The American Depository Receipts (ADRs) of SK Hynix ended 13% higher on Friday, after the largest ever share sale by a foreign company on Wall Street. SK Hynix raised $26.5 billion through its IPO, where it priced shares at $149 apiece.
Analysts tracking the stock said that the New York momentum is already priced in the stock and it may face heavy intraday profit-booking and arbitrage unwinding.
SK Hynix is among the major supplier of high-bandwidth memory to work with Nvidia’s AI processors.
Despite the stock surging over 700% over the last 12 months, the IPO on Wall Street was subscribed 7x the total number of shares on offer.
The US closing price takes the ADR to a premium of nearly 15% from the Korea-listed shares. One ADR is equivalent to a tenth of the main entity listed in Seoul.
Alongside SK Hynix, the shares of its peer and rival Samsung Electronics are also trading with losses of close to 5% on Monday.
Both the stocks have a significant weightage on the KOSPI and as a result of the fall seen in them, the index is also trading with losses of over 4.5% to begin the week on a negative note. The index is now down 24% from its recent record high of 9,381, which it had surged to in June.
(With Inputs From Agencies.)
