SK Hynix Prices ADR; Defense and Biotech Stocks Diverge
SK Hynix priced its Nasdaq ADR at $149, roughly a 3.1% premium to Thursday's Korean market close. The stock jumped about 3% in after-hours trading immediately following the announcement. Institutional demand reached about seven times the offering, drawing over $2 billion in orders from more than 500 institutions, with the top 25 accounts taking 67% of the allocation. Each ADR represents 10 common shares, and ADRs cannot be directly exchanged for local shares. The underlying stock traded up 1-2% around 2.22 million won.
A heartwarming story about Samsung Electronics Chairman Lee Jae-yong also circulated: after a cleaning worker who had served at Samsung's Seocho headquarters for over two decades passed away, Lee reportedly cancelled his schedule to pay respects alone at the funeral, drawing praise for a shift in corporate culture.
Defense stocks were a focal point in a discussion with LS Securities analyst Lee Jae-kwang. Hanwha Aerospace and Hyundai Rotem already show solid earnings and margins, making their forward-looking valuations look comparatively low, while LIG Nex1 and Korea Aerospace Industries (KAI) appear undervalued when measured against order backlog relative to enterprise value. He cautioned against over-reading quarterly results in a project-based industry, advising investors instead to track order-backlog trends.
Biotech names diverged sharply. Peptron plunged to the daily limit down after its CEO suggested at an industry event that the compound behind its Eli Lilly collaboration wasn't the widely expected tirzepatide. HLB also hit the limit down after receiving its third FDA complete-response letter for gastric cancer drug rivoceranib. Still, news that ProteinaCore signed a follow-on licensing deal with Samsung Biologics limited contagion to other biotech names, and bargain-hunting emerged after the Kosdaq briefly dipped into the 700s, helping the broader sector hold up relatively well.