The South Korean chip manufacturer SK Hynix has seen an exponential rise of 14% in its Nasdaq debut due to soaring demand for AI chips.
With its U.S.-listed shares rising 14% after completing a $26.5 billion share sale, reflecting continued investor confidence in artificial intelligence (AI)-related stocks.
The company's American depositary receipts (ADRs), with 10 ADRs representing one common share, opened at $170, up from the $149 offer price.
The actual offering price was nearly 2.7% higher as compared to the stock's average closing price over the previous three trading sessions in Seoul.
Despite an ongoing volatility in semiconductor stocks, investors continue to show a significant interest in companies likely to benefit from the AI boom.
Previously, SK Hynix shares saw a sharp decline of nearly 25% from a record high reached two weeks ago, but they remain nearly 630% higher as compared to a year ago.
As per some credible market analysts, strong debut suggests great enthusiasm for the AI-related chip manufacturers remains intact despite concerns over slowing AI spending.
A report suggested the U.S. share sale was more than seven times oversubscribed, and is the second-largest U.S. equity offering after SpaceX's record IPO last month.
The listing will provide SK Hynix with funds to expand its manufacturing capacity by building new factories while giving the company direct access to U.S. investors, the world's largest capital market.
Some analysts also believe the Nasdaq listing could assist in narrowing the valuation gap between SK Hynix and U.S.-based rivals, as American semiconductor companies generally trade at higher valuations than their South Korean counterparts.
SK Hynix is considered one of the world's leading memory chip manufacturers and is expected to remain a key supplier as demand for AI-powered data centers and advanced computing continues to grow.
