SK Hynix once fell 8.2% on the Korea Exchange; the company's American Depositary Receipts closed up 13% on the first day of listing on Friday. Korea Investment & Securities predicts that SK Hynix's operating profit for the second quarter may be 8% lower than market expectations because the company's revenue share from HBM is higher than that of its peers, limiting the room for average sales price growth. “Historically, due to foreign exchange and regulatory frictions, large global companies like TSMC usually have a structural valuation gap of about 15% between their local stocks and ADR,” said Jason Minsang Kam, head of active stock management at Kyobo Life Insurance in Seoul. Kam said that since the momentum of the New York market has already been digested by the market, the stock may face massive profit returns and arbitrage liquidation during the day, closing in a long-term shadow pattern. “SK Hynix's vision of turning memory into a 'customized solution service' through HBM is a solid long-term narrative. However, as Morgan Stanley and major investment banks have warned, memory is still essentially a cyclical commodity. The 'service provider' premium only exists when there is a shortage of supply.” The company's ADR had a premium of about 15% over its Korean stocks on Friday, according to the data.

SK Hynix once fell 8.2% on the Korea Exchange; the company's American Depositary Receipts closed up 13% on the first day of listing on Friday. Korea Investment & Securities predicts that SK Hynix's second-quarter operating profit may be 8% lower than market expectations because the company's revenue share from HBM is higher than that of its peers, limiting the room for average sales price growth. “Historically, due to foreign exchange and regulatory frictions, large global companies like TSMC usually have a structural valuation gap of about 15% between their local stocks and ADR,” said Jason Minsang Kam, head of active stock management at Kyobo Life Insurance in Seoul. Kam said that since the momentum of the New York market has already been digested by the market, the stock may face massive profit returns and arbitrage liquidation during the day, closing in a long-term shadow pattern. “SK Hynix's vision of turning memory into a 'customized solution service' through HBM is a solid long-term narrative. However, as Morgan Stanley and major investment banks have warned, memory is still essentially a cyclical commodity. The 'service provider' premium only exists when there is a shortage of supply.” The company's ADR had a premium of about 15% over its Korean stocks on Friday, according to the data.