlunxin AI chip spin-off and Dubai robotaxi permit drive renewed optimism
• Analysts split on valuation: $152 fair value vs. $102 DCF estimate

Baidu’s (BIDU) explosive 6% rally on January 12, 2026, has thrust the tech giant into the spotlight. The stock surged past its 52-week high of $153.14 amid a dual catalyst: a confidential Hong Kong listing for its Kunlunxin AI chip unit and Apollo Go’s Dubai autonomous driving permit. With a dynamic PE of 73.35 and a 5.99% intraday gain, the move reflects a sharp shift in sentiment toward Baidu’s AI-driven growth narrative.

Kunlunxin Spin-Off and Dubai Permit Drive Baidu’s Rally
Baidu’s (BIDU) 6% intraday surge is directly tied to two strategic developments. First, the planned spin-off of Kunlunxin, its AI chip division, via a Hong Kong IPO signals a capital-efficient path to scale its semiconductor ambitions. Second, Apollo Go’s Dubai permit for fully driverless trials—coupled with a local operations hub—validates Baidu’s autonomous driving technology in a high-growth market. These moves align with analyst forecasts of recurring revenue streams from AI and cloud partnerships, temporarily overshadowing concerns about margin pressures from heavy R&D spending.

Semiconductor Sector Gains Momentum as Baidu Surpasses NVDA
Baidu’s (BIDU) 5.99% gain outpaces the semiconductor sector’s leader, Nvidia (NVDA), which rose 1.00% intraday. The broader sector benefits from AI infrastructure demand, but Baidu’s dual catalysts—hardware (Kunlunxin) and software (Apollo Go)—position it uniquely. Leveraged ETFs like KraneShares 2x Long BIDU ETF (KBDU, +12.75%) and Leverage Shares 2X Long BIDU ETF (BIDG, +12.33%) reflect amplified exposure to Baidu’s momentum, contrasting with the sector’s broader focus on chipmakers.

KraneShares 2x Long BIDU ETF and High-Leverage Options Signal Aggressive Bullish Play
• KraneShares 2x Long BIDU ETF (KBDU): 12.75% intraday gain, 2x leverage on BIDU
• Leverage Shares 2X Long BIDU ETF (BIDG): 12.33% intraday gain, 2x leverage on BIDU
• 200-day MA: $104.46 (below current price), RSI: 74.29 (overbought), MACD: 6.24 (bullish), Bollinger Upper: $153.01 (near-term resistance)

Baidu’s (BIDU) technicals suggest a continuation of its bullish trend. The stock trades near its 52-week high of $153.14, with RSI at overbought levels and MACD above zero. The KraneShares 2x Long BIDU ETF (KBDU) and Leverage Shares 2X Long BIDU ETF (BIDG) offer amplified exposure to this momentum. For options, two contracts stand out:

• BIDU20260116C143
- Call Option, Strike: $143, Expiry: 2026-01-16
- IV: 57.28% (moderate), LVR: 14.53% (high), Delta: 0.8429 (deep in-the-money), Theta: -1.233 (high time decay), Gamma: 0.0235 (high sensitivity), Turnover: 22,343
- Payoff at 5% upside (ST = $159.74): $6.74/share. This contract offers high leverage and liquidity, ideal for capitalizing on a short-term breakout.

• BIDU20260116C144
- Call Option, Strike: $144, Expiry: 2026-01-16
- IV: 51.97% (moderate), LVR: 18.38% (very high), Delta: 0.8385 (deep in-the-money), Theta: -1.2175 (high time decay), Gamma: 0.0264 (high sensitivity), Turnover: 15,224
- Payoff at 5% upside (ST = $159.74): $5.74/share. This option’s extreme leverage and high gamma make it a high-risk, high-reward play for aggressive bulls.

Trading Setup: Target a breakout above $153.01 (Bollinger Upper) with a stop-loss near $147.57 (intraday low). The KraneShares ETF (KBDU) offers a safer leveraged bet, while the options (BIDU20260116C143/C144) suit high-conviction traders. If $153.01 holds, Baidu could retest its 200-day MA of $104.46 as a long-term baseline.

Backtest Baidu Stock Performance
The backtest of BIDU's performance following a 6% intraday increase from 2022 to now reveals a significant underperformance. The strategy's CAGR is -3.80%, with a total return of -14.11% and an excess return of -57.08%. This suggests that while the intraday surge was triggered, it did not lead to positive long-term gains. The strategy had a maximum drawdown of 0.00% and a Sharpe ratio of -0.07, indicating a risk-averse approach but one that failed to capitalize on broader market gains.

Baidu’s Bull Run Gains Steam—Act Now Before Volatility Peaks
Baidu’s (BIDU) 6% surge is a testament to its AI-driven transformation, but valuation splits between $152 and $102 highlight risks. The stock’s proximity to its 52-week high and overbought RSI suggest a potential pullback, yet the Kunlunxin spin-off and Dubai permit justify optimism. For investors, the KraneShares 2x Long BIDU ETF (KBDU, +12.75%) and the BIDU20260116C143 call option offer amplified exposure to this momentum. Watch for a breakdown below $147.57 (intraday low) or a breakout above $153.01 (Bollinger Upper). If the semiconductor sector leader, Nvidia (NVDA, +1.00%), continues to underperform, Baidu’s AI narrative could gain further traction.