SK Hynix Starts Trading on Nasdaq, Opens 14% Above Offer Price

**SPEAKER_2** (0:02)
Bloomberg Audio Studios, podcasts, radio, news. Bloomberg Tech is live from the heart of Silicon Valley with Ed Ludlow in San Francisco.

**David Gura** (0:21)
Welcome to a special edition of Bloomberg Tech. I'm David Gura, in for Ed Ludlow, who I should say is not far away. He is down at the Nasdaq, because all eyes are on SK Hynix's US listing today. This, the biggest ever US listing by a foreign company, and we are gearing up on this Friday. Just want to take a look at shares of the Nasdaq 100 down this morning, the Semiconductor Index down as well. Stocks really wavering here ahead of the debut of this listing on the Nasdaq. Want to look at some chip stocks as well, some rivals of SK Hynix if we can. Of course, a lot of interest in sort of where they are, how they're performing on this Friday. Micron down 1.3%, Intel down 2.9%.
NVIDIA up slightly again on this Friday. Want to get some context here, some perspective from Bailey Lipschultz. He's a Bloomberg Tech Equity Reporter along with Vandeep Singh, who's a Senior Analyst at Bloomberg Intelligence. Bailey, let me start with you. The offering price here, $149. The indications are this is going to open at $175. What does that tell you? Just walk us through what we can expect here in the minutes and hours ahead.

**Bailey Lipschultz** (1:20)
David, it shows us that the reporting we had last night that there were $200 billion of demand is pretty darn online. The main thing to keep in mind is indications are only that. When we saw SpaceX go public, the indications were it opened up 30% and ultimately opened up 10% or 11%.
So these numbers can move around quite quickly. The main thing to keep in mind, this is a record setting listing for a foreign company here in the US. This is a big deal. Again, it was more than seven times oversubscribed. It drew in interest from fundamental investors as well as our typical IPO buyers. The one thing to keep in mind throughout today and really going into next week, we are looking at a company that is a new listing here in the US. So, limited supply available for investors. As you can see, 117.9 million ADRs. Not really a lot of shares available relative to the float, so you can be bracing for some volatility that is outsized against the tape that has seen semiconductors really moving pretty sharply in either direction for the last few months.

**David Gura** (2:22)
Noting that volatility even as we wait for the open here. And Mandeep Singh, let me turn to you and just ask you about the motivations for the South Korean company to get into the US capital markets. Simply more access to cash? Does it say something about their designs, their eagerness to get into the US market more fully? How do you read what they're doing here today at the Nasdaq?

**Mandeep Singh** (2:39)
I almost feel like these companies have become more household names. You know, with this AI cycle, nobody knew about SK Hynix, you know, probably two, three years back. And suddenly everyone is talking about memory shortages and how these companies have fundamentals that can really last a while in terms of the durability of this cycle versus the prior cycles. And so from that perspective, you know, having the ADRs listed here will create more awareness among especially long-term investors who would want a piece of this. And I think the timing seems to be perfect for the listing here.

**David Gura** (3:20)
Maybe not a household name, but a big part of the pantheon of memory providers here, situated for us, if you would. So you've got SK Hynix, you've got Samsung, you've got Micron as well. Where is it in that universe?

**Mandeep Singh** (3:33)
Well, so I look at SK Hynix as one of the primary providers to an NVIDIA. So even though it's an oligopoly with three players, but when you look at which of the three NVIDIA has used the most for their architecture so far, it's been SK Hynix. And that's why in their IPO document, they say they have a 57% share in HPM. And HPM is where you can make a direct connection to the AI data center footprint. So from that perspective, I do think the NVIDIA aspect is huge when it comes to this listing.

**David Gura** (4:11)
Bailey, I want to ask you about what the price of this is relative to the stock trading on the South Korean market. So there's no discount here if you're to buy the ADR on the NASDAQ today. What does that tell you about this company's confidence?