#SKHynixADRIndicativePrice149

SK Hynix’s IPO Demand Is Further Proof The AI Trade Isn’t Even Close to Done. The chatter surrounding SK Hynix's listing in the U.S. Is actually an interesting signal for where smart money is focused these days. Even if only the ADR indication of $149 per share and the reported sevenx oversubscribed nature are telling of interest levels from institutions, they at least suggest some continuing conviction in the long-term AI infrastructure narrative.

One thing I look at above the total amount is who’s raising the money.

If long-only institutional and sovereign wealth fund money is flowing into an offering such as this, it generally signifies a long-term commitment, not short-term opportunism by trades looking to flip the position. The world needs to remember SK Hynix makes high-bandwidth memory (HBM), a key component of all advanced hardware where AI chips rely on speed - as AI continues to evolve to increasingly complex, large models and is further embedded into various computing applications, HBM will be in continued demand. In many cases, the companies building the infrastructure for artificial intelligence are, if anything, even more critical than the companies writing the software applications that receive all the press. A feature that I found very interesting was the premium for the U.S.

ADR offering, as several analysts predict that American investors are willing to pay up for the security.

This is a result of a lack of access to Korean equities by global institutional investors. It will be very interesting to see how this plays out post-IPO! As I like to say: “A good company doesn’t always make for a good stock.”

There is so much expectation building in all of the AI space that, if we start seeing even slight decelerations in the trajectory of growth, you’ll see significant volatility. Yet, long term, I continue to believe the opportunity for investing in the infrastructure of AI is simply massive. This offering seems like yet another clear indication that it’s still institutional capital that believes in the long-term opportunity to invest in the building blocks of the future.

‍#AI #GateSquare