SK Hynix's listing in the United States triggers a demonstration effect! Samsung denies evaluating ADR issuance, is it a good opportunity to bottom out for the storage chip sector?

After SK Hynix, one of the giants in storage chip market, completed a 265 billion US dollar ADR issuance in the US stock market at $149 per share, there are reports that another storage giant in South Korea, Samsung Electronics, seems to be considering raising a huge amount of funds through a US stock issuance and breaking the so-called "undervaluation of South Korean technology companies". However, a representative of Samsung Electronics stated that the possibility of issuing American Depositary Receipts (ADRs) is currently not being evaluated. Earlier, media reports citing insiders revealed that Samsung Electronics is in the early stages of studying the potential issuance of American Depositary Receipts (ADRs). Insiders said that the South Korean company has had preliminary discussions with banks but has not yet decided whether to proceed. As the discussions are confidential, the insiders requested anonymity. They mentioned that Samsung will pay attention to the volatile fluctuations in global storage chip stocks when making a decision. Insiders said that if the company goes ahead with the US listing, its large consumer electronics business portfolio and recurring labor disputes could pose significant challenges to the transaction structure. They added that the discussions are still in a very early stage and may not ultimately lead to a listing. Following the close of the South Korean stock market on Monday, SK Hynix saw a record drop of over 15% in a single day, while Samsung Electronics fell by over 10%, dragging down the KOSPI benchmark index by about 9% and triggering a trading halt. On Tuesday, the KOSPI index, as well as the prices of SK Hynix and Samsung Electronics, which account for 50% of the index, rebounded, with some Wall Street analysts who continue to be optimistic about the storage chip sector suggesting that the "chip cycle has not yet peaked" is baseless. They believe that buying opportunities in storage chip stocks are emerging, especially as SK Hynix has fallen by nearly 40% from its high. The South Korean government announced this week that the excess tax revenue generated by the AI infrastructure-driven storage chip boom will be invested into cutting-edge technologies such as semiconductors, AI data centers, and physical artificial intelligence (physical AI). This move largely reinforces the government's massive policy commitment to long-term AI computing infrastructure development, which is expected to stabilize and boost capital expenditure expectations surrounding Samsung Electronics, SK Hynix, and the global AI computing industry chain, sending a positive signal to the market that the "AI computing industry cycle has not yet been judged to have peaked". SK Hynix's $26.5 billion US listing sparked a demonstration effect, prompting South Korea's storage chip giants to compete for global AI capital. According to sources familiar with the matter, Samsung had previously evaluated the possibility of issuing American Depositary Receipts but ultimately decided not to proceed; However, SK Hynix's successful listing on the US stock market and the potential to break the so-called "undervaluation of South Korean technology companies" provide new impetus for Samsung to reconsider this idea. The discussions are still in an extremely early stage, with more of an evaluation at present than a concrete plan or the appointment of banks to handle the issuance. As a competitor of Samsung in the storage chip market, SK Hynix raised $26.5 billion last week through a US listing, making it the largest overseas listing transaction in history. This transaction reflects investors' demand for companies positioned at the core of global AI computing infrastructure, even as concerns mount that AI supply chain valuations may be overstated. Samsung's stock price in the South Korean market has risen by about 120% so far this year, pushing the company's market value past $1 trillion. In comparison, SK Hynix's stock price has surged over 200% during the same period, with a market value of around $900 billion.