The ADR Listing Scale Is to Be Around 2.4% of the Company’s Total Shares, Aiming for Expanding Its AI Semiconductor Capabilities
SK Hynix Icheon plant (Photo courtesy of SK Hynix)
SK hynix announces the issuance of new shares to facilitate the listing of American Depositary Receipts (ADRs) on the U.S. stock market, aiming to raise significant funds for expanding its AI semiconductor capabilities.
The company plans to utilize these funds to enhance its production capacity and maintain its leadership in the global High Bandwidth Memory (HBM) market.
SK hynix to Issue New Shares for ADR Listing on U.S. Stock Market
SK hynix is pursuing a plan to issue new shares and list American Depositary Receipts (ADRs), which are alternative securities issued for the overseas distribution of stocks, on the U.S. stock market. With no available treasury stock following a cancellation last month, the company has opted to issue new shares. SK hynix plans to use the funds raised through this move to expand its production capacity for cutting-edge memory, such as High Bandwidth Memory (HBM), and strengthen its leadership in the global artificial intelligence (AI) semiconductor market.
According to industry sources on March 23, SK hynix has decided to issue new shares for its U.S. ADR listing. The scale is reported to be around 2.4% of total shares, similar to the volume of treasury stock that was canceled.
SK hynix had initially actively considered listing ADRs using its existing treasury stock (2.4%). However, facing criticism that it might be trying to evade the mandatory cancellation of treasury stock, the company abruptly canceled 2.1% of its treasury shares (12.24 trillion won or about $8.16 billion) on Feb 9. SK Group Chairman Chey Tae-won also stated at Nvidia’s annual developer conference, ‘GTC 2026’, on March 16, “We are considering an ADR listing.”
SK hynix anticipates securing between 10 trillion and 15 trillion won in dollar-denominated funds through the new share issuance. These funds are slated to be used for AI infrastructure construction costs, including the development of the Yongin Semiconductor Cluster, a project with an investment of 600 trillion won.
An industry official stated, “SK hynix is discussing the scale of the new share issuance, conscious of potential shareholder backlash and negative public opinion,” adding, “There is also a possibility that the scale could be increased in the future.”
At the ‘SK AI Summit’ last October, SK Group Chairman Chey Tae-won said, “The growth rate of artificial intelligence (AI) demand is explosive. SK’s role is to solve this supply bottleneck.” Industry insiders interpreted this as a declaration by SK hynix, as the global No. 1 HBM market player, to establish an unrivaled supply capability. The key is securing funds. This is because securing overwhelming production capacity requires hundreds of trillions of won in firepower.
In fact, the funds required for the four fabs in the semiconductor cluster that SK hynix is building in Yongin, Gyeonggi Province, are increasing exponentially. The cost, initially projected at 128 trillion won by 2028 when announced in 2019, is now expected to swell to 600 trillion won due to process miniaturization and rising raw material costs as of last year. Chairman Chey himself lamented, “The more we touch it, the larger the investment scale becomes.” However, there are limits to covering such massive funds solely through domestic financial loans or bond issuances. This is why the current push for a U.S. ADR listing is being called Chairman Chey’s ‘financial gambit’ to defend his No. 1 position in HBM.
According to industry and investment banking (IB) sources on March 23, SK hynix plans to select an underwriter soon and begin the ADR listing process. The newly issued shares will not be released on the domestic market but will be immediately deposited with a custodian, the Korea Securities Depository. A local U.S. bank will then issue ADRs based on these shares.
Industry analysts believe this ADR listing holds significance beyond simple fundraising, as it offers an opportunity for the company’s value to be reassessed. SK hynix’s global HBM market share last year was 57%, more than double that of U.S.-based Micron (21%). Its operating profit also overwhelmed Micron’s, at 47.2063 trillion won compared to Micron’s 24.2 trillion won.
However, its market valuation is harsh. SK hynix’s price-to-earnings ratio (P/E ratio) is about 5.7 times, half that of Micron (12.1 times). If SK hynix achieves a P/E ratio comparable to Micron’s through the U.S. listing, a simple calculation suggests its stock price could soar to over double its current value, into the 1.9 million won range. If included in major global indices like the Philadelphia Semiconductor Index (SOX) through the ADR issuance, the company can expect an influx of large-scale passive funds that track the index. Chairman Chey also remarked at Nvidia’s annual developer conference, GTC 2026, on the 16th, “We can become a more global company by being exposed not only to Korean shareholders but also to global shareholders.”
An industry official predicted, “If the new share ADR listing is successful, SK hynix will possess capital mobilization power on par with TSMC or Nvidia.”
SK hynix aims to use this listing as a springboard to re-emerge as a leading global AI semiconductor company. While it has dominated the HBM market with the strong backing of its ally Nvidia, the recent market landscape is no longer a situation for complacency. This is because a sense of crisis has grown after losing the lead in the next-generation flagship product, the 6th-generation HBM4, to Samsung Electronics.
In response, SK hynix is staking its survival on expanding production capacity. It plans to boost its capital expenditure for this year to the mid-30 trillion won range, including an investment of over 20 trillion won to develop its Cheongju M15X fab into a dedicated HBM production base. The company has also decided to move up the start of operations for the first clean room at the Yongin Cluster, scheduled for 2027, by three months from the original May to February. To this end, it has decided to prioritize the execution of 21.6 trillion won in new facility investment for the first fab in Yongin by the end of 2030.
However, it seems unavoidable that the company will face criticism that pursuing an ADR listing through new share issuance runs counter to the corporate ‘Value-up’ trend. This is because it is issuing new shares just over a month after abruptly canceling its available treasury stock in the name of shareholder returns. SK hynix is expected to actively emphasize that the funds raised through the listing will lead to securing a leading position in the next-generation AI semiconductor market, thereby generating greater returns.
Yoon Young-sil
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