Investor demand for chip companies continues to be robust.
SK Hynix is giving U.S. investors an opportunity to participate in the semiconductor rally.
On July 9, the South Korean memory-chip giant raised $26.5 billion, pricing its American Depositary Receipts—also known as ADRs—at $149. Each American depositary share equals one-tenth of a Seoul-traded common share.
Shares of SK Hynix are set to debut on Nasdaq during the end-of-week session.
“I’d like to thank our investors and customers for their trust and support,” CEO Kwak Noh-Jung said in a statement.
“Through continuous innovation, we will push the boundaries of what memory can achieve while empowering our employees to reach even greater accomplishments.
“SK hynix seeks to be wherever AI is, continually demonstrating our technology leadership.”
The company’s U.S. share sale surpassed the debuts of Saudi Aramco and Alibaba as the largest listing by a foreign company in the United States, indicating ferocious investor appetite at a time when the chip trade is red hot.
“Just like the SpaceX [initial public offering], we are seeing a similar trend with SK Hynix. We’re seeing here a very strong and persistent demand for leading companies that are driving AI forward,” Evan Schlossman, principal at Neostellar, said in an emailed note to The Epoch Times.
Back home, SK Hynix is the second most valuable company, behind Samsung. The stock is up more than 200 percent this year, hitting the trillion-dollar market cap threshold in May.
But traders pursuing the so-called Korean Discount—companies in Seoul trading at lower valuations than international competitors—might be disappointed.
Dubbed the “RAMageddon” by industry experts, the world is facing a memory chip shortage, forcing makers to ramp up production. As a result, Wall Street has been enamored with scores of chip producers, including Broadcom, Intel, Micron Technology, and Nvidia.
The ultra-popular iShares Semiconductor exchange-traded fund is up more than 80 percent this year, although it is poised for a weekly loss of about 1 percent.
“When we look at AI infrastructure and the demand that is starved really out there for right now in the market. You’re seeing a huge amount of demand, and capex estimates,” Schlossman said.
By Andrew Moran
